How do you deal with the situation where you're supposed to innovate but have no budget?
It is a situation many find themselves in. Managers, especially those who think that it is possible to create an innovation culture, believe that all it takes to make innovation happen is throw people at the problem. In some organisations, in fact, it is far easier to assign people than budget anyway. It seems, therefore, that creating a team is an easy way to get innovation started.
The issue with this is that making innovation happen is not just about ideas and people. It also requires execution, which is the difference between an idea which sits around gathering dust, and one which can actually be converted into something that creates revenue. Execution, usually, requires money.
Innovators with no financial resources at all almost always fail and the reason is this:
Before anyone can make an investment decision in something new, there are three key questions which need to be answered. The first, which is "can we do this", is really technical: are the technologies, production capabilities, management systems, and other artefacts needed to create the innovation available? If not, can they be created at a reasonable price? The second question is "Should we do this", which is actually about the financials of the innovation. And the third question is "When?", which has to do with market entry timing.
In order to get the answers to these questions, the innovators will probably have to pay for research, prototypes and the time of analysts. It is rare that an innovation group will have all these capabilities in house.
Consequently, an innovator with no money at all has almost no alternative but to try to answer all the key questions him or herself. This mostly results in exceptionally poor business cases, due to the lack of any substantive detail. The result is innovators wind up tossing poorly formed propositions at stakeholders and hoping for the best. Usually, they don't get taken seriously. - 31960
It is a situation many find themselves in. Managers, especially those who think that it is possible to create an innovation culture, believe that all it takes to make innovation happen is throw people at the problem. In some organisations, in fact, it is far easier to assign people than budget anyway. It seems, therefore, that creating a team is an easy way to get innovation started.
The issue with this is that making innovation happen is not just about ideas and people. It also requires execution, which is the difference between an idea which sits around gathering dust, and one which can actually be converted into something that creates revenue. Execution, usually, requires money.
Innovators with no financial resources at all almost always fail and the reason is this:
Before anyone can make an investment decision in something new, there are three key questions which need to be answered. The first, which is "can we do this", is really technical: are the technologies, production capabilities, management systems, and other artefacts needed to create the innovation available? If not, can they be created at a reasonable price? The second question is "Should we do this", which is actually about the financials of the innovation. And the third question is "When?", which has to do with market entry timing.
In order to get the answers to these questions, the innovators will probably have to pay for research, prototypes and the time of analysts. It is rare that an innovation group will have all these capabilities in house.
Consequently, an innovator with no money at all has almost no alternative but to try to answer all the key questions him or herself. This mostly results in exceptionally poor business cases, due to the lack of any substantive detail. The result is innovators wind up tossing poorly formed propositions at stakeholders and hoping for the best. Usually, they don't get taken seriously. - 31960
About the Author:
Before you begin your innovation group, you need to consider the funding options. James Gardner's free online innovation book has material you should consider.
