1. INNOVATION
MANAGEMENT PROCESS
IMPLEMENT AND SUSTAIN INNOVATION IN
YOUR ORGANIZATION
AUTHOR: SHASHANK SHWET
SVP - UX AND INNOVATION FORTUNE COOKIE

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Innovation is needed but nobody knows how?
Objective: What is innovation and why do we need it?
Innovation is the new buzzword in use amongst the upper echelons of an organization. Senior
members of organizations are starting to appreciate the value of instituting innovation as a
process within the organization. Innovation management helps organizations, identify problems,
find relevant solutions and implement these solutions for business growth and sustainability. It
is the process to solve problems by generating a stream of ideas across the organization and
increase efficiency or enhance customer experience. Sounds great on paper right?
However, innovation initiatives usually lose steam due to a lack of clear objectives and goal
oriented, ROI driven planning of innovation programs. Also these programs fail to institute
innovation as a culture where employees are motivated to innovate on a daily basis. It does not
manage to get them involved.
The first step towards effective innovation management is to understand the basic need of
innovation. A company needs to evolve to keep competition and replacement products at bay.
New products need constant innovation so that they can tide over the wave of competition.
Then there are systems and processes that can be made more efficient with the innovative use
of technology. Hence innovation management results in better products, more efficient
processes or improved systems. This is in turn either increases revenue or decreases cost.
For example we can see innovation in a lot of products, services and systems around us.
LinkedIn users invest in Linkedin to reach out to a large number of people of a particular work
type or profession either to hire or to work with them. Google innovated on the hyperlocal
search and drove advertisement revenue away from print and television media channels.
Amazon, Jabong, Flipkart and the likes brought better convenience to users and still keep
innovating to deliver products more efficiently. Cash on delivery is an innovative solution to
entice the Indian user and lower the barriers of shopping online.

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Lean business is something most businesses want to achieve. This requires for organizations to
look inwards at systems & processes as well as outwards to actual customers and users to
enhance efficiency and improve customer experience. Innovation management allows business
leaders to achieve both these perspectives and plan sustainable innovation.
Innovation Management can be achieved in two major ways – organic innovation and inorganic
innovation. Organic innovation is when the company internally gears up to generate innovative
ideas. This can be achieved with each employee taking up a personal responsibility towards
innovation and the company as a whole trying to design better products, systems and
processes. This needs senior management’s buy-in for the idea and needs clear communication,
rewards and recognition to encourage this organic change in each employee. Innovation then
becomes a culture in the company and the company achieves innovation goals.
Large organizations also run programs to attract startups in their interested industry sectors. The
interaction with startups enables two things for companies – 1) It enables them to better
understand new ideas in design, technology and business models that they can adopt 2) it gives
the companies an easy target to acquire design, technology and businesses to strengthen their
processes and offerings. This method of acquiring innovation from outside the company is
called inorganic innovation.

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The Pillars of Innovation
Objective: To understand what foundation and pillars a company needs to build, to successfully
adapt to innovation management.
Innovation is a major organizational decision. Over the years of working with various companies
for innovation management, I have seen companies fail in implementing Innovation
management due to five main reasons. These are the foundation and the four pillars of
innovation management. The diagram below shows as to how innovation management is
supported by these four pillars.
The foundation: Tools Processes and Frameworks
Innovation management like any other project needs to be driven and process oriented inside
an organization. Hence this activity requires an internal champion – one person who is
responsible to drive innovation and take decisions. A clear hierarchy helps in quick decision
making and budgetary allocation. In addition the innovation management process requires
defined toolkits and process flows to guide individuals to generate ideas, file ideas, collaborate
on these ideas and work on a prototype. A defined process needs to prompt stakeholders to
think of problems, employees to provide ideas and solutions to these problems and the
company can collect, evaluate and prototype these solutions. It gets highly complicated in large
organizations and hence the right tools and processes are required as a foundation for
innovation management.
The Pillars of innovation management
1) Business Goals: Innovation management should always support business goals of the
organization or else you will end up with prototypes that have no business value for your
product or the customer. Hence, always align business goals with innovation goals.
Invest in areas and sectors in which the company wants to grow and ensure that the
entire organization is working towards a fixed set of problems. Microsoft is one of the
biggest case studies here – the Steve Ballmer – Steven Sinofsky episode. Microsoft ended

