What Is Innovation Strategy? How To Develop An Innovation Strategy For Your Organization?
by Shahnawaz Alam Business Planning 29 September 2023
Getting a new idea and product or service out in the market is not the be-all and end-all for a business. They constantly build new things and come up with new ideas. While ideas can come out of the box, we cannot wait for divine inspiration to poke us in the middle of the night, asking us to do something about the present. That’s what innovation strategy is for.
This is a system allowing entrepreneurs and leaders to create a working system that encourages and fosters innovation. A business can stay ahead in the competition, sustain itself in the long run, and even disrupt its respective industries with an effective innovation strategy.
This article gives you a clear idea of what innovation strategy is and how a brand can develop an innovation strategy. Keep reading to find out more about the same.
What Is Innovation Strategy?
Businesses often have an innovation strategy that includes using their resources and time to fulfill their objective of innovations. Eventually, they end up creating and adding new value to the customers. The entire process includes following different sets of policies and behaviors directed toward achieving a future-oriented goal.
According to the innovation strategy, most big businesses follow creative new ideas, and plans do not just appear out of thin air. It requires a strategic plan, time, and an environment nurtured to generate and grow innovation.
Why Is Innovation Strategy Important?
Innovation strategies are of huge and immense importance. Here, go through these points to learn about its importance –
Strategic & Goal Oriented Procedure
Innovation strategies help an organization work towards an outcome that is new and innovative. It first outlines the organizational goals and what they are trying to achieve. The strategy helps the business focus on strategic efforts that will eventually lead them to the goal they are aiming for.
An organization usually has different sets of groups and teams working towards a common goal. Having a goal outlined for the innovative company achievement helps different teams at different levels contribute to the larger picture. Eventually, the innovation strategy allows businesses to foster alignment across teams.
There will be multiple competitors and copycats in the market. Businesses that started out as an innovator can stay on top of the line by adopting an innovation strategy. The market share will be taken by the competitors. But the innovators will always outshine everyone by being and staying innovative.
Businesses that are innovating and outshining their competitors always have a competitive edge in the market. They can sustain themselves in the market for a long time. Through innovation, they can keep their customers engaged with them at all times.
Different Types Of Innovation Strategies
Innovation strategies usually involve two different types of innovations – innovating new business processes and innovating new technologies or developing them to improve business processes. Both of these innovation strategies are key to a business’s long-term success. Here are four main types of innovation strategies that help a business –
Routine innovations allow businesses to stay new and fresh in the market. It is their capability to serve the customer base they already have by providing a new version of the existing product or renewing them with a new flare. For example, a game gets new updates month after month and keeps the players engaged through new innovative additions to the game.
A disruptive innovation in business makes a business set a groundbreaking example and shake off potential competitors. For example, Amazon once put its competitor e-commerce platforms in distress by announcing to provide free shipping. Such innovative decisions can disrupt an entire industry and make customers curious about a market disrupter.
Radical Innovation Strategy
Radical Innovation Strategy is another strategy allowing businesses to change and improve their existing business model through technological innovation. Infarm provides local and fresh produce to its customers. It has been possible only because of a radical innovation strategy.
Architectural innovation strategy makes use of both new technology and improved business processes. However, out of all innovation strategies, Architectural innovation is very difficult to pull off.
How To Develop An Innovation Strategy?
Here are some helpful steps for building An innovation strategy inside your workplace –
Align Innovation Strategy With Your Business Objective
Before you start developing the innovation strategy for your business, you must figure out the objective behind it. Just like any other large plan of action has an ulterior motive behind it, planning an innovation strategy must also have some objective behind it. Start by asking yourself questions like, why are you doing what you are doing? What are the major objectives of your business? How does developing an innovation strategy affect these large organizational goals? Can your innovation strategy help your business?
Assess Your Current Innovation Capabilities
Before you start to adopt an innovation strategy, assess your strengths and weaknesses. Take a look at your R&D resources, your processes, the current workforce, and the culture you have in your organization. This will help you figure out areas that need improvement and the areas that are more stable.
Get Deep Market Insight
Knowing about the market in detail will help you understand the areas where you can come up with an innovation. There is no point in spending your time and resources innovating something that already exists in the market. A clear market insight helps you identify and work on potential areas of improvement.
Define Your Innovation Focus
With a clear understanding of the market, a company can decide where they want to focus. Decide where you want to focus your innovation efforts. This could be in product development, process improvement, customer experience, or business model innovation.
Build An Innovation Team
Innovation strategy for your company might work at different levels and be incorporated across teams. But, while getting started, you will need a team that understands your vision for innovation. This involved building a team with different skills and from different teams.
Foster An Innovative Culture
Having a work culture that encourages and fosters the spark of innovation is crucial to building an innovation strategy for an organization. You must develop a culture that encourages creativity, risk-taking, and continuous improvement. Encourage employees to share ideas and provide them with the autonomy to pursue innovative projects.
Your company’s work process can have mechanisms and practices that spark new ideas to come forward. For example, having a brainstorming session with the innovation team is the best way to generate new and fresh ideas. Suggestion boxes and hackathons also go a long way into helping your brand build a work culture that helps generate new ideas. Encourage input from employees at all levels of the organization.
Some top businesses, such as Google, Apple, Amazon, Phillip Morrison, and Samsung, had innovation strategies. The extent of their growth to become dominating figures in their respective industries is incredible. It might prove fruitful if you also want to adopt an innovation strategy in your organization to foster a culture of new ideas and growth.
Hopefully, you learned something from this article. Let us know about your feedback on this article. However, if there are any additional queries relating to the same, you have to comment box to let us know about them. Thank you for reading.