What an innovation manager does and how your company can benefit from this role?
Every company plays in a highly competitive environment and must constantly prove itself through innovation and progress. To do this, it also needs the right people and talent to take the lead. We believe that every company large and small can benefit from the Innovation Manager role. And we want to share our experience with everyone who has an interest in innovation and this specific role. In the following we will give you an overview of the specifics of the Digital Innovation Manager. And the tasks that are in the responsibility of this role. We also look at what tools are used and what mindset it takes to perform the job well. Of course, we have also included examples and further information from other companies and partners.
The pressing need to explore the new to renew the status-quo
Every company deals with digital transformation more or less intensively. Digital transformation has already been the doom of many companies because they have failed to adapt or have been defeated by their competitors through the clever use of digital technologies.
A classic example is Kodak. Once a world-renowned leader in analogue photography, today, Kodak, by contrast, is insignificant. Younger generations are less familiar with Kodak and they tend to take photos with their smartphones…
The automotive industry is also being completely transformed by technological change. On the one hand, through electromobility and, on the other, through digitization, which makes autonomous driving possible in the first place and changes the entire infotainment and thus the in-car experience radically. This has probably caused quite a headache for leading automotive manufacturers.
Another great example is completely new business models like Uber and Airbnb. Build a digital platform in an established industry and the whole game changes. It is not without reason that more companies than ever are looking for new digital platform business models to stay relevant in those “the winner takes it all” games.
The series of examples can be continued almost endlessly. Especially when we look at the digital technologies that have appeared on the horizon and from which many hopes are pinned, such as quantum computing, or the trend towards Metaverse.
Digital technologies can be used not only for the development of new business models. They are also ideal for optimizing and automating existing processes and reducing costs. However, the question is where which technologies can help and be used, and which technologies are already mature enough? In addition, there are new business trends and major changes in the world of work. Companies must also quickly find sustainable answers to these questions. These are also issues that, in conjunction with new technologies, are overwhelming for many companies. Some simply can no longer keep up. Especially companies in established industries for which digital is not at the core of their business.
Whether new business models or the optimization of the existing business model. The innovative strength of a company is a decisive factor to survive in the market on the long run. Exactly at this point, the question arises as to who will take on the task of successfully advancing the use of digital technologies to stay relevant?
Who is supposed to explore and manage digital innovations?
At the strategic level, this task is often carried out by the Chief Innovation Officer, Chief Technology Officer, or Chief Information Officer. This person defines the innovation vision, strategy and roadmap, which is aligned with the corporate strategy. In some companies, new and innovative IT topics are also assigned to the Chief Digital Officer. However, recent years have shown that a separation between CDO and CIO is not always crowned with success.
But who breaks down the innovation vision and operationalizes the strategy so that in the end tangible results are achieved and real added value is created? Who takes care of the exploration of new technologies and brings them into use?
In short: There is no "one size fits all" answer to this question. And there is no single person who can do it all. At least, we haven't come across one yet.
Throughout the many customer engagements and projects, however, we are constantly dealing with different roles that take on this responsibility. They share the core of their work: to "renew" things through digital technologies. This role can be summarized under the term "Innovation Manager".
In some companies, Innovation Managers are also referred to as Innovation Specialist, Innovation Lead, Innovation Agent, or Innovation Architect. For external Innovation Manager roles, like ours, the term Innovation Consultant is common.
Different roles who act as Innovation Managers
Even though the role of an Innovation Manager most likely looks a little bit different in every company, we have listed some of the most common roles we work with to explore and apply digital technologies.
What roles do we see customers using as Digital Innovation Managers?
- Enterprise Architects (some with focus on Emerging Technologies),
- “Official” Innovation Managers (with focus on specific technologies or Lines of Business),
- Innovation Brokers (with focus on the innovation strategy and the partner ecosystem)
- IT who needs / wants to innovate (e.g., to optimize core business processes),
- Product Owners or Product Managers, that want to understand how they can use digital technologies to enhance their products, and
- Volunteers and Innovation Enthusiasts, who have special interest in certain technologies.
