Innovation and Strategy – Organizational Design Strategy

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Innovation and Strategy

"a digital Argonaut" digitalargonaut2@gmail.com

Innovation

What is innovation?  Well it’s going to depend on who or whom you ask the question.  The purpose of this blog will try to get past definition and get down to what’s behind the words and what people need to do to get work done.

Innovation – is ideally ingrained in our culture, employees are encouraged to innovate and leaders reward the employees for their work towards the goal of being an innovative company.  The ability to measure a culture of innovation is far more subjective than any other performance measure.

  • Innovation may be the way employees communicate about the newest offer the companies working on.
  • Innovation may be the way a current offer get’s repositioned or different components used to increase functionality or add features.
  • Innovation IS NOT usually an upgrade to a current operating system.

For the sake of argument let’s use the same descriptions above and add a few points of interest often not known or understood by the various functions even in cases where the resources are highly effective, we are unlikely to know what we don’t know.

Stakeholder and Operational Requirements

  • High risk offers are the new inventions or offers that are NOT in the market and the industry analyst are decision makers about the readiness and category which the offer will be reported and measured against.
    • The inventions a company and the shareholders/investors agree to accept a certain degree of risk, these are risk to these executive level stakeholders and the organization or agency must acquire a different type of insurance as part of the companies overall risk management portfolio.
      • Insurance for the Directors and Officers (hold harmless – any fines are paid by the insurance in cases of a new offer causing monetary damage)
      • Insurance for all investors and shareholders to prevent loss beyond the investment or percentage of the company where accepted risk was authorized.
  • Medium risk offers are often a way a few existing offers may be segmented with a new acquisition offer improving the offer.
    • The industry analyst will determine the new offer is now advanced which has a footnote to describe the advanced technology as a dollar amount of the GAAP moved to non-GAAP revenue reported.
    • An organization or agency offering advanced technology offers has a greater risk if the features are ahead of their time as the consumers may not be prepared for the offers requirements for more power as an example; or the ability to monitor everything in our homes as another example.
      • Neither example implies negative offers – the power must be available to the person buying the offer or the laws adjusted and value streams promoted early and often.
    • Typically the advanced offers are going to be taken through an early market trial with the largest customers in the world.
      • The power requirement would be identified by a large customer quickly and preventing any adverse effects on a small or medium customer and ideally before any consumer or civilian was negatively impacted.
  • Low risk  offers are generally not going to change instead these are continuously improving.
    • The improvement would be a change and moving the low risk item to the medium risk during the execution of the change enables the organization or agency to run without disruption to the other offers.

Strategy

What behaviors are associated with the three types of offers?

High Risk Offers

  • High risk offers are determined by industry analyst after comparing the market and who are the likely competitors.
  • High risk offers are very confidential, the patent process must precede any external announcement.
  • High risk offers require a number of early field trials working closely with your customers.
  • High risk offers must document far more Research and Development than either medium or low.
  • High risk offers are more costly to an organization for longer periods of time.
  • High risk offers require your highest skilled resources to ensure all testing and new product introduction processes have been met.

Medium Risk Offers

  • Medium risk offers are determined by industry analyst after comparing the market and who are the likely competitors.
  • Medium risk offers are high confidentiality although the patent process is generally complete and the offers gone to market
  • Medium risk offers might be the way an acquisition offer get’s repositioned under the acquiring companies brand.
  • Medium risk offers may be organizing components from other offers into a different offer entirely.
    • The ability to valuate the components
  • Medium risk offers are typically a footnote on the income and loss statements filed with Security Exchange Commission agencies.
    • Medium risk offers typically infer higher skills than a general employee and often are best aligned to a business function certification
      • Beyond formal degrees
      • Includes earned wisdom from experience on the job
  • Medium risk offers require a second tier of invested learning from your channels before allowing these types to be supported by your resale model.

Low Risk Offers

  • Low risk offers are determined by industry analyst after comparing the narket and who are the likely competitors each year.
  • Low risk offers are generally going to have a tremendous amount of published material online and available to general public.
  • Low risk offers are typically the bread and butter of an organization or 70% or higher of the activities in the organization.
  • Low risk offers are passed the testing and rarely considered innovation, the continuous improvement model works well with this stage of maturity
  • Low risk offers are generally high volumes of transactions and low dollars
    • Often supported by channels or resale models

Party Management

Design Strategy and Vision-the first process will need to move beyond chaos into execution more effectively.  The challenge in this regard will be aided by segmentation as shown above.

The people part of any business aligns to each level;

  • Customers align to each level above by size of the organization.
  • Suppliers align to each level above by maturity or whether you are in a strategic or maverick supply chain model.
  • Employee competencies align to each level above.

Financial Management

The ability to do a good job measuring our performance on innovation has been hindered by the lack of resource alignment to maturity of your offers.

  • A finance has few resources skilled in Project Accounting, therefore the measurement system is very subjective.
    • Ideally we needs to adopt ABC accounting which is another way of referring to project accounting.

Motivation

What is the motivation for this type of solution?

  • Organizational Design Strategy
    • Governance by design-enable roles based access, gets beyond business rules that everyone must understand and transfer into execution.  Supplies the boundaries for employees to work within.
      • Allows discreet oversight without forcing change
      • Allows different levels of risk based on internal organizational decisions
      • Extracts the design patterns only a person with proven experience and earned wisdom across-industry, across-geography and all size organizations.
    • A guide rather than constraints, promotes your current culture with access to the “outside in” allowing focus on the customer by types and behaviors.

I look forward to hearing your thoughts and feedback.  Ideally, you will challenge my model.  Yes, I welcome the chance to prove the design meets the business need, in any industry, in any geography and any size organization or agency.

 

 

Author: Lisa Marie Martinez

A person who continues to prove the impossible; is possible. A wicked problem and the various messes left behind by these problems are often analyzed as parts rather than synthesized from the whole then into parts. We (EA/BA's) must be the voice for the whole allowing the functional parts a guide to adjust and respond to the changes in market which lead to new strategies and approaches to execution.

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