Innovation: It’s More Than Technology
Written by By Victoria Smith, Innovation Program Manager, and Rick Khan, Chief Innovation Officer, STO Building Group
Why is culture important for innovation, and why is it important to differentiate innovation from technology? STOBG innovation program manager Victoria Smith explains why innovation is about more than robots on jobsites or the latest and greatest workforce management software.
First, it is important to distinguish innovation from invention. Innovation is a new way of thinking or doing things that create new value for our organization or for a customer. Invention is doing something new for the sake of being new. That new process, workflow, or technology might be cool, but it does not solve an actual business problem or bring significant value to an organization in the form of time, wellbeing, or ROI. Invention can
encourage great new ideas, while the STOBG Innovation team is focused on solving our industry’s biggest challenges and finding the best ways to get the job done for our clients.
Second, there are lots of different ways to “do” innovation. A quick web search reveals hundreds of ideas, theories, models of innovation…so much that it starts to feel scary, hard to navigate, and—let’s be honest—a little intangible. At STOBG, we are defining three different types of innovation:
Transformative innovation. Often called disruptive innovation, or “big I” innovation, this is probably what most of us think about when we think of innovation. The truth is, this is only about 10% of all innovation but has the opportunity for the greatest ROI. Think about Uber disrupting the entire taxi industry, Amazon taking over ecommerce, and Tesla EVs. These are transformative, disruptive innovations that changed everything about our behavior from 10 years ago. And that’s about how long these big changes take—10 years. Uber didn’t just pop up one day and disrupt the entire transportation industry. They worked quietly behind the scenes and had leaders who believed in them, encouraged their ideas, took chances, and most importantly,
gave them funding.
Emerging, or adjacent, innovation. This type of innovation is what most of our construction technology software tools are focused on—think virtual reality, the internet of things, drones, BIM, VDC. These are tools we use to get our jobs done, and that some customers even ask for, but they aren’t really standardized or fully adopted. This is about 20% of innovation and provides about 50- 60% ROI. That said, BIM and VDC have been around for 20 years, and they still aren’t fully adopted. What gives?! Innovation is a people problem and a process problem because no technology will ever be fully adopted unless people decide to use it. Innovation must consider who the end user is, how their behaviors and process would have to change, and who would be willing to pay for it.
Incremental, or “small I,” innovation. This innovation doesn’t get much attention but it is actually about 70% of all innovation and provides a 10%-20% ROI. Small changes lead to big shifts, and even these small changes can reduce the friction between a person and their work routine. For example, tapping your metro card for the subway instead of swiping it saves less than two seconds per person, but we all appreciate it!
This is where culture comes in. Innovation is about solving a problem in a new way. In order to do this, people have to feel comfortable voicing concerns, trying new things, and possibly even failing. Not every idea will be transformative, and not every solution will stick. This requires recognizing opportunities to take calculated, controlled risks. At STOBG, our family of companies has a larger responsibility to focus on our people and build a culture of innovation within and across our different companies so that each can continue to do what they do best.
While robots on jobsites might be cool, they alone are not innovation. Creating new business value, fostering comfort with new ideas, and developing a problem-solving mindset—that’s where innovation thrives.