There's a fine line between innovation that's useful and innovation that's a trendy novelty. A well-defined line could reduce operational risks and supply chain challenges.
As one PwC report points out, innovation is moving from something created in a lab towards something that creates value for customers. Said another way, as written here, innovation is “something different that has impact.”
Generally, over the last decade or two, the electronics supply chain has taken a number of steps that by those definitions fall into the innovation category. New software tools, along with better internal and cross-enterprise practices, have improved forecast and inventory visibility, product delivery, manufacturing process, and new product design — all of which have created value and impact.
But, where do we go from here?
While I've heard some great new ideas about the supply chain (like using the cloud to get closer to more real-time supply chain management), I don't know if that's necessarily innovative.
There is a fine line between innovation and novelty. Something that's new isn't necessarily innovative, and something that's innovative isn't always new. And, whether a new idea is innovative or simply novel, companies will assume some amount of risk by implementing it. The issue comes in distinguishing which risks to take and how much to risk.
PwC suggests that companies follow some of these steps as a way to draw a line in the sand and separate out innovation from novelty. Though not supply chain-specific, they certainly apply and are probably already implemented to some degree among thought leaders.
- Become systematic about innovation. Companies considered to be the most effective innovators have developed structures that allow employees to think like entrepreneurs, empowering them to think about problem-solutions scenarios that address their everyday concerns. Also, they have strong leadership that provides centralized support.
- Think about the long haul. To vet out innovative ideas from novel ones, and to have a continuous stream of innovative ideas to pull from, innovative companies establish a pipeline where both incremental ideas and long-term big bets are frequently percolating.
- Embrace digital. PwC notes the many forms of innovation have resulted from the digitalization of operational models. The firm suggests companies define what more complete digitalization could mean for the business and examine whether the company is taking full advantage of existing digital tools.
At the end of the day, though, innovation doesn't happen in some back room somewhere. For companies and supply chain professionals, innovation that adds value and makes an impact involves getting closer to your suppliers and rolling up your sleeves to more fully understand the pain points. Until that happens, the industry could be looking at a lot of new ideas that may or may not have a lasting affect.
So, tell me, what innovative idea do you think will move the supply chain further?