Module 2•Unit 2 of 5•13 min

The Four Strategic Outcomes

If innovation is a means to strategic ends, what ends can it serve? To appreciate the strategic goals a business might pursue, it helps to understand what innovation is actually capable of doing for a business. Four key strategic outcomes stand out - and every worthwhile innovation effort should trace back to one or more of them.

Responsiveness

The ability to react quickly and effectively to change - new customer needs, competitor moves, technology shifts. Innovation gives a business the agility to respond rather than be caught flat-footed.

Relevance

Remaining consistently valuable and desirable to the market from season to season. Innovation keeps the offering aligned with what customers actually want as their needs evolve.

Resilience

The capacity to withstand and adapt to the grand sweep of change - to survive shocks and disruptions across generations, not just seasons. Innovation lets a business reinvent itself before it is made obsolete.

Growth

Expanding the value the business creates and captures - new revenue, new markets, new margins. Innovation is one of the few reliable engines of genuine, sustained growth.

Two timescales

Notice that these outcomes operate on different timescales. Relevance is a season-to-season concern - staying wanted as tastes shift. Resilience is a generation-to-generation concern - surviving the big waves of change that reshape entire industries. We will return to this distinction in Module 3, where relevance maps to renewal and resilience maps to reinvention.

Quick poll

Which of the four outcomes does your organisation most need from innovation right now?

Pick the answer that fits you best - there's no wrong choice.

Responsiveness, relevance, resilience, and growth are the destinations. Innovation is the vehicle that gets you there. Whenever you launch an innovation effort, be explicit about which destination it is driving toward - it will shape every decision that follows.

Discuss

Pick your organisation's most important strategic goal for the next three years. Which of these four outcomes does it depend on, and is your innovation effort actually aimed there?

Try this at work this week

Label each of your team's current innovation projects with the primary outcome it serves - responsiveness, relevance, resilience, or growth. A cluster in one column (or a gap in another) reveals a lot about your real strategy.

Sources

Global Innovation Institute (GInI), Foundations of Innovation body of knowledge.
Reeves, M. et al., "The Biology of Corporate Survival", HBR, 2016 (resilience).
Pisano, G., "You Need an Innovation Strategy", HBR, 2015.

A Means, Not an End

Avoiding Innovation Theatre