| | November 20168CIOReviewBy Armin Roeseler, CIO, DirectBuyCreating a Sustainable Innovation ProgramWhat is Innovation?Innovations create value propositions that people are willing to pay for. They inspire game changing outcomes for a business by meeting new consumer requirements, or satisfying previously unarticulated--but existing--market needs in new, imaginative ways. Furthermore, impactful innovations create discontinuities in existing business models and elevate the business plateau to new levels. As such, innovations do much more than just incrementally improve sales or other desired business outcomes (e.g., market share), but they "move the needle" appreciably and, in addition, create new and unpredictable circumstances that can disrupt entire industries. This business transformative effect is often accomplished by leveraging new technologies (e.g., Internet; mobile technology) to either create IN MY OPINIONnew products and services, or by instantiating entirely new business models. For example, to satisfy existing needs for home entertainment viaon-demand rental movies, Netflix upstaged an entire industry by promoting a completely new movie delivery method (postal mail; Internet) compared to existing brick-and-mortar rental locations (e.g., Blockbuster). Apple's iPod devices not only introduced new device characteristics of how personalized music is stored and delivered to consumers, but through its integration of the iTunes store and additional desktop applications created a completely new user experience and ability to manage music.Historically, businesses largely relied on strategic planning and execution of the business strategy to be successful. Due to globalization and ever more rapid technology obsolescence and turnover, however, even planning for the next quarter is a challenge today; committing to decisions that will play out in a few years is extremely difficult. On the other hand, to keep doing the same thing repeatedly is no longer a recipe for success for many companies, as it can drive a business toward obsolescence in fast changing industries. Many companies are looking for innovation as one of the top drivers of growth in the near future to counter this development.To create a successful and sustainable innovation process, new thinking ("Innovation Thinking") that enables leaders to operate successfully in challenging and unpredictable circumstances is required.Why is Innovation Thinking hard?Innovation thinking is different than traditional business thinking. It represents a crucial addition to traditional business thinking for organization that wish to establish an innovation process, and to create a climate for innovation within organizations to ensure continued health and future viability of the business.In business thinking, when faced with a problem, our immediate instinct is to address it with order; to examine and analyze the situation; to look for logic until we understand the problem and know what to do based on past experience. This approach, however, fails when complex problems and circumstances do not fit previous patters, and a paradigm shift has occurred that presents an entirely new business situation and context. In those situations, solutions are not immediately obvious--thus requiring innovation thinking.What are the Elements of Innovation Thinking? Rather than relying on traditional market research, formulas and logical facts that attempt to remove ambiguities to drive results, and trying to find the "right answer" by looking for precedent to inform decisions, innovation thinking does not rely on past experience or known facts. Instead, it imagines a desired future state that is unconstrained by past experience,and determines ways to get there: the goal is to find a better way and to explore
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