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Innovation&: Innovation strategy and innovation portfolio

Checkpoint Innovation

Image: Every innovation project has a learning, validation, or business goal and receives resources accordingly in the form of a runway. On the checkpoint day, decisions are made about whether and how to proceed with the project and what the next goal is.

Maintain a diversified portfolio

In today's business world, it is crucial to develop a clear innovation strategy to stay competitive and also manage budgets smartly. One of the proven tools for implementing this strategy is the innovation portfolio based on the Horizon model.

The Horizon model is a proven method to categorize innovation projects into different horizons or categories. Horizon 1 includes projects aimed at generating short-term profits, Horizon 2 comprises medium-term projects with growth potential, and Horizon 3 involves long-term, risky projects targeting future opportunities. A diversified innovation portfolio that covers all horizons allows a company to focus on short and long-term goals while spreading risks.

Resource allocation

Effective resource allocation is crucial for the success of an innovation strategy. Various resources are required for each innovation project, including qualified personnel, specialized expertise, budget, and time.

It is important to involve the right individuals in the projects who possess the necessary expertise. Similarly, the budget must be carefully managed to ensure that financial resources are used efficiently in the context of a runway. Time is a limited resource, so it should be invested wisely to achieve project goals.

Implement a metric of measurement

To track the progress and success of innovation projects, the implementation of metrics of measurement is essential. There are different types of metrics, including validation goals, learning goals, and other business metrics.

Validation goals are used to determine early on whether a project is feasible. Learning goals help expand knowledge and skills throughout the project. Business metrics measure actual business success, such as revenue growth, cost savings, or market penetration.

Set outcome checkpoints and decide whether and how to proceed

Throughout the entire lifecycle of an innovation project, outcome checkpoints are crucial to ensure that the project is on the right track. There are various phases that should be reviewed, including user analysis, problem analysis, problem-solution fit, product-market fit, and business model fit.

In the user analysis, the target audience is identified, and their needs and preferences are analyzed. The problem analysis aims to clearly understand the challenges and opportunities. The problem-solution fit determines whether the proposed solution effectively addresses the problem and provides added value compared to doing nothing or using alternatives. The product-market fit confirms that the product or service is in demand in the market. Finally, the business model fit ensures that the business model is sustainable and has the potential for growth.

Conclusion - Innovation strategy and innovation portfolio

Developing a successful innovation strategy requires a thoughtful approach. A diversified innovation portfolio, effective resource allocation, clear measurement metrics, and regular checkpoints are crucial to ensure that innovation projects achieve the desired results. By implementing these steps, a company can enhance its competitiveness and succeed in the long run. Innovation strategy and innovation portfolio are the keys to the future.


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