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up with two versions of Windows that needed high cost and post-sales support to
maintain. It took them another year to get this blunder sorted out.
2) Customer listening Posts: Organizations need to do everything they can to listen to
their customers. This requires for an organization to provide different listening posts.
Customer listening posts are those points that help the management capture what the
customers talk about you as a company or product. And each customer feedback helps.
Standard customer listening posts need to be enhanced with the advent of digital
products. Customer service call centers need to be enforced with chat based apps, self-
service apps and online reputation management. Customer listening posts become an
important factor to understand the pain points, likes and dislikes of the user and
accordingly steer your innovation program to solve those problems that will enhance
customer experience.
3) Metric Analysis – Each organization needs to create, measure, track and react to
metrics of all kinds. A metric can be any piece of information that defines the business of
the company. User growth, revenue, cost are standard metrics of the health of the
business. A detailed study of the different matrices needs to be done to provide the
three big hindrances to better growth of the company. These hindrances turn into
problems for the innovation team to solve.
4) Management Buy In – Getting involved in innovation management requires a dedicated
team and budgetary allowance for prototyping and testing. It requires the company to
closely look at metrics of each system and process. It requires setting up customer
listening posts. All of this cannot be done without a management buy-in.
With implementation of this foundation and the four pillars of innovation in companies with
internal policies, rewards and recognition and support for tools and frameworks – there happens
a change in the culture of the company towards innovation. Each employee gets more involved
in problem solving and constantly thinks of solutions to make his process and the company as a
whole better.

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How mature are we in the innovation process
Objective: To understand where a company stands on the innovation management scale
The Innovation Management scale helps organizations qualitatively evaluate where they stand in
implementing innovations within the organization. The scale is a factor of two matrices – the
number of ideas being generated in the organization and how large a group of people are
involved in the generation of ideas and solutions to listed problems.
The scale divides companies into four stages of implementing the innovation management
process - Novice, Intermediate, Apprentice and Expert. Each has been explained below: -
Novice: A novice company is one where only the founders or senior management think about
innovating to enhance customer experience or reduce cost. Although most founders and Sr.
management have a finger on customer problems they probably do not have enough time to
find a relevant solution – or at least to dedicatedly invest in the innovation process and find
solutions. Also in many large organizations there may be a disconnect between the
management and the ground realities of problems faced by customers. Such organizations
where problem solving is the responsibility of an elite few is in the novice stage of innovation
management.
Intermediate: Only those organizations that have experienced the benefits of innovation see
the value in institutionalizing the innovation process. Think of CavinKare creating shampoo
sachets to increase their sales or Apple releasing the iPhone to increase the company’s product

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portfolio. All these products where a result of Design Thinking and innovation management. A
company that invests in an R&D team to exclusively manage innovation and get this competitive
advantage in their value proposition to customers is in the intermediate stage.
Apprentice: Companies that inspire business line managers and executives to practice
innovation constantly, to find solutions to problems faced by customers or inefficiencies of
processes and systems are in the Apprentice stage. All 4 pillars and a foundation are necessary
for a company to adopt innovation management.
Expert: When the company can extend innovation tools and frameworks to every employee and
inspire them to generate ideas to problems the company is an expert in innovation
management.

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The Fortune Cookie innovation process
The innovation process is divided into three main phases: -
Problem Identification: This is the phase where a list of problems is identified through various
approaches. It includes listening to the customers, analyzing existing metrics and Stakeholder
interviews.
Ideas and Solutions: The problem list is published, a tool kit distributed and every employee is
encouraged to find solutions. Approaches like hackathons are followed to create an event for
innovation.
Implementation: The prototype of the top 5 problems are created and analyzed for market
readiness. In addition the product or the feature is integrated with the present digital strategy
and launched in the market.
The diagram below shows the three phases of innovation. A list of problem is generated in the
problem identification stage. These problems are shown in the diagram below with red balls.
This list is then circulated amongst innovators who are encouraged to find solutions to them. A
list of solutions is achieved in the solution finding stage. Each solution is vetted and the top
ones are chosen for prototyping. The selected ideas for prototyping are shown with blue balls.
Establishing Goals of innovation
It is important for the team and the stakeholders to establish the right goals for innovation. A
management level discussion is required to decide upon the money to be spent on innovation
and the ROI of the invested sum. Without these parameters in place innovation will always seem