In addition to this we also work with Digital Business and Venture Architects. The focus of this role is more on the development of new Digital Business Models.
As you already can see, there are different types of Innovation Managers and the spectrum of their tasks and responsibilities varies. One works more on a strategic / business level, while others dive deep into digital technologies and explore and realize their capabilities hands-on. We are convinced it needs both to really make a difference in your Digital Innovation Management Journey.
Read more about how others use the role digital innovation manager to speed up and explore the use of digital technologies:
What an Innovation Manager does – 4 main areas of focus
An Innovation Manager ensures the innovative strength of a company and literally manages innovation. The value of an innovation manager is clear for many companies - but what are specific tasks? We have put together a comprehensive Innovation Manager job description for you.
Four main areas of responsibility can be identified in an innovation manager job description. Firstly, the identification and evaluation of relevant innovation topics. Secondly, the management of the innovation process. Thirdly, the communication and exchange with different parts of the organization. And fourthly, the further development of the company's internal innovation management.
- Discover, identify and evaluate innovation ideas
- Management of the innovation process
- Creating and maintaining the innovation ecosystem
- Continuous optimization of the innovation management process
1. Discover, Identify, and evaluate innovation ideas and opportunities
The task of an innovation manager is not necessarily to invent new ideas "from scratch", but rather to observe, analyze and evaluate new trends, technologies, and market developments relevant to the company. Possible changes in demand or needs in the market must be kept in mind, as must the competition and other players upstream or downstream in the value chain. Those ideas can lead to the optimization or the creation of new business models, products, services, and business processes.
Finally, from a large number of innovative ideas, a small number of value-creating and promising ideas must be identified and entered into the innovation process. Most ideas probably won’t work, which makes it even more important to prioritize, evaluate, test and, if necessary, discard many ideas in the end. The more high-quality ideas enter the innovation funnel / backlog, the better.
The innovation manager explores various innovation opportunities and considers them from different perspectives. Innovations here can either arise directly from a business need or they are technology driven. Thus, Technology Foresight, Scouting and Monitoring can also be part of the tasks of an Innovation Manager. A strong source for innovation ideas is the internal and external innovation ecosystem of a company that every Innovation Manager should have.
No new technology is introduced merely as an end in itself; a positive business case must always be apparent, at least prospectively, although technology-led innovations are often an investment in a company's distant future.
During the identification and evaluation of relevant innovation topic and technologies, different ideas are collected, prioritized, and selected. Evaluations can be made based on various dimensions. In addition to the value creation potential for your company, the implementation effort and feasibility can be considered. At the top of the priority list are ideas that combine high value creation potential with low implementation effort. Prioritized ideas can then be incorporated into a technology and innovation roadmap.
2. Managing and organizing the innovation process is the central and most time-consuming responsibility of an Innovation Manager
The central task of the innovation manager is the systematic planning, management, and implementation of innovative ideas – in short: to manage innovation. And despite the widely held belief that innovation and agile methods are often without structure, strong innovation management is a very focused, structured, efficient but flexible process when lived properly.
Because rarely only one idea is pursued, the innovation manager often needs to coordinate several innovation projects simultaneously and, accordingly, many program and project management tasks arise. Thus, depending on the characteristics of the role, an Innovation Manager may go more into a program management role, or he or she may take care of individual projects.
At the end of an innovation process, support is often provided in the preparation of marketing activities. This can go all the way to founding new ventures leveraging digital technologies. Again, this heavily depends on the scope of the responsibilities. But how exactly can an innovation manager develop the identified ideas from a technology and innovation roadmap in a structured way?
Agile project management approaches are the means of choice in most cases when it comes the design and exploration / incubation of new ideas. Innovation methods such as Design Thinking, Lean Startup, Hackathons, and Agile (Scrum) rely on lean processes and iterative testing to develop new product or service ideas and business models. They help to test and implement innovative ideas quickly and cost-effectively, thus increasing the probability of success.
