‘Fintech’ and ‘innovation’ are both hot topics and buzzwords that are seemingly being dropped in to every conversation related to financial services at the moment. However the latter has always been essential to any business
as the only source of sustainable growth, but somehow never with quite the overt focus it has right now. Having established that innovation is critical to growth, how do you create a culture where innovation happens naturally and becomes embedded in your corporate
DNA, in order that you can consistently offer market leading services and solutions? This might be achieved through incremental improvement, or it might be through radical change; either way you have to keep moving.
Unfortunately it isn’t as simple as walking out onto the floor, gathering everyone round and advising them that “from now on everyone has to be more innovative!” You might get lucky, but that approach isn’t likely to yield the sustained transformation of ideas
into viable commercial solutions, because that is ultimately what innovation is. Ideas should always be encouraged but if they don’t make a positive difference to the bottom line or brand value, in themselves they offer little value.
Instead, you need to develop a strategy that enables you to create a culture where all your people, no matter what their role or level in the organisation, see themselves as empowered and enthusiastic agents of change creating and contributing to innovative
solutions and services that enable your business to gain a competitive advantage in the market. I will be honest with you up front, there are no short cuts, it is hard, and you are probably looking at a multi-year investment…..but if the challenge seems daunting,
just ask yourself ‘what if we don’t innovate?’ Will the firm become stuck in the doldrums, or worse still, be overtaken by more spritely and innovative competitors?
Leading global brands definitely have the capability to innovate, and often they are better quipped and have more resources to apply to innovation than any small start-up. They also have an established brand, existing customers, established channels to market,
and investment in technology. The challenge and the opportunity is to allow those within the firm to develop ideas, take some risk, and to learn from their mistakes.
Internal entrepreneurs and new ideas exist in all firms, both large and small, they just need to be allowed the freedom to grow. The corporate ‘centre’ needs to work hard alongside those who have innovative ideas, in order to remove obstacles, encourage
innovation and fuel creative start-ups.
The strategy we advise to make this happen consists of three key and interlocking components, based on the established pillars of
People, Process and Technology, so let’s address each of these in turn.
In order for your people to achieve their full potential as innovators, they will need some things from the firm.
- Firstly they will need to know that innovation is a core competency that you value and that it is something that they will be formally measured against, and more importantly recognised and rewarded for.
- Secondly, they will need assistance to develop the right skills; not everyone is a natural entrepreneur, so a training programme related to creative thinking can be a good starting point.
- Providing a physical space and supporting technology, as well as being creative about how people utilise their time, will facilitate ‘innovation studios’ where individuals and small groups can work on new ideas outside (and not constrained by the norms)
of their day jobs.
- Lastly and most importantly, they need to know that when they put their head above the parapet, they do so in a collaborative environment where trying but not succeeding is valued much more by you than playing safe.
Once you have raised awareness, created enthusiasm and started developing your people’s innovation skills, how do you direct them to ensure that you identify, select and invest in the innovations that will deliver the best ROI?
Create clearly defined and simple to understand criteria for innovation success. The first mistake made by many is to create a formal, rigid process involving increasingly senior signoff committees and parades…..unless of course that reflects your company
culture, in which case you probably aren’t going to be that interested in innovation any way!
- If you do take that approach, you are going to stifle a lot of ideas because people probably won’t take the leap of faith and invest their own time perceiving it to be “too difficult” or “risky”.
Far better to create clearly defined and simple to understand criteria (….but not too many) that will help guide people in terms of what good looks like and allow them to quickly self-assess as to whether their idea is in scope.
- In this context and when time and the investment pound/dollar/euro are both likely to be precious, failing early is equally as important as achieving ROI. Ideally, you will have sought the input of your people to help generate and define these criteria
which in turn will help get their buy in and awareness levels raised early.
- The defined criteria should also allow people to self-manage, so that by the time they engage with a more formal investment governance process (the timing and structure of which should be scaled according to investment and risk), they will been able to
develop the idea and obtained the required support such that the review and approval process is as efficient and effective as possible
- …..and even if the idea is rejected at this point make sure that the team receive positive feedback, constructive guidance, a sincere thank you and a request for them to bring forward more ideas in the future.
Most companies have a distributed workforce, so how do you make it easy for the innovators to find each other and when they have, how do you quickly and easily capture, evaluate, prioritise and manage all their ideas?
The application of appropriate technology is the third key component of successful innovation strategy. There are a number of innovation management platforms on the market, but please consider the following criteria before selecting one.
- Will it enable people in different functions and locations as well as external partners to collaborate?
- Will it enable informal networks to self-manage and quickly move from ‘form’ to ‘perform’, does it utilise the concepts of social media and gamification, so that people can vote or like so that good ideas trend and ideas who don’t gain support are able
to fail early?
- Does it provide you with the capability to generate MI so that you can easily identify who generates and contributes to innovation during the year – so that you can recognise and reward their contribution?
- Does it make it easy to share knowledge, ideas and lessons learnt?
- Is it mobile?
If the answer to all of these is a resounding ‘yes’ then you have the last piece of your jigsaw and are ready to start creating an innovative culture that could help you realise the full potential of your business.