As a life-long entrepreneur, I have followed a variety of career paths. While I may not have considered myself a woman business leader at the time, as I look back at my choices I can see that I made some pretty progressive decisions early on in my career. At the time, I knew I was discarding the status quo but I would not have actually qualified my decisions as ”innovative.” I can see now that my penchant for taking calculated risks could be interpreted that way!
I thought a recent article by Thomas D. Kuczmarski on businesses that are innovative offered some great pointers for business owners and entrepreneurs. Here are some results of his survey of 87 U.S. product and service companies:
- An innovation strategy counts
Sixty-six percent of the successful companies have an explicit innovation strategy that is aligned with the overall corporate strategy. Only 22 percent of the unsuccessful firms have such a strategy.
- Focusing on high-risk—but higher-return—innovation matters
In successful firms, 26 percent of new product and service revenues come from new-to-the-world innovations. Among the unsuccessful, the figure is just 7 percent.
- Innovation leadership is central to success
There is a clearly defined innovation leader in 64 percent of the successful companies; 50 percent of unsuccessful firms have such a leader. The two numbers seem oddly close until you understand that in the successful firms, the innovation leader reports to the CEO in 47 percent of the cases—compared to 15 percent among unsuccessful firms.
- The CEO must be the innovation leader
In 62 percent of the successful firms, the CEO is active in the process of planning new products and services, compared with 30 percent of the unsuccessful firms. The reasons we heard for the failure of new products or services include poor planning and execution, lack of understanding of market needs, and lack of internal support. Overall, fully 68 percent of the reasons given for innovation failure were things that can be controlled by an organization.
Innovation is a word that is easy and convenient to say. Making it happen is an important leadership role!