Why Organizations Can’t Innovate or Improve

Introduction

Many organizations struggle to understand how to best innovate and improve. However, doing things the way you’ve always done them will prevent your business from scaling effectively. Your current processes and methodology have certainly made you successful thus far. But what if the market shifts or new products are introduced, causing your success to come to a screeching halt?

Most mature companies are structurally organized to manage their current (and successful) business model. In other words, all of the company’s structures, operations, teams, processes, and tools are focused around how you have always done business.

But every business model has a lifecycle—and lifecycles don’t last forever. It’s important to not let your current lifecycle run your business model. When the business model eventually starts to decline, so will your company. The job of modern business leaders is to separate these lifecycles—separate the lifecycle of the company and the lifecycle of the business models. Let’s take a look at ways to innovate and improve consistently by restructuring your organization, modernizing your business technology, and promoting positive conversations around change.

Structural Innovation

First, it’s important to look at organizational structure. Here are some questions to consider:

• Is there a ton of red tape and paperwork blocking your path forward?
• Do you have a lot of internal roadblocks due to bureaucracy?
• Do all your departments work in silos?

If you answered yes to any of these questions, that is a telltale sign of an innovation stifling machine. There are very few breakthrough innovations that were created with that structure in mind. In the age of this digital revolution, it is critical that companies shift their current paradigm and learn to be more agile. An agile organization is able to shift quickly and respond to changes in the marketplace or environment while keeping their focus on providing value to their customer and placating their shareholders.

Most companies get misaligned due to lack of transparency and focus on the customer, as well as bureaucratic roadblocks. Transparency, trust, and team empowerment are essential to creating an agile innovative organization. So, this may require some structural changes to promote and scale a culture of innovation.

Legacy Modernization

Technology is often the primary roadblock to business innovation. Legacy dependence prevents both high quality and timely product changes. Not to mention the technical debt that inevitably comes with legacy systems. Most businesses are worried about the technical debt that looms over every change you attempt to make.

When you find your company having legacy modernization challenges, holding off on modernizing is like holding off on fixing that water leak on your roof. At a certain point, it’s better to bite the bullet and invest in replacing your whole roof than to continue spending money patching up the holes that will eventually fail. Make smarter investments to improve legacy systems and better enable your teams to thrive in the future.

Legacy modernization is a must—not just a “nice to have.” If you want your company to innovate, you need to take a look at your technology design, infrastructure, processes, and people. Invest in making changes to modernize your organization.

Change is Hard

Let’s face it, change is hard. Many leaders understand the need for innovation but don’t know where to start. It’s hard to adapt! Especially with the constant changes in the digital world and the race to modernize faster than your competition.

Oftentimes, leaders in more mature organizations feel like their hands are tied behind their back. They want change, but how do they find the time or resources to help drive the change? And even with time and resources, how do you know how to best spend it? Implementing the right tools, resources, and processes to succeed in this is tricky.

How to Innovate and Improve Consistently

Innovation is no walk in the park, especially for larger companies. However, it is possible to stay competitive in your respective industry/market. What leaders tend to forget is that change doesn’t have to happen in one big bang. Small measurable changes can have a huge impact down the road.

Make a strategic data driven decision on what change to tackle first. Develop a hypothesis on the change you want to make, and test that hypothesis. Was it successful? Awesome, keep measuring. Did it fail? If so, make some shifts based on what you learned. Being able to quickly shift and learn from your mistakes will drive faster and better results to benefit growth.

In order to innovate, part of your organization needs to be given the freedom to explore adjacent areas of growth. They need to be able to consistently seek out new problems they can solve. The pain points of other companies will constantly be evolving. Learn to stay competitive and stay alive in the market. Startups are hungry to innovate and do things differently—can you?