Your Step By Step Guide Towards Improving Innovation & Building Cross-Functional Teams In 2020

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Riley Moore
CEO of RM4Tech & Co-Creator of DirectSuggest

The amount of innovation within an organization defines a spectrum. Some companies like Apple and Amazon are incredibly innovative; other companies like Blockbuster and Polaroid are not. Like everything in business, once you instill the proper principles and routines innovation will improve. No matter where your organization falls in this spectrum, it can always improve. Below are what effective business executives do to spark innovation as well as eight methods any organization can use to generate innovation.

Effective Business Executives Already Do The Following:

1. Ensure that their organizations understand their customers' needs
2. Establish collaborative relationships with their business partners
3. Allocate resources for training and development
4. Create a culture for change and continuous improvement
5. Model and reward the behavior they want from others
6. Incorporate external business practices that align with organizational goals

Eight Methods Companies Can Use To Generate High-Quality Ideas For Innovation:

1. Increase investment in idea generation
2. Develop customer understanding
3. Ensure executives are focused, on board, and sponsoring the initiative
4. Establish a favorable company culture
5. Use outside sources for ideas effectively
6. Partner with suppliers for new ideas
7. Dedicate additional resources towards innovation
8. Provide incentives and rewards towards innovation

To Run Successful Innovation Programs, The Focus Of Companies Should Be Four-Fold:

1. Leverage networks of internal and external partners to increase the volume of ideas and solutions to business problems.
2. Ensure visibility across the entire organization and set up processes to track the success of innovation initiatives.
3. Innovation project managers must anticipate downstream challenges and make informed decisions on decisions.
4. Reward systems for teams working on disruptive ideas should be different from those that are followed by the rest of the company. Organizations must work to create an environment that mimics the collaborative start-up like environment. This allows innovation teams to collaborate across functions to bring new ideas to life.

For Companies To Assess Their Innovation Initiatives And Benchmark Them Against Those Of Competitors, They Use Ratios Associated With:

1. Percentage of sales generated through NPD
2. Percentage of net sales invested in R&D
3. Time spent by key stakeholders
4. Number of patents filed or granted over a specified timeframe
5. Examples of innovation tracking measures (identified through Evalueserve’s interactions with organizations across industries)
6. R&D Innovation Efficiency – Ratio of sales from new product launches and total expenditure on R&D
7. Return on Innovation Investment – Ratio of gross profit earned from innovation and the cumulative investment period
8. Innovation Success Rate – Ratio of ideas commercialized to the total number of ideas
9. New Product Success Rate – Measured against a set of target parameters that include consumer acceptance, technical acceptance, and gross margins
10. Consumer Satisfaction Index – Measured through consumer surveys to assess product performance, the effectiveness of marketing activities, and response to FMOT/SMOT
11. Break-even Analysis – Detailed P&L to estimate the expected time to recover investments made in NPD through product sales

Sparking Innovation By Setting Up Dedicated and Cross-Functional Innovation Teams

A simple way to build a culture of innovation is to connect business leaders and project teams to relevant external experts quickly and inexpensively, so they can experience open, “boundary-less”, innovation first-hand.

The processes across the innovation value chain require significant cross-functional involvement. Sales and marketing gather specifications and needs through numerous consumer interactions. Research & Development identifies possible technology solutions to meet those specifications/needs. Lastly, manufacturing, engineering, and packaging turn a concept into a scalable product.

It is essential to ensure collaboration to translate concepts into tangible products. For a successful innovation program, companies must develop collaborative teams that exhibit an entrepreneurial spirit, diversity, and are not prone to functional fixedness. An ideal structure for a cross-functional innovation team is one that provides cross-functional skill sets to stakeholders across the product development value chain. The program should aim to improve business know-how and entrepreneurial skills while helping the management identify and implement real innovation.

By combining expertise in business strategy and technology, companies can identify ideas that have a higher likelihood of success, and then direct resources to bring these ideas to fruition.

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Riley Moore (https://www.linkedin.com/in/rileyrm4tech)
Riley Moore, the 25-year old CEO at RM4Tech, the one and only completely family-owned family-run software company, has used his mix of technical and business influences to bring his creative vision to life. With the development of RM4Tech’s first solution, DirectSuggest 'The Suggestion Box Reimagined' , he has become a fresh face in the world of engagement and innovation. Their second solution CrowdQuestion was released in early 2019. CrowdQuestion is focused on connecting crowds through 'Q&A The Right Way' to bring everyone closer to their community. His passion to empower individuals to use their creativity and voice to make a difference in the world is what drives him.
Riley's love for podcasting, mixed with his unrelenting drive to inspire individuals to change the world through passion and hard-work, encouraged the creation of The Moore You Know Podcast. He hopes to impact the world through entrepreneurship and podcasting like those who inspired him.