Coming up with the ideas is easy, but turning those bright sparks into successful businesses is a lot harder.
Most organisations do not have a major problem generating new ideas, but many firms fail when it comes to implementing fresh business models or turning good ideas into organisational objectives, according to a new report from Cass Business School.
The research, sponsored by VMware, reveals the extent of the gap between innovation and execution. Here, three experts give their tips on the best ways for executives to close the gap between innovation and execution.
1. Throw a lot of stones and sometimes you'll hit something
Professor Feng Li, head of technology and innovation management at Cass Business School, recognises the potential for digital disruption in all sectors means business transformation is now a continual work in progress.
"As organisations become more agile, we see successes, but also complications, in terms of how they bring new ideas to market," says Feng. "Ideas are common, yet game-changing concepts are rare. There's a gap between the ability to start generating ideas and the reality of bringing those ideas to market in a relevant way."
Feng says many of the challenges around creativity are related to definitions. He says many employees still think innovation is about creating something brand new. "Most things already exist -- innovation is about creating new value across existing dimensions," says Feng.
The good news, he says, is modern businesses have access to more ideas than ever before. The smartest executives adopt and adapt these ideas flexibly. Fast-moving organisations, which develop business models across a range of areas, are more likely to be successful.
So, rather than focusing on the transformation of an existing operation, Feng says executives should use the cash generated by their core business to invest in new internal and external ventures. Feng encourages business leaders to embrace broad experimentation.
"The hard part of innovation is finding the nuggets that will generate high returns," he says. "However, if you throw lots of stones, you'll break a window somewhere. If you invest in 100 ideas, then one day -- when your core business is cannibalised -- some of your ideas might have taken off and your company will still be sustainable."
2. Integrate smart thinking quickly and effectively
Gideon Kay, group CIO at media giant Dentsu Aegis, recognises it can be tough for IT leaders and their C-suite peers to generate a culture of creativity. He says his own firm aims to avoid introducing processes that will stifle innovation.
"We don't want to create hoops for people to jump through, with huge amounts of paperwork," he says. "At the core of our business, we have some key pillars that help support this approach, particularly in terms of our brand values."
Kay says the nature of Dentsu Aegis' work in the advertising and marketing sector means the firm's 45,000 employees around the globe must be confident and creative.
"We're in an industry that, unless we innovate, we die. It's a hugely disruptive sector and there's a significant amount of change going on. Our clients want us to help them engage with the public in novel ways. We want to help our people bring their ideas to the fore."
Kay says employee growth at Dentsu Aegis has been fuelled by acquisition. The firm tends to buy small-to-medium sized and owner-managed businesses that are dynamic, agile, and cloud-native. Kay's team works hard to ensure capability in those entrepreneurial start-ups is integrated into the Dentsu Aegis corporate environment.
"Navigating those regulatory challenges, and being successful, is something we do well," he says. "You can measure our success by the fact that many of the owners of the firms we acquire stay with us long after the purchase process is complete."
Kay uses technology to reduce the friction in the integration process, to cut the time it takes to integrate a new business and to ensure Dentsu Aegis can harness the innovation in those startups. "Trying to absorb businesses quickly, while stimulating our in-house thinking, is tough, but it's a challenge we continually strive to overcome," he says.
3. Make sure you have the right vision for the business
Kevin O'Connor, managing director and head of private equity at information research specialist IHS Markit, says it is undoubtedly true that the pace at which you can launch a business today is faster than ever before. However, O'Connor also believes the barriers to entry are much lower, particularly in terms of technological knowledge.
"Because of that opportunity, a lot of bad ideas can get much further than they should," he says. "I'm a big believer in the survival of the fittest. I'm a strong advocate for not making innovation too easy -- if it's too easy, the stuff you should have killed a long time ago might live on for far too long."
O'Connor says his tough stance on innovation is fostered through his sector of operation and the constraints he faces.
"We can't just go out and experiment," he says. "Yes, speed is important, but it's not something I think about often. Vision is far more important to us. We need a vision of where we want to go and we need to engage with our clients to deliver what they want, with lots of checks and balances. As a business leader, you must understand and set priorities that are right for your business, and then stay true to the mission."