Read more about an example approach here: How to design innovative business apps in an innovation sprint?
You can also find a customer example here: Design a new app in days not months
Here it is important to address different dimensions:
- Desirability: Does the target customer / user want or need something new?
- Feasibility: Is the idea feasible with the technologies we have?
- Scalability: Is the idea more of a local or global issue? how many users are targeted?
- Viability: Does the investment pay off?
- Strategic Fit: How much does this fit with the company's goals and strategy?
3. The role ensures communication between relevant actors within the organization and the larger innovation ecosystem
Innovation management is always an interdisciplinary field. It’s a team sport and needs the support of various players to be successful. This means that intensive collaboration between different units is essential. Innovation managers need to get in touch with relevant parties and initiate dialogs to push business innovation. An Innovation Manager him / herself cannot move mountains (yet). But the teams and experts they pull together to drive innovation ideas ahead can. Those teams can consist of UX Designers, Technology Experts, Business Representatives, Operational Excellence, and Developers, just to name a few. In some cases, they also work hand in hand with futurists, who create very visionary ideas about how a future could look like.
Research and development, Marketing, Product Management, Production and Finance, just to name a few, can all be affected by an innovation and must be involved in decisions. Communication and stakeholder management is key here. However, the Innovation Manager is not only an important link between different specialist departments. She can also coordinate communication between the departments and upper management and often informs the strategic management level about current market and technology trends.
Involving the internal and external innovation ecosystem not only helps to generate ideas, but also to adopt innovations. Thus, creating and maintaining an internal and external innovation ecosystem relevant to the company’s long term innovation strategy is also on the list of responsibilities of an Innovation Manager. On- and offboarding of Partners is also part of the tasks.
Listen to this podcast and get more information about how we run such an innovation partnership: Paving The Way For Digital Transformation and Innovation Through A Strong Strategic Partnership
4. Further development and continuous improvement of a company's internal innovation management
Continuous optimization is also a central responsibility of Innovation Managers. For example, the company's internal innovation processes for managing innovation should be continuously optimized and innovation methods and tools evaluated as well as implemented. The whole process needs to be continuously monitored, success should be measured, and adapted if necessary. It’s also very important to align the approach with the company’s strategy and goals.
Creating and fostering a solid and fertile innovation culture and organization and identifying skill gaps that need to be closed to stay competitive can also fall into the Innovation Managers bag of tasks to improve a company’s innovation readiness and competitiveness. The role indeed acts as an internal Entrepreneur for your company. And it is important that the role has the freedom to do so.
Tools for Innovation Managers
Innovation Managers draw on a wide range of different tools for their work. The toolbox that can be used in a systematic manner is as broad as the work itself. It needs the right tools, approaches, and methodologies. And every innovation horizon needs a slightly different approach and skills.
Here are a few tools we often see in use:
- Technology Radar / Gartner Hype Cycle
- Technology Readiness Level Assessments
- Internal / External Innovation Ecosystem
- Project Management Tools and Methodologies
- Innovation Backlog and Roadmap
- Virtual Collaboration Tools
- Classics: MS Office
- Innovation Management Software
- Storyboarding Tools
- Other Tools and Templates (Business model Canvas, Innovation Project Assessments / Scorecards, Business Case Calculation, …)
- Post its 😉
Skills and Mindset – What makes a good Innovation Lead?
The variety and scope of tasks for an innovation manager also comes with a high requirements profile. The enquired innovation management competency is versatile. But it is not only the innovation manager himself who must bring considerable skills and knowledge to the table; requirements are also placed on the company that wants to create the new innovation roles.
Renewing things is a demanding job. There is constant need to stay up to date. Innovation Managers must enjoy networking and the interaction with all different kinds of stakeholder. It’s a highly customer and end-user-facing role that needs to bridge business and technology. So, what makes a good Innovation Manager?
