Promoting Innovation: Moving into the Digital Future

Almost every company is undergoing digital transformation these days. Whether they provide goods or services, supply, sell, or take care of disposal — the availability of digital products and technologies is fundamentally changing the traditional way of 
doing business. This is true of production and sales, but also when it comes to the product itself. One example is music, where streaming has made classical recording media obsolete. For all these companies, the ability to remake themselves — that is, to innovate — is a massive challenge. And in many cases, the organization’s future depends on it. So what a challenge it must be for the companies that actually initiate this transformation — the IT service providers and product developers. In extreme cases, what they themselves do to create value is what initiates yet another transformation of the value creation processes. This is an ongoing process that doesn’t allow for any downtime.

Successful IT companies respond to this challenge by consistently focusing on expansion and on maintaining their most impor-tant resource and key means of production ­— current knowledge of how digital technol­o­gies work and the potential they offer. This combination of “being up-to-date,” “function,” and “potential” is a very specific type of knowledge that isn’t always easy to define. This knowledge is both academic and empir­ical; it comprises technical basics as well as a knowledge of applications. And its half-life fluctuates somewhere between “hype” and “eternity.” This means that the methods for embedding this knowledge in a company are not linear or obvious, either — they are actually a complex (and fragile) combination of culture, methods, and information that allows this knowledge to grow.

Every person has an inbuilt urge to try things out and learn new concepts. Their attempts are not always successful. All too often you can “get your fingers burned” in the process. But this is an important part, and cannot and should not be prevented. Innovative companies use this effect by establishing a culture that is open to errors. This type of culture encourages employees to take risks and contribute new ideas. And it avoids disruptive factors like rigid hierarchies and restrictive processes. Interactions are all about respect, trust, and confidence. This nurtures the intrinsic urge mentioned above and acts as a “motor” for all other activities aimed at creating knowledge.

Knowledge needs free space to develop and become established. Agile methods use this free space to deal with constantly changing requirements. This makes them the natural choice for innovative working. Setting up innovation labs or incubators within the company also offers space for creative ideas and experiments. These special working environments allow employees to pursue innovative projects, explore new technologies, and develop prototypes. By creating a structure for innovation, companies can minimize the risk of failure while boosting the potential for groundbreaking developments. The ti&m garage, an innovation incubator, is one great example of this approach.

Knowledge is one of the few raw materials that increases when you share it. Innovative companies introduce mechanisms that encourage an exchange of knowledge and ideas between teams and disciplines. Implementing knowledge databases is a good way to achieve this. So are regular internal training, hackathons, and innovation workshops. Encouraging collaboration between developers, designers, and subject experts leads to creative solutions and new product ideas. But this exchange need not be only within the company. An open exchange with universities, manufacturers, and even competitors can allow a company to benefit from their specialist knowledge and ideas. They can also gain access to new technologies, markets, and innovative business models.

If a successful company has created a culture and environment where the latest insights can grow and evolve, the step from “knowledge” to “innovation” is just a small one. Once this is in place, often just a tiny spark — such as an article in a magazine 
or maybe just a sentence in a discussion — is all it takes to generate real innova­tions based on this knowledge. Oftentimes, this spark then catches on everywhere — in a product’s design, in the plan for the user interface, and even in the technical
implementation. And this is what creates the product that we digitalization pros ultimately promise our customers: innovation.