Mastering Innovation and Strategy: The Key to Business Growth
By: Hebé Lugo Nazario
Two of the most commonly used words in today’s business environment are innovation and strategy. Business leaders often say: “I want something innovative” or “I need a more strategic approach.” We hear these phrases so often that it raises an important question: Which is more important—innovation or strategy?
The truth is, they are not substitutes for each other. Successful companies, both locally and globally, allocate resources to both innovation and strategy.
Innovation is the process of generating new ideas that drive change within a company. It leads to new offerings, services, and products designed to meet the needs of today’s consumers, compete effectively, or even create new industries and business models. Innovation has existed since the beginning of time. However, it has become more relevant due to increased competition and rapid technological advancements.
But what is a great idea if it’s not executed? What if it’s executed incorrectly?
A great idea without proper execution can be very costly for a company. Furthermore, how many ideas have you had that ended up sitting in a drawer, never brought to life?
In a study of 392 local companies in Puerto Rico, over 75% had started an innovation program or strategic plan but failed to execute it successfully. The main reasons included:
- Lack of knowledge within the team on how to execute properly.
- Lack of time or commitment from team members.
- Overly aggressive ideas that lack focus.
- Insufficient resources.
- Poor communication with the team responsible for execution.
Without strategy, innovation lacks direction. And without innovation, strategy becomes stagnant.
The strategic development process is a continuous process that operates in the short, medium, and long term, allowing innovative ideas to be executed successfully within available resources and in a realistic timeframe. Strategy is the point where innovation meets execution and turns into real results.
To stay competitive today, companies need to work on both. Without strategy, there’s no direction, and without innovation, relevance is lost. For an integrated effort, we recommend:
- Being clear about who your customer is and staying aligned with their needs.
- Establishing a team within your organization dedicated to the process of constant innovation and experimentation.
- Testing your ideas as quickly as possible and moving on to the next one until you see the results.
- Integrating your team or strategic consultant into the equation early in the decision-making process. Together define what are the necessities to be successful, determine where how and when it will be carried out. And identify the process, resources and tools necessary to achieve consistent results.
- Assign a strategic leader within the organization to lead efforts and make decisions with your customers.
