Innovation vs Transformation
“Nice to meet you, I’m the company’s new Head of Innovative Transformation Change” (or something like that!)
We’ve never met a Head of Innovation or Transformation who describes their job in the same way – so what role does innovation have in a company and how important is it?
It’s a tricky one, because all businesses need to adapt and evolve – the ones that stand still as we know have a shelf-life and are vulnerable to the changing external landscape as well as sneaky new competitors who appear intent to nibble their lunch. If businesses aren’t “innovating” then they’re probably “transforming”… so what’s the difference?
For us transformation is a term that’s misleading. It conjures up a picture that somehow there is an end state and you know when you get there. But we know that isn’t true because by the time you get there you probably need to transform again!! Transformation in our eyes means a constant and important focus on two things:
A continual review of what you do now in your core businesses/businesses to seek to ensure that they remain relevant and fit for purpose in a changing world – this creates your stability; and
At the same time, explore new products, services or markets that are different to the core with the view that, at some stage, these new products, services and markets will likely need to overtake what you currently consider core.
Take “The Taste of Milan” for example. An artisanal pizza business, they have a history of creating amazing pizzas in their locale. For years their little pizzeria has stood as an ‘if you know, you know’ sort of establishment. The arrival of businesses like Dominoes have done little to challenge their longstanding customers, but how do you evolve this business to challenge the demographic that aren’t local or perhaps don’t have the means to eat out – young families for example.
Well, they introduced ‘Frozen pizzas’. They make their pizzas and then fast freeze them, supplying them to local grocery outlets to sell for cooking at home. They bring the culinary experience to your own home! This shows ingenuity and foresight, as well as a calculated risk taking into diversifying what they do whilst remaining true to their core business. It hasn’t completely changed the heart of their business, but it has created a new revenue stream, enhanced their brand, created new customers AND created new demand for their original business by way of people discovering them through their frozen products. If the new idea works, they could have a much greater reach and freeze out the competition (sorry about that).
The key thing is that businesses have to do both things - review their core and evolve to remain successful and relevant. We don’t care whether you call it innovation, transformation, corporate development or anything else, but you have to see change in that way and be ambitious. One Head of Innovation once described their role to us, and it was better defined as back office improvement and, although valuable in itself, had little or nothing to do with equipping the business better for a future world.
All companies, big and small, need to continually change because the world is changing around them. You don’t need to appoint a Head of Fast Change to do that, but the culture of change needs to be embedded in your company or perhaps helped along the way with some external stimulus. In a workshop, one of our clients described the need to always look forwards and ask questions and that’s spot on. But do so with a lens on what you do now to make what you do better better and what you could do to grow, change and evolve.
So for all you ‘Heads of Innovation and Transformation’ out there – we’re sure you’re doing a great job but keep things simple so the rest of the company knows what you’re up to and understands how valuable it is. And we’re not picking on you we promise, we have come across a legal firm with a receptionist who had the wonderful title of Director of First Impressions!