the EIM approach to compete in the digital age
Today, innovation is not an option for companies facing global markets. It must be actively pursued in order not to be cut-off from the market. Innovating means adapting to a series of changes, first of all competitive and market but also technological, operational, organizational, and cultural. Managing these changes reactively has a huge opportunity costs, and therefore a proactive approach is necessary.
To remain competitive, it is no longer enough to improve existing products and processes.
We are in an era of transformation, also accelerated by the thrust of digitalization, which involves products, services and processes by redesigning entire traditional business models from scratch and always rewarding those companies that prove to be truly innovative.
We must be daring, therefore innovation in the company must be replicable and planned in a continuous and reliable manner. We need a process and a mindset that involves and motivates all the resources that are part of the organization to build an environment capable of welcoming change and then unloading it on the ground.
The great race to digitalization
From a strictly technological point of view, digitalization is driven by a variety of inventions, ranging from artificial intelligence to the Internet of Things, from advanced robotics to blockchain, but also by new materials and new processes that strongly impact the productivity and on all the organizational dynamics of companies of all sizes.
Today the word “innovation” is overused, but there is still a big gap between theory and practice. Why have so many companies not yet started a real business innovation process? Because they are often satisfied with the products and services that they already offer to the market and, fearing to lose short-term profits and cannibalize the existing, they do not invest enough in research and new ideas. Either because they have risk-averse internal people and culture or they have not yet developed a clear model that supports constant innovation.
Thanks to our 35 years of experience and a network of more than 30.000 managers selected for their experience, versatility and the concrete ability to “make things happen”, EIM is able to support companies by developing and implementing a digital innovation plan. Anywhere in the world.
No business leader when asked whether his company is innovative or not will answer no, but innovation is not a matter of opinions or points of view. There are several indicators that measure more or less objectively how innovative a company is, a series of measurable evidence both in terms of investment and in terms of human capital made available.
Innovating in the company means taking risks
Innovation is a risk, but in EIM’s experience there are many cases in which the decision to set up a real innovation strategy has been thrown a lifesaver to companies in difficult market situations. A smart and far-sighted investment.
The launch of a business innovation plan usually requires company capital. It is difficult to finance it with classic public or private debt instruments due to the intrinsic characteristics that make it an activity whose returns are never certain. Innovation costs and it is rarely possible to finance it in the long term with external instruments. it is a problem that can only be overcome by reinvesting part of the company’s profits or directly by the entrepreneur from his own pocket on new ideas, technologies and internal and external innovation processes.
Wanting to establish a benchmark, the average measure calculated by EIM to be allocated as a share of investments relevant to basic research and innovation is between 10 and 30% of the R&D budget, also depending on the type of industry and the context. competitive reference.
The value of “diversity”
The innovative company must have suitable and qualified skills and professional managers from different cultures and disciplines, as well as constantly updated technological expertise, that can boost international professional paths and make up a differentiated corporate culture. The diversity of gender and origin is always a prerequisite for renewal and is a fertile ground for producing opinions, ideas, comparisons, “creative chaos” (only) from which innovations can arise.
To pursue only well-defined processes, designed to maximize efficiency, to have in the company only people who have mastered the specific experience, the repetition of activities and objectives, an R&D team made up of excellent “elderly” technicians, not very open to new stimuli and external and constantly self-referential, it may produce a well ‘lubricated’ company, but it makes it difficult to become skilled in experimentation and in the search for new ideas.
Companies are often quite innovative when they are young or when they are constantly contaminated by stimuli and cross-fertilization.
Grounding innovation: EIM’s added value
Innovation is 10% creation and 90% execution.
The real stumbling block for those who want to propose technological innovation in the business environment is not so much that of conceiving ideas, but rather knowing how to evaluate, manage and then put them on the ground,
activating an “industrial” process on them to build an offer of value for the market or to produce a leap in performance in internal processes. While the ideation phase is intrinsically chaotic due to the creative sources and the multiplicity of waves, the modes of inspiration, the uncertainty, the different iterations, the loops with the market and users, the research and experimentation, the development processes and industrialization, however, must be organized quickly and in order.
In its experience, EIM is able to provide its know-how and choose the best strategy, step by step, to ground innovation, favoring the activation of processes that do not necessarily imply a radical organizational change of the business and current operations of the company, but which bring the necessary specific changes through the creation of dedicated teams and resources – business developers, project managers, sector and technology experts, steering groups – who can operate across functions or as an organization ‘shadow’ dedicated to innovation.
The models with which innovation is grounded are essentially two: the one that provides different gates and phases and the one known as “Lean Start Up”.
The first model provides that each new idea goes through a well-standardized process of phases, in which innovation must be gradually explored and enriched with attributes and at the end of each phase a decision gate based on pre-defined criteria is provided. In the event that the evaluation is positive, the idea progresses to the next stage of the process and receives the necessary additional funds.
The “Lean Start Up” methodology, on the other hand, aims to develop new products and businesses by moving much faster from conception to validation, testing the assumptions and the expected value of innovation in real practice, in the satisfaction or use of users, to reduce the risk of investing in things that the market does not recognize. The second model is not necessarily better than the first.
The phased strategy works in situations in which innovation is more push, driven by technology, in a highly predictable context, for example typically in the mature sectors of machinery or mechanical components B2B.
The “Lean Start Up” has a much more pull approach, ie guided and market-oriented and works well in sectors where there is high volatility, uncertainty in demand, rapid product cycles.
It is not just a matter of agile and well-structured execution processes: we also need an innovative vision and culture of the company, supported at all levels of the organization – from top management to the last employee – and a corporate team spirit that participation, initiative and sharing are a fundamental value and an essential point of the strategy.
EIM – There Where You Need Us. Anywhere in the world.
EIM operates as an integrated global company from 30 offices around the world. Over the recent 35 years, we have developed a working relationship with more than 30.000 managers during 10.000 projects. We are able to support you anywhere in the world by closely monitoring the assignments of managers with very good experience of the culture and markets concerned.
Mexico, Shanghai, Mumbai, or Munich, despite the distance, you can count on the support of our local or international experts to ensure the success of your projects.
Bohuslav Lipovsky, Managing Partner EIM Executive Interim Management CEE Together we can find the solution you are looking for