Incremental Wins Result in Big Change with Micro Innovation
Media coverage of the rapid strides made in digital transformation by some companies, often spurred on by pandemic pressure, have resulted in many technology leaders coming under board pressure for their own ‘Big Bang’ initiative. But in many instances, using micro innovation as part of your transformation strategy is not only lower risk, but results in better outcomes.
The concept of micro innovation is not new. The term has gained traction since 2010 when Google’s former vice president, Kai-Fu Lee, used it to describe how Chinese companies were improving on western inventions. They were making small changes through multiple iterations until they had a product which was, in many instances superior, but always better suited to their markets and unique user needs.
In the current context of rapid advancement, micro innovations could be just what is needed for companies and tech leaders who are hesitant about taking the first step. Or who are wary of sweeping change in an environment where disruption and big capital outlays must be kept to a minimum.
Incremental Changes Deliver Big Results
Unlike micro innovation, macro innovation often occurs in smaller companies - especially start-ups - where they adopt higher-risk, radically different approaches to innovation. These big new ideas often fail quickly before they are tossed aside and development teams move onto the next innovation.
A great example of macro innovation in a larger company was how Steve Jobs came up with the iPod. A grand idea, that was engineered at a huge scale by a then relatively small company and, fortunately for shareholders, went on to change the way the world consumed music.
However, this kind of success is often the exception rather than the rule and is seldom appropriate, (or supported), in larger organizations which have longer decision-making processes, are generally less developmentally agile, and which often have customers who depend on the products and services already on offer.
The incremental successes of micro innovations are perfectly suited to companies which are less agile and are more focused on sustainable development. For companies operating in the more traditional sectors such as insurance and banking, leaning into incremental changes will offer positive results with clear wins along the way that benefit both company and customer.
Small Wins Keep Everyone Happy
The last year-and-a-half has been filled with stories of companies that have completely revolutionized their operations, either through a business pivot or through a digital re-invention. But for most organizations this is simply not appropriate.
Many organizations, especially those in financial services, are still hamstrung by legacy systems. For sectors like insurance, using micro innovation in these types of environments is perfect. Micro innovation lays the foundation for future changes, but small successes play a major role in winning over internal teams and even skeptical board members.
By focusing on one aspect of the customer journey and automating it, this can have material benefits. For example, when companies turn to automating their claims process, they will see immediate benefits without having to make significant changes to their core systems. The benefits will be felt by both customers and the organization itself. Research done by McKinsey shows that with digital claims transformation, insurers could expect a 20% increase in customer satisfaction and a reduction in claims expenses of between 25 and 30%.
Embrace a Stepwise Approach
The word ‘transformation’ speaks to a meaningful result, a marked change in form, nature, or appearance. But in no definition is transformation described within a time frame. Synatic believes that taking a stepwise approach will allow organizations to benefit from both the results and the process.
The following is Synatic’s five-step approach that lays the foundation for micro innovation delivery:
Define broad goals at the start - Ensure you have management and IT consensus on what aspect of the business you want to transform. Identify how this will impact the rest of the business and how it will fit in with the broader vision of the transformation strategy.
Prioritize based on hierarchy of needs - Once you have identified what needs to be done, create a list of burning issues so you can prioritize what needs to be addressed first. Micro innovation is all about incremental changes through measurable, small wins.
Take a moment to check - Allowing your team time to get to grips with new systems before you move onto the next phase will ensure a smooth transition and keep broader disruptions to a minimum.
Evaluate your handiwork - The beauty of micro innovation is that it is a measurable journey. Critical evaluation of changes means you have the opportunity to fix any small issues and record ways to improve on the process as you go. Not only does this de-risk the process, but it ultimately enables a better long-term outcome.
Rinse and repeat - Before moving onto the next project take some time to check in on the goals you set in step one. Even though tackling big goals through smaller projects minimizes the chance of failure, losing sight of the big picture can find you and your team chasing their tails with projects that don’t contribute to long-term success.
Working with clients using this stepwise approach has yielded tremendous success with minimal disruption. Smaller, more manageable projects that are well planned and communicated with all stakeholders ensures organizational support and significantly increases the chance of achieving the overall transformational vision. It also takes into account that digital transformation is a continuous process. Synatic’s stepwise approach and nimble, simple, powerful platform will ensure you stay ahead of the innovation curve through a constant state of evolution. Getting the right data, to the right person, at the right time.