Tibor Dőry

Innovation and excellence

Management methods for innovation transformation


Chapter 8. Initial steps towards a more innovative organisation

The introduction and continuous operation of internal entrepreneurial programmes can be a realistic long-term goal for traditional manufacturing companies and suppliers. As a first step, it is advisable to start with smaller, unique developments implemented using your own resources. Then, based on the success and experience of successfully implemented individual, project-based developments, it is possible to aim for the next level. According to international experience, the partial or complete development of a corporate innovation ecosystem should be formulated as a goal as part of corporate strategy. It is possible to delay and postpone raising innovation to a higher level, but valuable years may pass, and, similar to the analogy taken from sport, many companies that do not set increasingly ambitious goals may remain nothing more than unfulfilled promises and opportunities. Let us repeat: goals that are not set cannot be achieved! In the case of traditional businesses, it typically takes a generation to accumulate enough capital and experience to enable the company to move to a higher level of innovation and reinvest its profits in development activities without constantly having to look for government research and innovation grants.
Of course, actions and successful innovation projects are more important than ambitions, and these can be achieved even with more modest resources. Even with a few hundred thousand or millions in funding, significant efficiency gains can be achieved. Nowadays, developing new solutions and manufacturing and testing product prototypes no longer involves huge costs. Rather, it takes time and willpower to implement them and, most importantly, an experimental approach and motivation. Management must ensure that the success of innovation projects serves as a model and incentive for employees, who do not only expect guidance from management. Of course, this approach requires a certain degree of restraint on the part of managers and owners, who must master the techniques that will encourage their employees to be proactive. It is important that an innovative approach is expected not only from developers, but from all employees of the company. And if management and owners have decided that they really want to build an innovative organisation, it is essential that the company does not introduce an "idea box", or its more modern version, software or application, just for appearances, self-deception and brand building, but that management should view innovation as a real breakthrough and an important tool for corporate competitiveness. This may mean minor improvements or the search for radically new solutions.
There is nothing more disappointing for employees than not receiving feedback from management or the owner on their written or verbal innovation ideas. If they do not even receive a word of praise, a small gift or reward for the improvements they have made, it is unlikely that the company's employees will remain enthusiastic and seek innovative development opportunities not only occasionally but on a regular basis. In contrast, it is a step up if, in addition to recognition and moral and financial incentives, the company also makes a certain amount of resources available to internal entrepreneurs and innovators. All this can be complemented with a training programme, a few moderated workshops, and the involvement of professional business developers, and then we are practically talking about an accelerator or corporate accelerator programme. With sufficient perseverance and willpower, it is ultimately possible to create innovative organisations that apply design thinking and co-creation methods on a daily basis.
The stages of this development can be defined as follows:
Level 1: implementation of ad hoc development ideas;
Level 2: systematic idea management process, incentive and reward system;
Level 3: in-house incubation and accelerator programme, corporate innovation capital fund;
Level 4: co-creation based on design thinking and the application of open innovation methods.
 
