Key Barriers To Businesses Innovation

Trent Weier

Regardless of their size, startups are disrupting even the largest businesses in ways no one eould ever have imagined. A well-known example is the way SpaceX has been able to disrupt the entire aerospace manufacturing and space transportation industry, almost overnight.

In a previous blog, “Is digital complacency putting your business at risk,” I discussed the risks, threats, and missed opportunities of not responding to this changing competitive business landscape where those who can innovate and adapt quickly are thriving.

The interesting thing is that many of the companies that have been disrupted saw it coming; in fact, many laid their industries’ foundation but are now unable to compete in a market they once dominated. Nokia is an example; Apple didn’t invent the smartphone, nor were they first to market with their product. However, their approach to innovation and customer-centric design philosophy has made them a trillion-dollar company.

So why – despite their size, their position in the industry, and their expertise – are companies like Nokia unable to capitalize on changing market trends, and what are some of the barriers to innovation?

Change is hard

We can all agree, change is hard, as at its heart is fear and unknown risk. A risk-averse nature contributes largely to many of the abandoned or failed digital transformation attempts within businesses today. Without acceptance of the potential risk of failure combined with a willingness to experiment, innovation within an organization will be stifled.

This is even more true for successful organizations who have a strong business model built on sustained growth and profits over the last decade or so. Why add unnecessary risk and complexity when we can continue being successful just doing the same thing? All too often I hear business leaders quoting the old adage, “if it ain’t broke, don’t fix it.”

However, as business model lifecycles become shorter and faster, traditional business models will inevitably decline, as will those businesses that can’t successfully decouple the operating model from the business model.

Slow innovation cycles

“Fail fast, learn often.” Nobody likes to fail, but in a highly competitive marketplace where budgets are tight, resources are scarce, and time is limited, fast innovation cycles to rapidly prove business value are critical. A reporter once asked Edison how it felt to have failed 1,000 times, Edison responded “I have not failed 1,000 times. I have not failed once. I have succeeded in proving that those 1,000 ways will not work. When I have eliminated the ways that will not work, I will find the way that will work.”

Unlike Edison, few organizations have the resources to maintain an innovation program that supports 1,000 iterations. The ability to experiment quickly, prove business value, or actively learn from failure while consuming the least amount of resources possible are key to delivering a sustainable innovation program.

Non-intrinsic IT

With the rise of the intelligent enterprise and the promise of data-driven intelligence and superior insights, today, more than ever, technology and IT need to be an intrinsic part of any organization. For many, IT is seen as a bottleneck or even an inhibitor of innovation due to resource constraints combined with the inherent system and process complexity.

By embedding intelligent technologies such as the Internet of Things (IoT), artificial intelligence (AI), machine learning, and advanced analytics directly into every business process, companies can transform into event-driven businesses enabled by technology rather than constrained by it. It is therefore critical for business leaders to ensure a clear strategy and vision with shared objectives for IT and the business to provide a platform for innovation allowing core competencies to be applied in new and exciting ways.

Lack of digital vision

“Fail to plan, then plan to fail” has never been truer than when it comes to the digital transformation journey. Organizations must ensure they have a clear digital vision and strategy based on addressing real business challenges combined with achieving real business outcomes. They must also ensure they communicate that vision and strategy within the organization.

There are two typical approaches to digital transformation, one focused on business process efficiency and the other on supporting future growth. The most successful are those that implement a vision that combines both approaches. It is also important to understand that it is not necessarily all about the technology; attracting the best digital talent and digital partners are also critical to successful digital transformation.

Want to learn more about how innovation can help drive greater business value in your organization? Please visit Innovation at SAP – Innovating Together.


Trent Weier

About Trent Weier

Trent brings 15 years of technology strategy, execution and digital value creation experience to SAP and its many customers. As a member of the industry value engineering team, Trent is focused on the chemicals, energy and natural resources sectors, showcasing to customers the business value of challenging traditional business models while creating disruption through industry leading innovation.