MIT Sloan Management Review Article on Effective Innovation Begins With Strategic Direction

When speaking with global executives, we often ask them, “What’s one thing your company needs to improve?” Their word choice varies by region, but their response is usually the same: the ability to derive more value from their companies’ investments in innovation.

More often than not, the underlying problem is that innovation is assumed to be an end in itself rather than the mechanism for achieving a specific form of change. The impetus to innovate is independent from a strategic analysis of where and how innovation can improve the organization’s fit to purpose, or the quality of fit with the expectations of customers and other stakeholders; and its relative advantage, or its distinctiveness relative to alternatives. But most innovation advice given to leaders lacks the context necessary to guide their actions.