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Ten Steps for Boosting Your Firm's Innovation

By Jeffrey Baumgartner

If you thought turning your company into an innovation powerhouse was a complex and painful task, think again! Here are ten simple steps you can take to turn your company into an innovation leader. Learn how to race ahead with new products, services and improved processes while your competitors remain far behind with outdated products, limited services and inefficient processes.

1. Know What Innovation Means

Before you start on the path to innovation be sure you know what innovation is and is not. A lot of CEOs say, “Innovation is our number one priority.” Yet, many of them would be hard pressed to actually define innovation in simple terms. Do not worry, the definition is simple. Innovation is the implementation of creative ideas in order to add value to the firm, usually through increased income, reduced operational costs or both.

2. Innovation is a Group Thing

Understand that innovation is not an individual thing. It is a corporate thing. Although innovation writers like to talk about individual innovators they usually mean individual creative thinkers or individuals who come up with clever ideas that become the basis of innovations. But an idea is not an innovation. It is only the beginning. In business, ideas need to be evaluated for viability, developed into concepts and turned into reality. A new product idea, for example, will likely involve developing prototypes, seeking feedback, testing functionality, setting up production facilities, seeking suppliers and much more. Each of these steps requires the participation of numerous people. All of whom contribute to the overall innovation process. Ideally, new creative thinking will go into the product concept at every step of this process making it more and more creative all the time. Unfortunately, the sad truth is many organizations that risk adverse committees tend to remove creative elements of new product ideas at every step of the production process, thereby reducing innovation potential. If your company is like this you either need to get rid of those committees or start with incredibly creative ideas so that by the time the committees finish with the ideas they still have lots of innovation potential.

3. Define Your Innovation Goals

Just “doing” innovation is not enough. You need to also have clear innovation goals to shoot for. These goals tend to be similar to strategy and business goals. It is usually a simple matter of reformulating these goals. Typical innovation goals might be to ensure that 25 percent of your product line is replaced annually; or to improve process efficiency by five percent per year; or that your firm is the technology leader in your sector; or that your company achieves a billion dollar turnover by 2012. Once you have clarified these goals you will find innovation initiatives are a breeze to set up.

4. Put Your Money Where Your Mouth Is

If innovation is your firm’s number one priority then you have surely allotted a number one priority-sized budget for that innovation, right? After all, you need to set up an innovation process, put a team in charge, invest in innovation tools and invest in training. This all requires money. You need to make a pot of money available for implementing highly risky yet (potentially) highly innovative ideas. After all, the ideas with the greatest innovation potential are by necessity radically different to business as usual. This means they are also risky. If you are going to aim for breakthrough innovation then you need to provide budget for developing and implementing breakthrough ideas. Keep in mind that if your innovation budget is zero then the attention your managers will give to innovation will also be zero. If there is budget for innovation you can be sure your managers will be scrambling to nab some of that budget for innovation in their own divisions.

5. Work on Your Innovation Culture

For creativity and innovation to thrive you need to have a corporate culture that nurtures creative thinking, sees mistakes as on the job training and embraces every step of the innovation process. Sadly, few firms actually do this. What is the typical response to an intern who announces a wild and crazy idea during a unit meeting? Is it:

A.To laugh knowingly and explain that there is no budget, the CEO would never like it and that the intern clearly does not know how things work in your company?

B.Or is it “B” congratulate her on a clever idea, discuss the challenges that would be faced in implementing that idea and ask her to work out how she could improve the idea so that it can overcome the challenges?

If your answer is “A” you have a typical firm where innovation is talked about on the surface, but discouraged in practice. If your answer is “B” your firm is already well on its way as an innovative leader – if it is not there already.

6. Establish Diverse Teams

Diversity is not only politically correct it is also innovatively correct. Diversity of membership brings a broader range of knowledge, experience, thinking and creativity to any team. You should, therefore, ensure that project teams, problem solving teams and all teams that are expected to contribute to your innovation process are as diverse as possible.

7. Collaborative Tools

Collaborative tools can help support your innovation process particularly if your firm has hundreds or thousands of employees. In smaller firms, wikis, blogs and shared documents permit a lot of collaboration with little technological investment. In larger firms, innovation process management tools can help ensure cross enterprise collaboration, facilitate collaboration by predefined teams as well as ad hoc virtual teams while providing a detailed record of your innovation results. But be careful to choose tools that achieve your innovation goals. Many tools might be great for generating and sharing ideas, but if those ideas are completely irrelevant to your goals they will not help your firm become more innovative.

8. Make Mistakes

Make mistakes and learn from them. Most great innovations are built from mountains of mistakes. As long as you can identify ideas that will not work relatively early in their implementations you can kill them before they eat up too much budget. You can then congratulate the team responsible for their efforts, evaluate what went wrong, learn lessons and try again. But as soon as mistakes cost people jobs, no one will dare to try anything radical and that will kill all but incremental innovation.

9. Implement

Innovation is not about ideas or creativity or training programs. It is about implementing creative ideas in order to add value. If your firm is reluctant to implement highly creative ideas then your entire innovation process will be little more than a creative thinking exercise. If employees note that highly creative ideas are (routinely) not implemented then they will not bother sharing or developing such ideas.

10. Evaluate and Improve

Your innovation process can also improve through innovation. That is why you need to review processes and results on a regular basis. Use your innovation process for generating, developing and implementing ideas for improving that innovation process.

Editor’s note:This article was originally published

About the Author:

Jeffrey Baumgartner is the founder and managing director of a leading provider of innovation process management software and services to firms in North America, South America, Europe, Africa and Australia. He is also the editor and primary writer for Report 103 a popular newsletter on creativity, ideas, imagination and innovation. Previously, he has advised the European Commission on e-commerce, set up one of Thailand’s first multimedia production companies and has been a magazine columnist for Asian business. Contact Jeffrey Baumgartner at jeffreyb (at) or visit