Is Your Budgeting Process Killing Innovation?
Investing In Innovation And Emergence
In domains with little variance and mass repetition, predictable and repeatable processes and operational management can prove to be most efficient. However in our world today many companies are being disrupted as a result of globalisation and digital technologies. Having an operational budget forecast only without slack for emergence can be expensive. The successful companies of tomorrow will be those that have developed a responsiveness through adaptive management to capitalise on emergence today.
When forming the Lean Product Lifecycle, a common issue we faced sat within the perception of innovation and traditional management. New innovations would only be seriously considered with large traditional business cases with 3 – 5 year projections in their early stages. There is also a common perception that Innovation being only the capture, ideation and formation of new ideas or to put it another way, creating sparks.
Without financial backing and the appropriate opportunity growth lens though, consider how many of the these sparks don’t turn into fires as they are starved of fuel. This fuel which could be used to breath life in your companies future product range, is sat wasted across the organisation supporting less valuable investments. If you have an internal incubator, how many potential innovations sit at the gate as there is no budget for them or they don’t have a good enough quality business case? (Do you train people in business case creation to know what good looks like to translate great ideas into the business language?) Alternatively how many great ideas are met with the death pause where they are not the priority today?