A strategic approach to prioritising innovation opportunities

Since the beginning of 2023, i have been looking at ways to simplify how logistics businesses transform to embrace the digital world. Today, read an article by Gartner about R&D leaders needing new approaches to managing transformational innovation.

The key findings were:

• Even though the best intentions are there, typical R&D processes for managing transformational innovation tend to prioritize incremental opportunities over disruptive but uncertain concepts.
• The lack of an effective way to measure the worth of transformational innovation leads stakeholders to prefer the safety of some outcomes over the possibility of a greater return, resulting in more conservative investment choices.
• Implementing balanced scorecards can lead to a concentration on similar projects, which can limit future growth and hinder competitive advantage.
• When assessing transformational projects in isolation, without regard for how they fit into the wider portfolio, the benefits resulting from project interdependence and variety are not accounted for.
• R&D teams that outshine their rivals, prioritise focusing on creative solutions, have a different set of criteria for examining transformative projects, and capitalize on the diversity of their transformational portfolios.
  

What struck me was how the same principles could be applied to supply chains and fulfilment operations. Today’s digital era sees technological capabilities and applications change rapidly amongst increasingly fierce competition.

Business leaders need to adopt new strategies and approaches for managing transformational innovation. Big-tech companies such as Microsoft, Google, and Apple have all embraced new approaches to R&D and innovation, placing a strong emphasis on collaboration, agility, and experimentation.

Satya Nadella, CEO of Microsoft said innovation is all about collaboration and co-creation and it is not enough to just have the best ideas, but rather the ability to execute them quickly.

Similarly, Google’s CEO Sundar Pichai said a culture of innovation requires being open to new ideas, taking risks, and learning from mistakes. Both of these tech leaders have highlighted the need for a new approach.

By testing and validating ideas, companies can avoid costly mistakes and improve the likelihood of success. Apple is an example of a company that has embraced experimentation as part of its R&D strategy. Apple CEO Tim Cook has said “we believe experimentation is essential to innovation, and that’s why we invest heavily in it.”

Finally, like R&D leaders, business leaders also need to ensure that their approach to innovation is supported by the right technology and data. Companies such as Amazon, Microsoft and IBM have all invested heavily in technologies such as artificial intelligence (AI), machine learning, and analytics to support their innovation strategies.

Conclusion

Business leaders must adopt new strategies and approaches to managing transformational innovation to remain competitive in an era of fast-emerging technologies and shifting competition. These strategies should include; a focus on collaboration, agility, experimentation, and the use of the right technology and data. By doing so, companies can ensure that their R&D and innovation efforts are successful and that their competitive advantage is maintained.