Innovation is one of the most popular words being used in businesses today. As Alex Triantis, dean of the University of Maryland's Smith School of Business, remarked during his keynote at the school's recent annual summit, "Innovation is an essential building block for prosperity and survival."
While he pointed out the importance of innovation for a company's future, he also noted that turning new ideas into financial success is not easy. There are many impediments, such as corporate strategy, culture, organizational processes and misaligned incentives.
Indeed, John Kotter, a professor at Harvard Business School and well-known author on change, notes that at least 70 percent of new efforts fail.
So how can you improve the odds your innovation will be a success?
Have a clear role for senior leaders
For anything to be truly successful in a company, there must be top management support. Being able to get buy-in from the board and senior management is vital for the successful creation and delivery of innovative products and services. A recent Fortune magazine article on the "World's 50 Greatest Leaders" pointed to how Alan Mulally, as the chief executive of Ford Motor Co., saved the automaker by changing its "risk-averse, reality-denying, CYA-based culture."
Similarly, retired Army Gen. George W. Casey Jr. noted that leaders have to be able to "see around corners" and see something significant about the future that others don't see. This is critical as environments are increasingly described as volatile, uncertain, complex and ambiguous.
Joe Taylor, chief executive of Panasonic, describes innovation as being able to adapt to the markets needs and demands. The market has changed profoundly from the industrial revolution to now. "How quickly can you can adapt?" is how he defines innovation. Top leaders have to be champions of innovation by what they say and what they do.
Take risks and allow for failure
Innovation only happens in the right culture, one where everyone is encouraged to speak up and bring new ideas to the table. While this sounds like common sense, few companies can say that they routinely do this.
Companies also have to take some risks in order to innovate and to succeed. Employees have to see the need for change -- either to move the business forward or to help it avoid being left behind. Further, they have to understand that some failures will be likely to occur and that it will be OK. The idea is not to encourage failure, but to foster innovation that leads to winning success as rapidly as possible.
Companies may want to have large, breakthrough innovations, but they can still focus on innovating in smaller, shorter bursts. They can look for improvements to current products and services and use smaller experiments to test new ideas. By starting smaller, they may have an easier time getting employees on board and convincing external clients of what they are doing. These smaller innovations can also serve as the building blocks for later larger innovations.
Integrate innovation throughout the firm
Innovation can't be solely placed in one department with an Innovation Czar. It might be better to weave it into the fabric of the entire organization so that everyone is concerned and advocating for the new initiatives in their work. Otherwise, it is seen as one department's work (to make the firm more innovative), and with this approach, the firm is likely to fail.
As management guru Peter Drucker noted: "Innovation is the specific tool of entrepreneurs, the means by which they exploit change as an opportunity for a different business or a different service. It is capable of being presented as a discipline, capable of being learned, capable of being practiced. Entrepreneurs need to search purposefully for the sources of innovation, the changes and their symptoms that indicate opportunities for successful innovation. And they need to know and to apply the principles of successful innovation."
• Russell is the vice dean and the director of the Executive Coaching and Leadership Development Program at the University of Maryland's Robert H. Smith School of Business. She is a licensed industrial and organizational psychologist and has more than 25 years of experience coaching executives and consulting on leadership and career management.