**3.1. Performance cycle and innovation cycle**

Most leadership teams are alive to the challenge of delivering for today while conceiving innovations for tomorrow. They are well aware that they need to address the questions of:


They recognize that while the first question is always more pressing, some thought and effort need to be simultaneously dedicated to the second question.

Most established organizations are centered around the "performance cycle" (**Figure 1**). The performance cycle is what creates value for today. It is where core capabilities and processes reside, with focus on consistency, repeatability, targets, control, and strong governance. If the performance cycle is malfunctioning, resource will be drawn from elsewhere, sometimes sacrificing innovation.

For listed companies that need to report quarterly, leadership can become preoccupied with "feeding the monster," fueling, tweaking, and fettling the performance cycle to deliver ever more. The performance cycle attracts the lion's share of talent, resource, and political influence.

There is a separate requirement to ponder the future, to provide stimulation and inspiration, and to understand where future value growth is going to come from. Let us call this the innovation cycle (**Figure 2**). The innovation cycle takes into account trends in technology,

**Figure 2.** Innovation Cycle.

proposition was highly appealing to customers, particularly in countries with less well-devel-

This convergence of financial protection with healthcare management might be an exciting and potentially valuable customer proposition, but how do you go about delivering it when your main competence is in actuarial science and product distribution through an agency

Insurance and healthcare are different sectors that are regulated separately and based on different capabilities. Therefore, it is tempting to respond to such questions with a start point of" we are in the business of insurance, not healthcare" and to preclude the option of organic

One could have made the same argument about automotive manufacture and distribution compared to vehicle finance and insurance. Yet, over the past 20–30 years, the major automotive brands have successfully evolved their organizations to include sizeable core banking

There has been a trend toward more "open-source" innovation, encouraging participation from beyond the organization in order to access expertise that the company does not have and would struggle to develop organically. Notable players in this space include Unilever

While large organizations have found new ways to generate innovative ideas, bringing them to fruition through the established organization remains a challenge. The focus of this paper is not on the identification of valuable innovation opportunities (innovation outside), but more

Most leadership teams are alive to the challenge of delivering for today while conceiving innovations for tomorrow. They are well aware that they need to address the questions of:

**1.** How can we improve what we do to drive **performance** in the short term? (focus on get-

**2.** Where and how should we be **innovating** in the future to sustain value growth? (focus on

They recognize that while the first question is always more pressing, some thought and effort

(Unilever Ventures and Unilever Foundry) and Coca-Cola (VEB) (see Section 3.2.6).

on the challenges related to their realization and delivery (innovation inside).

**3. Exploring current approaches to innovation**

need to be simultaneously dedicated to the second question.

**3.1. Performance cycle and innovation cycle**

ting **BETTER**)

being **DIFFERENT**)

model? For what healthcare and wellness services would you be a credible provider?

organization development in favor of partnerships and alliances.

oped healthcare infrastructure and availability.

**2.3. Emerging approaches to innovation**

operations.

6 Marketing

competitor activity, regulatory change, and social/cultural influences. Most importantly, the innovation cycle explores how customers' needs are changing and their "jobs to be done."

priorities, they struggle to dedicate even 20%. Innovation becomes consigned to the "important, but not urgent" quadrant of the organization's priorities. The innovation manager is more of a cheerleader than an impactful practitioner and will always default to operational

Innovation Inside

9

http://dx.doi.org/10.5772/intechopen.74090

In many ways, side-of-desk innovation represents the worst of all worlds. Some resource is dedicated to it, and there is some level of expectation that "somebody is looking after it, so I don't have to." But under this setup, innovation is poorly handled, delivers little, and is vis-

In a fast-moving industry, the organization recognizes that it needs external help to stay up to speed with what is happening in the world outside. Disruptive thinking is outsourced to an expensive innovation agency that is fantastic at idea generation and beard cultivation—but

While they may be steeped in the language of design thinking and agile project management, they know little of the realities of business and what it takes to cross the bridge from idea to

Recently, technology and business process outsourcing consultants have been acquiring innovation agencies in the hope of owning the entire customer experience, leveraging digital technologies and getting into space that has traditionally been the domain of the large advertising

Under the semidetached model (**Figure 3**), there is an explicit recognition that innovation is different from operations, needs proper resourcing, and should be a discrete unit. There is a team in a purpose-built location (often on the main business site) that enjoys the benefits of

groups. We are skeptical of treating core innovation as an outsourced service.

corporate resources but is not subject to the usual rigors of corporate governance.

matters when under pressure.

*3.2.4. Agency innovation*

delivery.

would struggle to boil an egg.

*3.2.5. Semidetached innovation*

**Figure 3.** Semidetached innovation.

ibly a low priority. Perhaps better not to bother at all.

All these inputs are then the fodder for generation of ideas for new customer propositions which are then developed, filtered, and tested. The output from the innovation cycle will vary from an articulation of high-level opportunity areas through to headline business plans and implementation pathways.
