In recent years, business leaders’ expectations in terms of innovation have grown. Though once satisfied with a new approach or incremental improvement, today’s leaders want better, faster and cheaper ways to create value. In seeking more control over innovation, they’ve established corporate innovation teams to help meet more ambitious innovation goals. To succeed, it’s critical for innovation teams to align business strategy with innovation strategy.
A PWC study found 54% of companies struggle with the alignment of innovation strategy to business strategy. Further, 65% of companies that are investing 15% or more of their revenue indicate that such alignment is their “top strategic challenge.” In the pursuit of value through innovation, corporate leaders are best served by thoughtful, fit-for-purpose strategy and execution that prioritizes organizational alignment.
One way to understand an organization’s ability to achieve its goals is through an alignment, capabilities and mindset model:
At best, organizations can quickly mobilize the right functions, with the right capabilities and the right mindset at the right times to create desired outcomes. In the context of corporate innovation, these three legs of the stool come together to support the greater whole.
Alignment is elusive. While capabilities and mindset are crucial to success, the alignment variable presents the most significant challenge for corporate innovation functions to bring new ideas to market. Though hailed as a panacea for growth, corporate innovation teams are constantly competing internally for people, budget and time with various parts of the business.
Internal prioritization, especially when innovation teams risk borrowing resources from projects that support core solutions, often leaves innovation teams at the back of the line. Strong organizational alignment, meanwhile, unlocks access to the capabilities housed in adjacent functions such as marketing, sales and beyond to deliver on promises of growth with new products and in new markets.
Some practical ways to build organizational alignment around innovation include:
Large corporations are not immune to short-term market pressure and competitive new products. But they can control how existing variables come together. Alignment is all about orientation with the goal to create a critical mass of people, all working together in the same direction, toward the same goal. Innovation efforts cannot sit outside this construct. Much like the trajectory of “innovation” as a buzzword, it is not enough to bring the alignment conversation to the top of an agenda. Demonstrating commitment through continued execution will drive success.