How to use innovation to drive efficiency and growth

Innovation: a term that carries so much promise. Greater revenues, massive savings, pioneering new products and the possibility to open up new markets. And yet it also comes with uncertainty: as with any R&D, there’s no sure-fire way of guaranteeing success. This is why so many innovation programmes get side-lined, in favour of more traditional efficiency drives. Even though the rewards may not be as great, these conventional cost-saving projects tend to offer a higher level of certainty when it comes to their outcomes.

With budgets being squeezed amidst an uncertain economic outlook, this stance is understandable. But what increasing numbers of organisations are realising, is that correctly targeted innovation initiatives can achieve more than one goal.

Firstly, they can help deliver the necessary efficiencies – and potentially achieve greater savings than a traditional efficiency drive. Secondly, the innovation programme can unlock much-higher-value benefits, such as new products and services, new revenue streams and more as mentioned above.

It genuinely is the best of both worlds. Sound too good to be true? Let’s look at a couple of examples to illustrate what’s possible.

Multi-purpose innovation

Take application modernisation and management. Most organisations have legacy IT systems that are expensive to maintain and inflexible when it comes to developing new products or services. By moving these apps to a modern, more innovative technology base that’s easier to support, the organisation achieves the efficiencies it wants by driving down management costs. These savings can be amplified by harnessing innovative predictive maintenance techniques that proactively identify and address problems before they impact the organisation or its customers. This helps avoid costs associated with poor performance or downtime. Importantly, as well as delivering these efficiencies, the new technology platform provides the foundations for rapid innovation in product and service development.

Workplace productivity improvement initiatives can also benefit from innovative technologies, such as the use of robotic process automation. Using this and other techniques we have been able to help our customers save money and free up skilled human resources to focus on higher-value work, the outcomes of this efficiency-focused innovation can be rolled out in other places, including customer-facing systems. In the area of data sift, the use of artificial intelligence can be particularly effective, only showing items of interest to a human operator; allowing huge productivity gains.

Analytics is another area where innovation can really drive business efficiency. By creating a pioneering, business-wide analytics platform, and taking advantage of techniques such as deep learning, predictive analytics and natural language processing, organisations can create transformational views of their customers, citizens or patients. From an efficiency perspective, this will enable faster and better-informed decision-making. Meanwhile, the insights from the data can provide greater value by enabling the organisation to identify exciting new opportunities for growth – or further savings.

Partnering for success

These examples highlight how innovation can help achieve cost savings and other efficiencies, while simultaneously providing the keys to unlock the higher rewards every organisation wants. But how should organisations go about delivering successful multi-track innovation programmes? How can they minimise their exposure to risk, while maximising the potential rewards? With organisations lacking the right skills, resource and even knowledge internally, taking advantage of these new technologies is not an easy path to conquer.

The first thing to look for is a partner that’s open to sharing the risk of innovation. This could be through an existing investment they’ve made in a relevant area of R&D, or through a shared-risk, shared-reward commercial model.

Together, set a strategy that defines where you want to get to as an organisation – both in terms of efficiency savings and the higher-value rewards. This needs to look at how your organisation may need to change structurally and culturally, as well as technologically.

It’s best if your innovation partner is capable of coming with you on the journey. As well as helping you define the strategy, the partner should be able to implement it. This includes the delivery of any organisational changes and technology projects. This gives you the simplicity of working with one organisation throughout, and ensures the strategic direction you set out at the start is genuinely achievable – because the partner will have something riding on it.

Real results

The outcomes can be truly transformational. We’ve been working with a number of utility customers recently, putting our own resources and effort into R&D in smart connected services. This uses the power of the IoT, AI and machine learning to deliver some amazing results. One of our customers has achieved over £3.8m of savings through business efficiency initiatives enabled by our digital service solution.  Simultaneously, the actionable insights have opened up additional revenue opportunities of over £1m for the same customer.

In this way, a joint commitment to innovation between us and our customers is both driving efficiency savings and helping unleash high-reward benefits.

Where could a well-targeted innovation programme take your organisation?

This article was originally published here.