Five Tips for Innovation in the Digital Age
“Digitalization doesn’t just fall from the sky” says Prof. Dr. Peter G. Kirchschläger, Professor of Ethics and Lecturer at the University of Rochester-Bern. Managers and employees are responsible for the digital transformation of their companies; they shape it and make decisions about it. Digitalization can only succeed if they contribute innovative ideas.
Self-checkout in retail didn’t just appear out of nowhere – it was the result of an idea that was developed and implemented. The same is true of mobile banking apps and AI’s use in cancer detection. People drive innovation in digital transformation. The following tips can help to promote innovation in your company:
Culture before strategy before technology
“Culture eats strategy for breakfast and technology for lunch.” This quote from Peter Drucker was further developed by MIT professor Bill Aulet. Without the right culture, neither brilliant plans nor the latest technology are useful. Change is only possible if employees are on board. A culture of openness, trust, and risk-taking is essential for a company’s successful digital transformation. At the same time, management – including the board of directors – must ensure active implementation in line with the company’s values.
Competence instead of product thinking
Successful companies focus on their strengths. Rather than asking, “What product should we develop?” they ask, “What business opportunities arise from our core competencies?” This requires companies to understand themselves and their strengths, as well as their position in the market. Only then can they take the next step: evaluating how existing products and/or services can be improved in the context of digitalization or creating new ones.
Prioritization and focus
Many companies face the challenge of lacking focus due to the sheer number of possibilities available to them. There are constant reports of new trends and technologies that could all be pursued. AI can help to systematically analyze market potential. An exciting example is the “Where to Play” platform developed by Marc Gruber, Professor of Innovation and Lecturer at Rochester-Bern, and his team. he tool guides companies through a process that helps them identify and prioritize the best market opportunities. Gruber says, “It is a strategic decision in which field of innovation a company wants to operate.”
Let go of gimmicks
Although introducing new technologies in a playful way can be effective at first, it is important that companies not get lost in this approach. Having a good idea is not enough; many factors are needed to implement a successful innovation. It must be created at the right time and, above all, made accessible to people. “Innovation is invention and commercialization,” says Gruber. Some new innovations, especially in the context of digital transformation, may appear appealing and entertaining, but they lack the potential to be successful in the marketplace. Such ideas should be abandoned early on. Ideally, ROI should be measured regularly so that pointless projects are not pursued.
Don’t forget the risks
According to the Allianz Risk Barometer, cyberattacks will be the greatest business risk in 2025. “New IT applications with internal and external interfaces increase cyber risk,” warns Daniel Isler, Head of Digital Transformation, founder of Fargate, and guest speaker at Rochester-Bern. He advises companies to create a top 10 cyber risk map that ranks the ten most relevant cyber risks according to their probability of occurrence and potential damage. Based on this map, companies can define preventive measures and response strategies in the event of an incident.
Conclusion
Innovation cannot be forced. However, managers can create favorable conditions, establish strategic guidelines, maintain focus, and manage risks.