NTT Data’s Tanvir Khan gives advice for companies on how to develop a culture of successful innovation.
Organisations innovate for different purposes depending on their needs and where they stand in their maturity and organisational journey. In turbulent times, innovation is a matter of survival. Uncertainty in the market creates opportunities but gives only small windows of time to seize them. Innovation is the key to taking advantage of these opportunities.
NTT Data’s Innovation Index study explored interest and investment in three types of innovation – mainstream, growth and emerging.
We discovered, not surprisingly, that 79pc of organisations are focused on mainstream and growth innovation. Mainstream innovation helps organisations optimise existing assets for existing clients and/or the market, while growth innovation helps them expand existing assets and develop new markets. This is typical behaviour of the market in times of uncertainty. Organisations will hold back on discretionary spending while needing to invest in ongoing ‘lights-on’ investments. Organisations secure their share of wallet with ongoing expenses, by reinforcing current products and services. This keeps their focus on mainstream innovation.
Alignment, patience, commitment
In the study, 11pc of respondents were labelled as innovators, or those excelling in their innovation programs better than the rest. This group allocates 10pc more spend towards emerging innovation, which develops breakthrough solutions and assets for potential new markets or opportunities. Organisations with an eye on the future plan current investments based on future aspirations, which is a key hallmark for innovators.
It’s important that organisations align their innovation strategy to their business goals and the strategic direction of the company first. Innovation for innovation’s sake is an empty target. I have seen the world of innovation being strewn with successful proof of concepts (PoCs). However, often these PoCs are unrelated to the business, so this can be a distraction to the organisation and should be avoided. If organisations don’t know what they’ll eventually do with the PoC after it succeeds, they shouldn’t do it in the first place.
Another critical piece of the innovation game is patience. Innovation journeys – from ideation to execution to value realisation – take time, often years and even decades. Innovative companies that have gone mainstream now were years in the making. So, patience is critical.
Along with patience, organisations should also be committed. This commitment is as much about allocating funds for innovation as it is about building resilience.
Our study reported that innovators spend aggressively on innovation. This is critical, especially in the light of the blistering pace of technology advancements, exemplified by the proliferation of AI technologies. As it often happens with big tech leaps, many organisations have been caught off guard because they’re still using legacy technology. Today, most organisations are unable to implement AI technologies into existing infrastructure because they haven’t modernised their IT. Unfortunately for them, speed is the name of the game today. If you wait, you lose, and you’ll find yourself playing catch-up.
Innovation is also about creating a discipline for building the right processes for capturing and evaluating ideas. In our study, 59pc of innovators (compared to 36pc of rest of the market) said they had a clear process to determine what products and services to innovate and are also able to measure results effectively. This commitment will also pave the way for creating a culture of innovation, another critical piece of the innovation puzzle. Our study found that 63pc of innovators (compared to 43pc of the rest of the market) have an innovation-focused culture.
The innovator’s playbook
To truly take advantage of the opportunities for innovation, even in an uncertain market, innovative organisations must focus some spend on emerging markets and position themselves to create solutions for potential new markets or opportunities. These innovations should be aligned with organisational strategy, with the understanding that it will take time and commitment before value is fully realised. This commitment should include the proper processes and culture so that companies can act when an opportunity arises. Only then can they act quickly enough to reap the benefits of those opportunities.
By Tanvir Khan
Tanvir Khan is the chief digital and strategy officer at NTT DATA Services, focusing on technology direction, go-to-market and offering management. With more than 25 years of experience in the IT industry, he is a thought leader in digital transformation, associated core technologies and value realisation.
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