After reviewing the conceptual models and wide range of tools for building an innovative organisation and a corporate innovation ecosystem, we would like to provide some immediately applicable guidance to businesses and professionals who are committed to developing a (more) innovative organisation. In recent years, we have tested various management methods and techniques in several small and medium-sized enterprises in Hungary, which are relatively easy to implement even in a traditional small or medium-sized enterprise and have a significant impact on the rocky road to building an innovative organisation.
During the interviews and discussions that preceded the selection of the various techniques, company managers often complained that they did not like meetings and workshops where enthusiastic employees presented their proposed development ideas, to which management had to respond. Due to limited resources, time and other constraints imposed by company activities, company managers often feel that these meetings are a "graveyard for ideas". By their own admission, they go into the meeting with a bad feeling and already know roughly how the evaluation will turn out. Because something has to be said! Yes or no! And here we return to the portfolio concept mentioned earlier in the book, which, when applied, can provide a completely natural and acceptable explanation for all concerned that not every project can be launched, only those that promise the greatest success and return, while the rest must be weeded out at the first milestone that is not met. The manager is doing the right thing when he or she stops projects that do not meet expectations and set indicators by a certain deadline in order to ensure the success of the other projects. Otherwise, the company will have neither the capacity nor the resources to continue and finance the projects that have made it through the screening process.
Both management and employees must accept that 80-90% of projects will be scrapped within the first few months, or at the latest within a year. This is particularly difficult in the case of the boss's favourite projects or his own projects. However, the experience of many innovative companies shows that a good boss is a leader not because of the number of ideas he has, but because of his leadership skills. It is important to recognise that everyone should focus on what they do best. The discontinuation of development projects should not be seen as a failure, but rather as a natural part of building an innovation portfolio. Of course, this cannot be achieved overnight. It takes years to develop an innovative – or, as we used to call it, ambidextrous – organisation, and if it is not done consistently, it can take decades and a new generation of owners. This is not an impossible mission, because Western corporate culture and the so-called knowledge economy are in fact based on such innovation mechanisms, which can be considered the art of invention and experimentation. This is why Central and Eastern European or even more Eastern companies do not understand why certain development centres are fooling around, why they spend so much time "messing around" with testing different prototypes, when all they need to do is tell them what they want, because "... it's clearer than day what customers want". Well, they don't know! That's why it takes so long to come up with and test product and service concepts. Remember that James Dyson made 5,127 (!) prototypes – that's not a typo – over five years before he won over the demands of discerning consumers with his bagless vacuum cleaner. The story seems simple from here, because based on the results of Dyson's persistent work as a former industrial designer, he has become one of Britain's best-known exclusive household brands over the past 40 years, and its founder has become one of the richest people and major entrepreneurs in the UK. All this has been achieved through design-based planning and continuous, systematic innovation!
The road to successful products and services on the market is a rocky one, with only a few – typically one or two out of a hundred – innovation projects reaching the market in the form of a new product or service. The first stage of this journey is the aforementioned "idea graveyard" of development, followed by the slightly sarcastic analogy of the "prototype graveyard". One prototype is no prototype! It is likely that dozens or even hundreds of prototypes need to be produced and tested in order to achieve the perfect technology (feasibility), aesthetics that satisfy the delicate demands of consumers (desirability), and economical manufacturability (business effectiveness). However, management can overcome the difficulties along the way with a number of confidence-building measures and careful attention. If the company successfully overcomes this obstacle, there are still critical issues to be addressed, such as production, preparation for delivery, selection of suitable partners and suppliers, sales, customer service organisation, and management of the entire value chain. It is possible to fail at this stage, but by this point, such significant investments have been made in development that there is a greater chance of avoiding the phase known as the "production preparation and market launch graveyard" than in the earlier stages (see Figure 31).
 
Figure 31. The path of innovative ideas to market – steps to building trust
Source: own compilation.
 
We do not wish to be pessimistic by presenting the obstacles that line the path of innovative ideas; on the contrary, we want to provide managers and developers with methods and techniques that can reduce the risk of failure. Mistakes, failed tests, misunderstood assumptions, or misleading research results are all natural consequences of innovative developments. Innovative small and large companies make dozens of mistakes every day, but they must learn from them and find ways to avoid repeating the same mistakes. A willingness to take risks and a desire for success can also help to smooth out the bumps in the road to innovation, and many obstacles that arise can be overcome with common sense. In this last chapter of the book, we present relatively easy-to-implement and deploy methods and management techniques that, based on international experience and feedback from our own expert activities, can provide effective assistance to both business leaders and employees involved in development.
 

Innovation and excellence

Tartalomjegyzék


Kiadó: Akadémiai Kiadó

Online megjelenés éve: 2026

ISBN: 978 963 664 182 5

The aim of the book "Innovation and Excellence" is to inspire and encourage company leaders, managers, and experts to initiate and implement innovation transformations with the help of professional literature and corporate case studies. Another important goal is to help develop the innovation capabilities of small and medium-sized enterprises in particular by sharing simple, proven management methods that can be tested in practice.

The first part of the volume reviews the factors of corporate excellence and success, then highlights the possible sources of innovation, with a focus on the role of users and employees. The empirical section presents a detailed description of the supportive role of the workplace environment and creative working conditions based on corporate case studies (AUDI, BOSCH, MELECS). The volume concludes with a description of selected tested practical methods and management techniques that readers can try out in their own businesses.

Hivatkozás: https://mersz.hu/dory-innovation-and-excellence//

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