Is innovation a strategic imperative for every business?
This was the question the SRB partners asked a select group of CEOs who attended our CEO Forum in Melbourne last week. We knew it was a big topic that would lead us down all sorts of rabbit holes, and we were interested to hear what this group of sharp minds had to say on the subject. We weren't disappointed.
Three mega-trends – technology, globalisation and a burgeoning global middle class – are not only a preoccupation for public policy makers, they are also front of mind for business leaders and tech innovators from here to Silicon Valley and beyond.
Why? Because everything we thought we knew, has now changed.
A power shift from supplier to consumer has been enabled by the arrival of some very new kids on the block – democratised data, the internet of things and Artificial Intelligence. This change is nothing short of revolutionary and you could argue that people have never had so much power at their fingertips. As with any revolution worth its salt, disruption is the new normal.
As recently as three years ago business transformation was a cutting-edge concept, now it's business as usual. Decision makers are needing to rethink not only how they use data to drive strategy and create a compelling vision for their brand, but also the skills-composition of their workforce so they can make sense of this new data-driven reality.
Tiziana Pittui, Insights Leader at MGP&Co, observed that demand for graduates with data analysis skills seems to have accelerated in recent years. For Tiziana, analytics isn't an end in itself and there still needs to be a pathway between the ability to crunch data in ever increasing minutiae, and the vision to convert it into viable business outcomes.
"What do you do when you get super analytics people? You still actually need a person with the leadership skills to help them understand how to commercialise that data into something pragmatic that CEOs can actually use," she said.
Does data drive innovation – or do people drive innovation?
Technology and innovation are not horses and carriages – one does not necessarily follow the other. We now have tech at our disposal that lets us glean insights about every site visitor, every social mention, every product interaction and every press article connected with our brand – but are we using this technology to innovate, or are we simply using it to naval gaze? Are we letting machines do the work that the human mind should be doing?
Director and Principal at Watermark Intellectual Property Karen Sinclair summed this conundrum up neatly when she said, "The revolution has been in our ability to crunch data...but it's all rearward looking not forward looking...this ability to crunch data and to predict based on a rearward view of what is going to happen looks a lot like the replacement of the human brain to us – and that's terrifying, and it makes people fear innovation...but the point is that it's not actually innovation, it's analysis. We have to be smart about what the next paradigm is beyond the number crunching, because that's (where the) innovation happens."
Executive Director at the Victorian Chamber of Commerce Dianne Smith recalled an example of data being the glue that helped reshape a long-held public policy in a way that simply wouldn't have been possible without this human element. By bringing together a team of experts from industry and academia and combining their expertise, they were able to apply a meaningful story to a set of numbers and use it to change public health policy.
"It's about collaboration. I worked for National Parks for 10 years and it wasn't until we got Deakin to do some data gathering about the whole public health debate which led to (the creation of) Healthy Parks Victoria. Beforehand it was all about conservation and recreation, but now the debate is (about) funding parks to reduce public health costs – there's a direct correlation. It wasn't until the data came into it that it was a really powerful argument."
Innovation for its own sake doesn't necessarily work unless we engage the hearts and the minds of stakeholders. Or, put another way, a thought bubble is not a strategy. Before embarking on any new innovation program it's necessary to first understand what your purpose is as an organisation and which business decisions you are seeking to answer.
"Technically, innovation shouldn't commence until insights have been extrapolated." – Tiziana Pittui, MP&G
An important part of driving innovation is empowering ideas with lived experience. SRB Director Brian Renwick put it succinctly, "you turn the data into information, and then you dig into the experience and knowledge that's in your brain and use that to drive insight."
The rise and rise of AI
"Nobody wants to be told they've got cancer by a robot," said Damien Ross, Director Executive Engagement at Davidson Technology. His point was that although reliance on Artificial Intelligence is on the rise in health care and surgical procedures, some things are just not suited to being outsourced.
CEO of Kidney Health Australia Mikaela Stafrace is at the coalface of this reality and has witnessed the dissonance that can occur between technology and people. "What we cannot lose sight of is the impact (of technology) on people...we are in an age of gross uncertainty...we all remember the days when you went to school, worked hard, got a trade or went to university – there was a pathway. That's all gone. Most of us are in our fourth or fifth iteration of a career...financial certainty, career certainty, political certainty, are now fractured. It's no coincidence that mental health distress and social dislocation have never been higher."
A clear example of this is the high rate of job redundancies that are a result of efficiencies achieved through technology-driven innovation. Car manufacturing is one of many industries which have seen big advances in automation lead to a commensurate decrease in the number of workers needed to sustain the business.
"Nobody wants to be told they've got cancer by a robot." – Damien Ross, Davidson Technology
From Tiziana's perspective, “many people are struggling to adapt fast enough to keep up with innovations that are supposed to make their lives easier”. It's a fair point, but the ground may be shifting. Organisations undergoing technology transformations are starting to ask, 'how can we retrain people who are keen to learn new skills and are committed to the company', instead of 'how can we off load these people who no longer fit into our skills matrix'.
We need to watch this space, but it could be that we are witnessing the beginnings of a new people-centric innovation dividend. If we work at it, maybe we will beat the machines after all.
End of part one. Keep an eye out for part two of this fascinating story as we unpick innovation as a business imperative, the topic of SRB's CEO Forum held in Melbourne in November 2017.
About the author: Teri Cooper is a writer, marketer and digital communications specialist who writes about technology, business strategy and leadership. She founded digital consultancy Scoot Communications in 2014. When she's not hunched over a keyboard, she can often be found roaming around Melbourne indulging in her two current passions, Instagram and coffee.