Executive with a Track Record in Developing Growth Strategies and Solutions: I have devised and implemented winning strategies that have opened up new markets and business opportunities. I have developed strategies that address customer/market needs, secured buy-in from executives/board, motivated the functional organizations to deliver and launched successful products & business models.

 

Family Man: I enjoy spending time with my beautiful wife and two lovely kids. As a family we are a good mix of outdoors and indoors. My son and I are pretty much outdoors and sports oriented while my daughter and my wife like the indoors. This diversity of interests helps us maintain good balance in our lives.

Strategy Frameworks for Innovation

Strategy and Innovation go together. The former sets the vision and goals to aspire, while the later provides the execution power needed to meet the goals.

Strategy also helps define innovation as it helps in answering the following questions:

  • Does the company need to grow organically or is inorganic growth a better option?
  • Does the company need to build, buy or partner?
  • Is this the right time to innovate?
  • What kind of financials should the company expect?
  • What is the right time frame for profitable innovation?

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Innovation Needs Ambidextrous CEOs

In a earlier blog I had discussed  “Innovation Influencers” and how each influencers holds a critical piece of the puzzle required to unlock innovation. At the center of this puzzle is the CEO of the company. CEO should take personal interest in innovation and cultivate the right culture within the company.

HBR article on “The Ambidextrous CEO” analyzes this topic well and here are some of the reasons why it is important for the CEO to support innovation.

  1. Innovation drives long-term growth: Stable companies have a good understanding of their traditional growth rate based on market dynamics. Company shareholders know the traditional growth rate and expect companies to do better year over year. Without innovation, companies cannot meet shareholders’  ever growing demand for growth. Hence, CEO’s rely on innovation to build the future growth engines that would help them meet their future growth obligations.
  2. Future is more uncertain with innovation than with core products: Issues with core products, revenue expectations, margin expectations and overall performance is estimated relatively well with core products. But innovation potential is very uncertain and usually a wild guess. And who better to guide/support the team dealing with this uncertainty than the most visionary person in the room, i.e. the CEO.
  3. Traditional business metrics do not apply to innovation: Given many innovation projects start out with no or modest revenue numbers, business metrics like contribution margin, revenue per FTE etc cannot be applied to innovation projects. These metrics make innovation projects look bad and ignore future potential of the projects. When executives try to measure innovation using the same scale as core business, CEO needs to step up and support innovation to give it a chance to survive.
  4. Left to mid-level managers, innovation will suffer: Budget decisions, staffing decisions, marketing and sales support decisions, and many more such decisions are usually made in support of core products. This is because mid-level managers are trying to make decisions in their best interests and in supporting their products. Given that innovation products are not the responsibility of majority of the mid-level managers, they tend to starve innovation projects. This is where CEO needs to step in and assign right resources for innovation projects to make sure that innovation thrives at the organization.
  5. Innovative companies enjoy higher multiples and generate more shareholder value: Typically companies that innovate and generate higher growth rates get better multiple for their earnings. This in turn generates better shareholder return, which is the primary job of the CEO.

Companies where innovation is actively supported by the CEO, strive at innovation and generate better shareholder value

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Ideate – Successful Collaborative Innovation @ Wipro

Recently I met Dinesh Veerula who is a Delivery Manager with Wipro’s BFSI vertical in Hyderabad, India. His expertise is in Financial industry operations outsourcing. The industry he serves is very demanding with strict SLA goals around operations improvement and cost per trade reductions.

To meet these demanding SLA requirements, his team has to continuously innovate and improve data center operations. And he achieves this through a collaborative innovation process that he setup called “Ideate”.