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like chance rather than dedicated effort. A goal setting exercise needs to be done that will
define the industry segment, product portfolio, systems or processes in which the company
desires to go forward with innovation. The outcome, the blue balls in the above diagram need to
be defined clearly. Some of the features of outcomes are when and where innovation is needed.
Listed below are few questions which make a fair starting point:-
 Which Business line needs innovation to grow?
 Which geography needs innovation to grow?
 Which industry segment does the company thinks it will grow in?
 What are the users or customers saying about your business?
 Some very costly systems and processes that need redefinition
 Product improvements
This is not an exhaustive list. This list should be in fact the problems that the CEO or a business
manager notes down in his everyday routine. Fortune Cookie provides a toolkit to zero down on
the right problem list so that stakeholders can drive innovation in the wanted direction.
What is the objective of the innovation management process?
There are four main objectives of the Fortune Cookie innovation management process: -
1. Drive innovation towards a particular goal – business line, product, system or process,
in line with the strategy of the company
2. Drastically increase the number of innovators in the company and take the company
from Novice to Expert level in the Innovation Management scale shown above
3. With large innovators, come a large number of ideas. Hence a system and process to
manage the four pillars of innovation management shown in the section above.
4. Design solution prototypes and gather user testing and marketing testing results –
These prototypes will always be aligned with the goals established in point1 above.
The Process
As discussed above there are three phases to the process – Problem identification, Ideas and
Solutions, Implementation. Each phase is divided into two major steps as shown in the diagram
below. There are different approaches used to derive the right problem, idea to solution and
prototype. Each of these approaches is shown within the diagram. It’s only the second phase
that needs to be followed sequentially that has been shown in the diagram. For the others you
can implement the approaches in any order, as logistics permit. Fortune Cookie provides a
toolkit for each of these approaches.

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The six steps to guide through the objective of the process are shown in the red chevron in the
process diagram. These are: -
Steps Expected Output
Finalize goals Exact list of problems in the organization that
is affecting its revenue potential, costly
products, systems and process
Strategize Problems that need immediate attention
Capture Ideas A list of ideas from every innovator in the
company. A large organization needs tools
and frameworks to implement capturing
ideas
Evaluate short list Ideas A process to shortlist the right idea and
solution that fits in the company strategically
Prototypes Create prototypes with user testing reports
Implement Implement these prototypes in the company’s
product, systems or processes
Each step gives an output to the stakeholders and keeps in check that the innovation
management process is in line with the strategic thought process of the company.

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Process summary

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Implementation and sustenance of the innovation management plan
As discussed above one of the main objectives of implementing the innovation management
plan is to gather more number of innovators and more ideas and hence more solutions. This
results in a company prototyping a large number of products and all’s well that ends well. Right?
One of the most difficult parts of the innovation management plan is to implement it. Further it
is harder when it comes to sustaining it. In this section we are going to discuss this problem –
the implementation and sustenance of the innovation management plan.
Points to ponder for implementation
We have discussed earlier in the paper that we need management buy in. All the other pillars
and foundation also needs to be present for implementation. The other points to ponder are
culture Management and Digital by DNA.
If we need to drastically increase the number of innovators in an organization then innovation
needs to be ingrained into the culture of the organization. The HR department plays an
important role implementing innovation as a culture. One of the most direct ways of
implementing innovation thought process in an organization is constantly conducting Design
Thinking workshops. However, forced adult learning is not the best way to bring about culture
changes and often fails. An organization needs to create a system that incentivizes employees to
innovate using the right approach. One method is to generate a list of problems that is
periodically published and then have events such as hackathons to promote shared problem
solving and innovation amongst employees.
However, just publishing problems is not enough. Employees need to be taught how to
implement the innovation process and funnel ideas to achieve constructive solutions. Design
toolkits or online platforms to map ideas are the approach that should be followed. These
toolkits and frameworks should become the foundation of the innovation management process.
Launching an innovation management exercise gives an opportunity to senior management and
business stakeholders to ponder on systems and processes that need to be upgraded or
changed. In the last decade a large number of businesses have adopted to digitalization of
systems and processes to make them more efficient and cost effective a digital by DNA study
allows you to evaluate processes and find the right solution for digitalization. The right
problems are chosen and a process study is conducted. The pain points found in the process
chain are called out and added to the list of problems. A special study is done based on the
digital capacity of the process – basically asking question if the process in its current form has
the capability to be digitalized.
Points to Ponder on sustenance
Sustenance of innovation is based on the foundation and the four pillars. The stronger we are on
the pillars the stronger the innovation process would be.