The Most Important Motif in Creating Innovation in an Organization - Being Consistent and Methodical
An article based on a lecture given by Ari Manor, CEO of ZOOZ, at the People & Computers' CTO & IT Architects forum.
Published on
People & Computers' website, February 14, 2012
By: Yossi Hatony
Manor listed two reasons for creating innovation in an organization: creating added value and leading the market, and the need to optimize and lower costs ● He says that "technological innovation needs to be compatible with strategy, whether in creating added value or in giving a mediocre product but at a low cost."
"When creating innovation in an organization, you have to make sure that it is done in a consistent and methodical manner", says Ari Manor, CEO of ZOOZ.
Manor, also a Marketing Consultant, spoke at the People and Computers' CTO & IT Architects forum, which took place yesterday (Monday) at the Leonardo Hotel in Ramat Hachayal. He says that there are two reasons for creating innovation in an organization. One is to create added value and lead the market. "This is done by developing and implementing innovative technologies or by creating Intellectual Property and raising the value of the company", he says. The second reason is "the need to optimize and lower costs by creating a competitive price and/or increasing profitability, or creating Reverse Innovation".
Manor gave General Electric, which manufactures scanners, as an example of reverse innovation. "The people at General Electric told their sales manager in India to sell the scanner, which took up an entire room. The Indian manager replied that there were only six hospitals in the entire country that might be potential buyers, and even then patients would have a problem getting to the hospitals. He asked the company headquarters to develop a small and portable scanner, and surprisingly, the people at headquarters listened to him and did it".
Manor then explained the Michael Porter's smile model, according to which profitable companies in every industry offer a low cost product that appeals to the masses, or a premium product with an added value, such as Mercedes. "Most companies are 'stuck' in the middle of the smile - they are not unique, not cheap, give a little more and do not raise prices, and therefore their profits erode over time", he stated.
"Technological innovation needs to be compatible with strategy, whether in creating added value, such as Intel, which provides a rapid quad-core processor that does not heat up, or whether in offering a mediocre product but at a low price, like Compaq did in the past", he added. He says that there is a systematic way to manage innovation, and it entails several different dimensions: strategic infrastructure, organizational infrastructure, developing ideas, screening ideas, problem solving and commercialization. "At the level of the strategic infrastructure for innovation", Manor says, "You have to explore several questions: level of innovation - new to the world, to Israel, or to the organization; nature of innovation - developmental or revolutionary; and who will innovate - the entire organization, a special team, or a combination of both". The objectives of innovation, he says, are rapid launch to market, quick return on investment with revenue forecasts, percentage of revenues from the innovations, and number of patents registered every year.
Manor demonstrated several tools for coming up with innovative ideas, including SCAMPER (Substitute, Combine, Adjust, Modify, Put to other uses, Eliminate, and Rearrange). He described the Closed World Principle, which states that it is more effective and applicable to seek ideas for surprising innovations "under our nose". Manor named six designated thinking tools and explained how to manage an idea bank.
He summarized by saying that "in order to promote systematic innovation, you must define a clear innovation policy; create an organizational commitment to innovation at the CEO level combined with budget allocation; use the Closed World Principle and thinking tools; expand and fortify Intellectual Property using computerized tools; manage an organized and uniform idea bank; and promote Disruptive Innovation using a designated team".
Adir Ron, Manager of Financial and Healthcare Sector Solutions at Microsoft Israel, described the next generation of the company's organizational solutions. "We have solutions for inter-organizational processes that improve efficiency and cut operational costs". He also presented customer solutions via various channels vis-à-vis, integrating the cellular world and the social networks.
Alon Schwartz, Manager of Internet, Mobile and Social Media Technologies at the Information Technologies Department at Yes, described how to avoid snuffing innovation at an organization. He says that "methods and tools to promote and manage innovation processes are an important component in innovation processes, but they won't help to promote it. The day-to-day work in an organization is demanding and requires that goals and objectives are met. It is measured precisely and for the most part does not leave room for innovation development". He states that "integrating innovation processes in the existing work processes and measuring them with standard means will almost certainly destroy any innovation buds in the organization".
Systematic Innovation
Interested in systematic innovation processes in your organization?
Contact us: info@zooz.co.il, +972-9-958-5085
The article was written by Ari Manor, CEO of ZOOZ Marketing & Organizational Consulting. ZOOZ conducts training for managers and employees. Send your comments to ari@zooz.co.il.