An Innovation Manager needs both, specific hard skills and certain soft skills and characteristics. The former can be learned well in a suitable training program. Nevertheless, many skills are only consolidated in the course of everyday work and require a lot of experience.
In particular, the identification and evaluation of relevant innovation topics require in-depth expert knowledge of the industry in which the company is active and its products and services. In addition, a solid understanding of a company's business processes and departments is required. Whether logistics, production, R&D, marketing, or HR - the Innovation Manager does not have to be an expert in each area but should understand the overarching processes and be well networked to know the experts for different topics.
In addition to content-related competencies, methodological knowledge is naturally also of great relevance. Agile program and project management skills are just as relevant here as theoretical innovation management approaches. There are many project management certifications available, but nothing beats strong project experiences. In late phases of the innovation journey, technology and innovation marketing know-how is helpful as well.
What qualities and soft skills should an Innovation Manager have in addition to their technical hard skills? In fact, the list of required skills is quite long here as well. Central to this is a very strong entrepreneurial mindset coupled with a great affinity for (digital) technology. Having an entrepreneurial vein that drives you intrinsically definitely is a plus. No interest in technology? Well then you might better look for another job.
The role should be well organized, possess a preference for structure, being able to plan precisely, prioritize well and work in a goal-oriented manner, be communicative and multilingual and, finally, have a good dose of curiosity and a willingness to learn. Enjoying taking over responsibility for results should also come in naturally. First one who raises the hand to volunteer for something? Comes in handy in many situations.
The ideal Innovation Manager also brings along a high frustration tolerance, some creativity, assertiveness, the ability to work in a team, and decisiveness. Being bold and stepping in to say that it is time to end a project because of the evidence you gathered needs a good portion of confidence in your abilities.
Due to the high amount of people an Innovation Manager needs to work with, networking skills come in handy to manage the whole innovation ecosystem. Empathy and an interest in psychology helps in many situations.
How do you become an innovation manager and what does the innovation manager career path look like?
Innovation managers can have diverse educational backgrounds. In most cases, a degree in economics, engineering or computer science forms the basis for the innovation manager role. Selected degree programs with a strong focus on innovation management or digitization are particularly helpful and welcome by companies among applicants. But further training and certification as an innovation manager are also possible.
The extensive requirements for innovation managers are well remunerated. On average, innovation manager salary is about €75,000 and above per year. Of course, this depends on your level of expertise and the industry you are in. But it gives a good and tangible impression, what an Innovation Manager salary can look like.
The role can add tremendous value if it finds a fertile ground in the company
The scope by itself shows why it makes sense not to leave innovation management to coincidence. Without a dedicated role, it becomes difficult; because especially in the operational business, most people's thoughts are on the daily tasks that need to be done. And as the pace of technological development increases, it becomes increasingly difficult to keep track of which technologies can be used for what. Innovation managers can close such gaps and generate enormous added value for the company.
The role of an Innovation Manager is an eclectic job and has a strong and “never-ending” learning curve. Of course, just hiring Innovation Managers probably changes nothing. Also, the organization must be ready for this role and the subsequent change it brings.
If you address it right, Digital Innovation Managers can help you to improve your overall competitiveness, business performance and innovativeness as well as your attractiveness as an employer. So, it is worth the investment. And it is a fun job! 😊
Digital Innovation and Technology Consulting at SAP
From developing new apps for business problems where standard software does not cover your specific needs, to digital technologies for your business processes. And all the way to digital / emerging technology foresight and exploration as well as thought leadership. We cover all Innovation Horizons in strong collaboration with our award-winning Innovation Ecosystem. Follow our digital innovation blog to stay up to date. Questions about digital technology management and innovation? Feel free to contact us. We are curious to hear what you want to drive ahead.
Interested in becoming an Innovation Manager? Here you can find open positions: Innovation Manager Jobs.
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