Generate Higher Returns from Your Innovation Investments: 1 of 10

One way to establish market differentiation is through the introduction of innovative new products. Establishing that differentiation is one thing, but maintaining it is quite another. Here we have put together a ten part series on how to generate higher returns from your innovation investments. nnFrom our series of highly informational articles, companies will learn: how to treat innovation as a cross-functional business process, how to align innovation execution and business strategy; how to create sustainable innovation; how to train your senior executives to successfully execute innovation initiatives; how to effectively manage process and project management; how to measure performance of your processes; how to ensure broad stakeholder buy-in; how to understand the importance of product roadmaps; how to provide the tools necessary for successful product innovation; and finally, how to ensure that portfolio management coincides with process management. nnHere is one of the ten practices that leading innovators use to increase the payback from innovation spending: Treating Innovation as a Cross-Functional Business Process.nnInnovation as a Cross-Functional Business ProcessnnWhile it is not uncommon for organizations to view innovation as a technical process, relegated to the realm of idea generation by research scientists and engineering staff, for innovation to be truly effective however, it should be treated as a business process that supports strategic decisions throughout the life of a product, from inception to retirement.nnWhen you think about it, the various things companies must do to innovate successfully fall into the following categories: planning, investing, designing, manufacturing, supplying, or selling products. Most companies make substantial investments in systems to support the last four of these functional areas. However, when it comes to supporting the strategic planning and investment decision-making facets of innovation process management – points where organizations place huge bets to ensure their future success – many companies have no system in place!nnEffective management of innovation processes requires close coordination of daily development activities and the synchronization of product planning information across a broad set of stakeholders. Representatives from principal functions of the organization must be able to contribute easily and thoughtfully to a long-term, business-centric view of market and product opportunities to ensure investments are made in the right projects at the right time.nnAdditionally, recent studies indicate that more than half of senior corporate executives are dissatisfied with the returns their organizations are generating from investments in innovation. 1 At the same time, some organizations are realizing as much as forty to sixty percent more revenue and profit from new products than their industry peers. What sets these companies apart? nnFor more information on the top practices that leading innovators use to increase their returns on innovation spending, look for the next article of this ten-part series: Aligning Innovation Execution and Business Strategy.