“Innovation is one of the main buzz words in business today with 80 percent of CEOs saying it’s the most important thing for their business, but only 10 percent say they are any good at it.” John Coyle, Maddock Douglas

This glaring paradox was reported in a recent webinar by John Coyle, senior vice president of Innovation at Maddock Douglas, a well-known innovation consulting firm. Backed by extensive direct experience with company clients in industries throughout world, Maddock Douglas has isolated common hurdles and pitfalls that predominantly account for this cavern between the stated innovation priority and tangible outcomes. “Through these past 15 years, we have seen some repeatable obstacles that keep occurring as large- and medium-sized companies try to innovate,” Coyle said.

By sharing how these obstacles emerge, what they look like and what you can do about them, “you can pre-empt them as you tackle your innovation strategy,” he says.

Here are three main obstacles, one key pitfall and what you can do about them:

Obstacle 1: No support, no budget, no power. An implicit agreement that “innovation” is important, or a “company value” is not enough. You need explicit governance in place.

Solution: People support that which they create. Involve people actively. Build consensus and defined agreements on roles, goals, size, budget and governance for innovation. This starts at the top of the organization. Advice at this stage is to ask for what you need, not what you think you can get.

Obstacle 2: Guys and gals in ties. Understand that there are forces in your firm (finance, accounting, compliance, legal, operations, etc.) that are held accountable to create safeguards and reduce risk, not take on more. These important functions are “specifically set up to decrease risk, increase efficiency, and deliver things with excellence, high quality, and just by the way, these happen to be things that can be antibodies against innovation … Innovation is antithetical to most of the business processes used today.”

Solution: Rigorous testing and co-creation. Create an incredible case using a rich database of quantitative testing built from your small pilot projects, show them all your testing of insights and concepts and invite them to participate. They are more likely to be supportive, and can be a great asset and top champion, if they are part of the process and along for the ride providing valuable input.

Obstacle 3: Culture eats innovation for breakfast. Service or business model innovations often mean people’s jobs may have to change and that may set up resistance. Also members of innovation effort still have their “day jobs.” They get busy and the tyranny of the urgent takes over and nothing happens. This is the most common obstacle to innovation--culture coming out and finding ways to delay, quash, or kill the effort.

Solution: Don’t declare innovation. Build an innovation culture by training leaders on innovation skills, do regular communications on successes (and failures), and involve all levels. Making this investment to innovation skills and building infrastructure and process tangibly demonstrates the importance of innovation activity and to take on some intelligent risks. A great metaphor was given that if you look at your ideas as your seeds, your culture is the soil. If you do not prepare your culture, your ideas may never take root.

Pitfall: Great new innovations are often lost in translation. John stated that he has painfully witnessed time and time again when the best innovations coming from a deep insight off of a latent or emerging customer need, mathematically proven, culturally driven, leadership supported, vetted by all, may still fail because it was handed off to another group from the ones who created it (like an outside marketing agency or internal implementation group) and then they cannot articulate the innovation well; not even close to the core insight that drove it. “It doesn’t matter how cool, awesome, or great it is because no one will understand it … It is not articulated in a way that consumers can understand.” It can be a deadly handoff going from concept to implementation if you are not diligent.

Solution: Assign an “idea parent.” Someone from the original idea team must be assigned to nurture the insight through the implementation and advertising process to insure the core consumer insights are not lost along the way.

These are valuable perspectives for firms of all sizes, in any industry, as innovation runs into familiar obstacles for all. Smaller firms can learn, borrow and apply innovation best practices and lessons learned from larger firms to promote more innovation in their businesses.

The Institute for Innovation Development is an educational and business development catalyst for growth-oriented financial advisors and financial services firms. We position our members with the necessary ongoing innovation resources and best practices to drive and facilitate their growth, differentiation and unique community engagement strategies. The institute was launched with the support and foresight of our founding sponsors--Pershing, Voya Financial, Ultimus Fund Solutions, Fidelity, MeridianIQ/AdviceIQ, Innovation Equity Partners and Charter Financial Publishing (publisher of Financial Advisor and Private Wealth magazines). For more information click here.