Dinesh has about 150+ people reporting to him in 7 different locations across the world (in India, US, Europe & Singapore). The international locations and the size of his organization make it difficult for him to have a coordinated innovation effort. In this situation many managers resort to top-down innovation (i.e. leaders innovate and everyone else executes). more

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Top 10 Characteristics of Innovation Leaders

My last post about “Innovation Influencers” was about stakeholders who hold key pieces of the puzzle that are important for innovation success. Innovation Leader need to influence these stakeholders. Here are the Top 10 characteristics that the leader needs to have to be successful:

  1. Leadership: Strong leadership is key to innovation success as many decisions that shape innovation need to made along the path by the leader. Information required to innovate is often not available and when available it is often sketchy at best. And there are many challenges along the path which often derail innovation. Hence a strong leadership is key to innovation success, where leader is able to motivate and lead people along the path, making the right decisions and overcoming most challenges.
  2. Visionary: Leaders need followers who have bought into leader’s vision and are willing to work hard to meet that vision. Hence having a grand and exciting vision and articulating it well is important for innovation success. This vision needs should be big enough to motivate people to work hard and contribute to realizing this vision. But at the same time it should be realistic and believable. For example, eliminating world hunger would be a very grand vision, but  it would not be realistic and hence would fail to motivate people. But eliminating hunger related deaths within children of a particular region would be manageable and motivating vision.
  3. Change Agent: Innovation Leaders primary responsibility is change management and making sure that people within the organization change their current methods/processes and adopt newer innovation. Also making sure that customers change their old ways and adopt newer solutions. This requires extensive change management, making sure that employees and customers are on-board and supportive of the innovation.
  4. Salesperson: Innovation leader should be very good sales person as the leader needs to sell this idea to many people. First, the leader needs to sell the idea to the executives to secure funding. Then the idea/vision is sold to employees so that they take part. Then this idea is sold to the customers, so that they are on-board and are willing to pay for innovation. And along the way there is much more selling that the leader needs to do.
  5. Good listener: Innovation Leader needs to have good listening skills to understand customer’s real requirements. It often happens that leaders go into a meeting with a preconceived notion of what the customer wants. And though the customer might be saying something completely different, innovation leaders might be listening what they want to listen. Hence it is very important that innovation leaders develop good listening skills. Leaders should actively listen to what customers and employees are saying and then form an opinion based on what they listen and not the other way around.
  6. Logical Thinker: Innovation path is prone to biases and leaders often fall prey to these biases. Identifying biases and having a logical approach to making decisions is critical for innovation success. And this discipline needs to be developed and implemented by the leader.
  7. Team Builder: Innovation cannot be done alone, it requires a team of very talented people who are willing to work hard to make it successful. Hence the leader needs to focus on building the right team, delegating responsibilities to team member and making sure that each team member is successful.
  8. Even-Keeled: Leading innovation is not for emotional people. Innovation leader needs to have a cool-headed, even-keeled demeanor. People who get emotional about ideas/concepts often form biases which could lead innovation down a wrong path. Also, when confronted with disputes they often do not have the best logical approach to resolving disputes, leading to organizational alienation of the project.
  9. Passionate: Innovation leader needs to passionate about the idea/concept. Passion acts like the fuel required for changing the landscape through innovation. Passion is contagious and it motivates people to follow the passionate leader. Passion makes customers believe in the solution they are purchasing. Hence innovation leaders need to very passionate about the idea/concept.
  10. Optimistic: This is very important for success of innovation. The leader needs to be optimistic and needs to deliver positive/optimistic messages at every possible opportunity. This will reduce negativity and fear of failure that resides within the team, motivating them to give to the success of the project.

These are the top characteristics that innovation leaders must have, plus they need to have many more depending on their environment. And much of the characteristics described above can be gained through practice.

Note: “Innovation Leaders” are executives who lead innovation within an organization. They don’t have to be innovative themselves but they are required to be good leaders.

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Understanding Innovation Influencers – Key to Innovation Success

Much of the innovation success lies beyond the Innovators abilities and with “Innovation Influencers”, who have a seat at the organization table and hold a key piece of the puzzle. Every organization has its own set of influencers and each set have their own personal/professional agenda. Understanding the power of these influencers and their agendas is key to successful innovation, and something that an innovative leader should do early in the process.

