Last month John C. Lechleiter, chairman and CEO of Eli Lilly and Co., spoke to an audience in San Diego about the need to improve innovation efforts. "We're taking too long, spending too much and producing far too little," he stated.
Lechleiter was specifically addressing biopharmaceutical innovation in his speech, but his words reflect the sentiment of many companies across a broad range of industries. Indeed, in a recent survey of senior executives by Boston Consulting Group, just 52% of respondents reported being satisfied with the return on their companies' investments in innovation.
The continuing challenge for these firms, of course, is how to improve the opportunity for success of innovation initiatives. The recessionary economy has only heightened the need to succeed.
For his part, Lechleiter prescribed a three-pronged solution to improve medical innovation: collaborating with other large and small enterprises, and with academic and government researchers; employing advanced scientific tools; and putting patients and improved outcomes at the center of the research from the very beginning of the drug development process. As an example of Lilly's efforts in the collaborative arena, Lechleiter cited the pharmaceutical firm's Fully Integrated Pharmaceutical Network, which accesses ideas, resources and talent from outside of the organization's four walls.
Lechleiter's example reflects a common theme. That companies are looking at a wider range of sources for innovation, both internal and external, was among the key findings of a global innovation trends study from the Product Development and Management Association (PDMA) and PRTM management consultants.
What other means boost companies' efforts to improve their innovation pipeline? Consider these strategies:
Change the emphasis. A growing emphasis on corporate strategy to drive innovation is how many companies aim to improve global innovation. Indeed, some 87% of participants in the PDMA/PRTM study are investing to improve that linkage, study results show.
Create a program management office (PMO). Clarkston Consulting suggests that a PMO is an ideal way to revive a lackluster innovation engine. "A PMO for innovation would combine key business stakeholders such as commercialization, marketing, R&D, product supply and quality in the prioritization of new product initiatives to guide budget decisions as well as manage new product launches," suggests the management consulting firm in a white paper.
Improve your product portfolio management strategy. Successful product portfolio strategies help companies make the most of limited resources when it comes to product development, notes the Aberdeen Group in its report "Managing the Innovation Portfolio." The steps best-in-class companies take to develop successful strategies include: defining ownership to make project kill decisions (dropping failing projects sooner is a key objective of portfolio management); using dashboards to get a high-level view of product portfolio value and enhance decision-making ability; and increasing the visibility of product development workloads. As Aberdeen points out, limited resources constrain the efforts of product development teams. Central visibility makes it easier to assess the number of projects in the pipeline and determine whether it is simply too full to manage.