Innovation is a mindset

According to a recent global survey, 54% of CFOs describe themselves as ‘uncommitted innovators’. Change can be scary – not least for CFOs trying to stand up an innovation investment case. Breaking down the challenges; justifying change with rigorous, data-driven insights; and targeting projects at well-articulated pain-points are all ways to get over the mental block.

These “uncommitted innovators” are defined as ‘would like to be more innovative but rarely get the time, funding or support from the rest of the board to invest in finance process innovation.’ The good news? More than a third of CFOs self-identify as early-adopters of technology and play an active role in innovation across their organisation.

One problem for the half of CFOs struggling to innovate is that it’s hard to overcome the mental blocks to change. Innovation demands investment of time and money – but also requires an appetite for risk, a willingness to fail and the leadership skills to bring employees, peers and customers along a potentially difficult journey.

But perhaps the real problem is that ‘innovation’ often conjures up ideas of painful and disruptive change. It’s too easy to lose sight of the small, practical and incremental innovations that aren’t necessarily ‘disruptive’, but which build towards sustainable change.

And for most organisations, its iterative product launches, service enhancements and scouting projects ought to see the bulk of innovation efforts. CFOs understand this as building an options portfolio – with a blend of risks, investment requirements and potential returns.

Within a portfolio, it pays to look at the different types of innovation, too. Specialist consultancy Doblin (now part of Deloitte) lists ten. Assigning innovation projects to these categories is a great way to understand whether you’re seeking to solve pain points in the business, defend your existing markets or create new ones. It also helps prevent mission creep, which can quickly turn practical innovation projects into unwieldy basket-cases.

Doblin’s model breaks the ten types into three categories: configuration (changing the way you do things); offering (changing what you do); and experience (changing how that’s perceived and delivered). That’s also a useful way of targeting the way innovation projects might shift the business model, breaking down the process into a clear, compartmentalised concepts.

Take RPA as an example. “The great thing about RPA, says Mark Hulyer from Deloitte, is that allows organizations to streamline, expedite and efficiently monitor the close process and its sub processes from start to finish. Taking a crawl, walk, run approach here can be ideal where the first implementation, or first evaluation of RPA, can focus on a high value area such as, for example, performing reconciliation, allowing a team or a manager to get a taste of what RPA is really able to do. And then, as people become more and more comfortable with what automation really has to offer, start tackling more and more complex areas. “

Make innovation simple and straightforward, and the minds and bodies will easily follow.

Look at how other business leaders are building innovation into their growth agenda.

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