Selecting an Innovation StrategyNew Perspective
Selecting an Innovation Strategy
by Paul Plsek, MS, Paul E. Plsek & Associates, Inc.; Former Member, Innovations Exchange Editorial Board
|By Paul E. Plsek, MS, Paul E. Plsek & Associates, Inc.; Author, Accelerating Health Care Transformation with Lean and Innovation: The Virginia Mason Experience; Former Member, Innovations Exchange Editorial Board|
Innovation offers many potential benefits to heath care organizations, including improvements in the patient care experience, better health outcomes, increased market share, reductions in costs, and improved ability to attract and retain highly qualified staff. Given the importance of innovation and its potential benefits, an organization should plan the process of innovation in a way that reflects a deliberate strategy. In general, the selection of an innovation strategy should be based on the answers to three key questions:
A health care organization is unlikely to have the time and resources required to be innovative in all areas. When selecting an innovation strategy, it is therefore important to choose focus areas for innovation, selecting from activities such as new models of care delivery, new lines of business, novel revenue sources, partnership arrangements, organizational development, and internal processes and workflows. Although clinical innovations are outside the scope of the Health Care Innovations Exchange, an organization also could pursue innovations in areas such as basic research, treatment protocols, surgical procedures, or medical devices. Options for further refinement of the innovation strategy include focusing on clinical conditions or activities (e.g., cancer care, primary care), patient groups (e.g., elderly patients, executives), or geographic regions (e.g., Florida, the southwestern United States). Here are some examples:
Another important part of selecting an innovation strategy involves deciding whether to be a true innovator or to wait and adopt an innovation after it has been introduced successfully in other settings. In his widely cited book, Diffusion of Innovations1 (first published in 1962), Everett M. Rogers used a bell-shaped curve to illustrate the adoption of innovations, and divided the population of innovators in a given topic area into five groups, using roughly one and two standard deviations above and below the average as category boundaries. The Rogers model therefore suggests that 2.5 percent of the total population of innovation adopters are the true innovators (or “first movers”) who generate new ideas. Early adopters (or “fast followers,” 13.5 percent of the population) are among the first to pick up an innovation and try it themselves. Most people, however, wait to see if the innovation will prove to be useful; these constitute the early majority (or “industry best-practice adopters,” 34 percent) and the late majority (34 percent). Finally, the “laggards” (16 percent) are the last to come on board. When the cumulative number of adopters is plotted over time, the result is a classic “S curve” that represents slow initial adoption of an innovation, followed by a period of rapid spread, then a leveling off as adoption of the innovation approaches the saturation level.
An organization that wants to operate in the early part of the innovation curve can choose to be a first mover, a fast follower, or an industry best-practice adopter, all of which are valid strategies. Each strategy has potential benefits and risks:
The third consideration in selecting an innovation strategy involves deciding how to generate ideas and execute innovative practices. The key question is the extent to which the organization will pursue an innovation as a centralized effort versus a decentralized activity. The possible approaches span a spectrum that runs from innovation that is a separate function directed by a central part of the organization, to innovation that is fully integrated into the daily work of front-line leaders and their staff. Different considerations arise along the spectrum:
An organization seeking to cultivate a culture of innovation should consider all of the options outlined in this article. By choosing preferred focus areas for innovation, deciding where on the innovation curve to concentrate innovation efforts, and developing an internal strategy for nurturing innovation, a health care organization can define an overall innovation strategy that is suitable for achieving the organization’s goals.
About the Author
Mr. Plsek is an internationally recognized consultant on innovation in complex organizations. A former research engineer at Bell Laboratories and director of corporate quality planning at AT&T, he now operates his own consulting practice and is the developer of the concept of DirectedCreativity™. His health care clients have included the National Health Service (NHS) in England, Kaiser Permanente, the Veterans Health Administration, the SSM Health Care System, and the Mayo Clinic. Mr. Plsek is the Chair of Innovation at the Virginia Mason Medical Center (Seattle), an innovator-in-residence at MedStar Health (DC–Baltimore), Director of the NHS Academy for Large-Scale Change (UK), a former senior fellow at the Institute for Healthcare Improvement, an active research investigator, a popular conference speaker, and a former member of the Innovations Exchange Editorial Board. He is the author of dozens of peer-reviewed journal articles and seven books, including Creativity, Innovation and Quality; Edgeware: Insights from Complexity Science for Health Care Leaders; and Accelerating Health Care Transformation with Lean and Innovation: The Virginia Mason Experience.
Disclosure Statement: Mr. Plsek is an independent management consultant who advises health care organizations on innovation strategy.
Last updated: December 04, 2013.