 

Innovation influencers have critical pieces of the puzzle that affect innovation success

“Innovation Influencers” hold key pieces of the puzzle required for the innovative idea to succeed. And they could alter the fate of the innovative idea, even for ideas that have market potential and interested customers. Below are some of the key motivations for these influencers (these do vary by size of the company and type of industry, but the list below is most common):

  • Sales: Their biggest motivation is the money they get to take home and the end of the quarter. Since majority of their compensation comes from sales commissions, their focus is on the commission revenue they get from selling the innovative idea. If the idea is at the bottom of the sales stack (as measured by immediate sales commission a sales rep can pocket), then it is highly unlikely that they would put in the required effort in selling the idea. This would lead to lower sales and eventual axing of the idea.
  • Finance: Their motivation is end of quarter earnings and what they have to report out (to the street and to the board).  If there is a significant earnings impact of the innovative idea, finance will use every possible reason to block the idea.
  • Operations: This comprises of everything from sales ops, IT, manufacturing, logistics, customer service etc. Most of these players are essential for successful delivery of the idea. Their motivation is to keep their already complicated work life simple, and an idea that complicates their lives is going to face tough resistance.
  • Product: This comprises of development, management and marketing and their motivation is yearly budget. Anything that boosts it is good, and anything that harms it is not so good. Also, there are specific delivery metrics for product management organizations which shape their support for the innovative ideas
  • Strategy: They could be driven by specific innovation metrics, but usually are “resume watchers” who feel that there resume gets weak if they do not deliver some innovative strategies that make market impact every quarter.
  • Legal/HR: Their motivation is to carry out the established policies and guidelines. Any idea that does not fall in line with the policies is not valued by these influencers.
  • CEO: Key influencer who has an impact on all other influencers and veto rights. If the CEO is passionate about an innovative idea, he can get all the other players to line up behind the idea. There are a few things a CEO can do to make sure that all parties participate with right intentions. But then the personality and background of the CEO dictates how much leverage he would have on all the influencers. Getting the CEO to become passionate about the innovative idea is the best starting point.

Getting these influencers to line with the innovative ideas and managing them along the journey is the key responsibility of the innovation leader (along with other responsibilities related to delivering innovation that matters to the customer). And there are specific methods for influencing these influencers which I would blog about in future blogs. Understanding the influencers in the organization and having a plan to secure their buy-ins is very critical for innovation.

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Concept 2 Revenue: Key to Successful Business Innovation

“Concept” or “Idea” is often assumed to be the key ingredient to building a successful business, and hence a lot effort is put behind securing the idea, patenting it and protecting it. But as the cliché goes “Ideas are dime a dozen“, and this is true.

In many cases the initial idea with which the innovator started the journey is not the idea that is successful, but it has morphed along the way to an idea that is more acceptable/appreciated by the target audience. And along this journey there are many challenges that the innovators faced. There were hundreds of strategic decisions/ choices that they made which shaped the idea itself and its revenue earning potential. And there were multiple change management situations that they handled well to ensure that roadblocks to  innovation were removed ahead of time.

And it is truly the combination of all the actions/decisions taken during this journey starting at definition of the initial “Concept” to the recognition to sizable “Revenues”, are the key ingredients to building a successful business. Ideas on the other hand are just that, “Dime a Dozen”.

Through this blog I plan on discussing the different challenges and decisions that are required to be made from “Concept-2-Revenue”. There is no one size fits all, and this blog is not meant to be a holy grail. All it is a simple collection of various actions that I have seen lead to successful businesses.

Who should read this?

Business executives who are looking for innovating and developing new business opportunities. Who run into challenges when pursuing their innovation dreams and would like to learn from outside sources on how to solve some complex innovation challenges. Start-up entrepreneurs may not find this blog useful as they do not face many of the challenges/issues discussed in this blog (if they do then they should rethink their priorities/organization).

I hope you find this blog as entertaining and enjoying as I have found writing it.

 

 

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