Breaking Down the Barriers to Operational Innovation

Business leaders often seek to drive innovation to carve out a competitive advantage in the market, but innovation doesn’t have to mean disrupting or reshaping an entire industry. Such seismic shifts often come around only once in a generation.

Operational innovation is much more achievable and has the potential to drive greater return than many other investments as it enables organizations to move faster, create more value and build competitive advantage.

However, operational innovation is not always easy. Organizational silos, unhappy employees and time constraints loom large, but with the right strategy, business culture and use of technology, progress is possible.

Three Ways Businesses Are Being Held Back

Operational innovation is about streamlining processes, workflows and tools to help teams get the most value out of every activity. The complexity that digital transformation initiatives bring makes this increasingly challenging, especially due to the tech debt created by legacy systems and the proliferation of data and team silos. This is all in addition to the growing demands and expectations of customers.

The emergence of AI and automation creates a fantastic opportunity to streamline business activities and harness operational intelligence to improve agility. These technology advancements present new opportunities to drive sustainable growth, support a more agile workforce and build resilience to outside pressures and threats.

Companies such as Walmart and Toyota rose to dominate their respective industries by mastering operational innovation. For modern organizations striving to achieve similar success, there are three key barriers to overcome:

1. Siloed Technical and Business Teams

If tech and business teams focus myopically on their own goals and strategies, the organization risks wasting time and money by duplicating efforts and toolsets. When teams are unable to align on shared requirements and objectives, they miss a golden opportunity to consolidate workflows to reduce inefficiencies, and lack the motivation to strive for shared companywide innovation goals.

Communication and collaboration are key to ensuring alignment throughout an organization and are highly effective when promoted by senior leaders. Teams can work in cross-functional groups to align on common goals and encourage a shared sense of purpose.

IT leaders can support this process by taking the time to understand the goals and pain points of their business counterparts and by acting as trusted technical advisors to them. By placing a strong focus on this process, IT leaders can close the knowledge gap that often exists between technical and business-focused teams, which can help both groups work together to meet the organization’s goals.

2. Human-Shaped Challenges

In many cases, the success of operational innovation depends on the changes employees are willing to make. However, humans are creatures of habit and often resist change, even when this means taking longer to complete laborious manual tasks.

With this in mind, organizations should assume that the adoption of new technologies, workflows and processes will require due consideration of the human factor. As ever, any major change in an organization is a question of people, processes and technology.

Change should never be for its own sake, and organizations must take the time to explain to employees why changes are being implemented — including the benefits that they will provide, both internally and externally. It pays to be level-headed here. Don’t overplay the long-term benefits of a specific change, and appreciate that it may take time for it to start showing results.

Try engaging employees in the process of innovation by making formal requests for feedback on plans and new ideas. The idea is to create a culture of risk-taking and ownership, but in a place of psychological safety where team members know they won’t be blamed if an initiative doesn’t work out as planned. The shared sense of ownership this will build can help to reduce resistance to change and drive more innovation from risk-taking.

3. Time Constraints

There are never enough hours in the day for operational teams. That’s especially true in a world where many still toil with repetitive manual processes, endless meetings and competing priorities. When these activities take up the majority of the working day, what time is there left to innovate?

Freeing up that time might mean scrutinizing what is truly needed. A great way to hand bandwidth back to team members is through judicious use of AI and automation to take over repetitive manual tasks to reduce toil on teams. For example, a service desk employee may no longer have to manually run diagnostics to gather information related to an issue, but instead could have the relevant context delivered to them automatically.

This process of rethinking the nature of work — and shifting people away from tedious work — can drive huge innovations. Even now, many organizations are reimagining when, where and how work is done. These organizations are freeing up employees to focus on higher-value work, and placing a greater emphasis on the business impact of the work their teams do.

The Road to Strategic Advantage

Operational innovation holds the key to driving faster speed to market, enhanced business resilience and higher levels of productivity. But the right pieces must be put in place to give initiatives the best chance of success. Organizations that prosper treat this as just one part of an overall innovation strategy. They have a culture of openness, cross-functional collaboration, experimentation and two-way feedback with employees. They promote psychological safety and reward innovative ideas, and they’re constantly thinking of new ways to reimagine the way work is done.

Successful organizations also spend time to ensure they have the right foundations in place. This means responsible data management and governance practices, including data literacy training for employees. It also means having the right AI and automation tools to optimize workflows, reduce technical debt and give employees more bandwidth. This is where having the right technology and business partners comes in — helping clients optimize their in-house resources, while introducing new tools and ideas to drive operational innovation forward.

The road to competitive advantage starts here.