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Beginner’s Guide to understanding Digital Innovation

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When you have a necessity, you go past the tradition, overcome insecurities, push the limits, go beyond anyone’s imagination, and eventually, a marriage of creativity, requirement, and skills gives birth to what is otherwise known as “Innovation”.

Quite dramatic, agreed. Yet it is true for the digital realm.

Each year many companies push their limits for their Digital Innovation to stand out.

Whether by design or by default, the bottom line is Digital Transformation is the heart of your digital initiatives and Digital Innovation is the soul. Without them both, nothing worthwhile happens.

In this post, we’re going to cover:

What is Digital Innovation?

Digital Innovation is the application of new technology to overcome existing problems, improve processes, and enhance the user experience by creating new products or methods.

Every few years, we see a new wave that changes the business landscape. With each passing wave of change, the cycle gets shorter and the adoption rate grows exponentially.

In the early 20th century the telephone took a decade to reach from 0.6 million to 6.0 million users but with smartphones, we have over 5 billion users in just a matter of a few years.

Organizations today are open to innovation and are innovating at a rapid pace. The magic of Digital Innovation is no longer limited to just tech-savvy companies.

We are living in exciting times as the new wave of technologies is creating a significant impact in the early stage and the future looks bright.

The latest digital innovation trends:

  • Artificial intelligence and Predictive Analytics: It is the marriage made in heaven, it helps to make sense of complicated data and make accurate forecasting ahead of time. Predictive analytics uses historical data, machine learning to identify patterns and AI is used to provide valid solutions and enable execution by considering several scenarios.
  • AI-powered automation: It helps to understand data and identify processes that can be automated. In short, it enables proactive process optimization by eliminating manual labor.
  • Robotics: It replicates human actions and can function in a hostile environment where humans cannot. It eliminates life-threatening risks.
  • 3D printing: It uses computer-aided design also known as CAD to create 3-dimensional objects. The process involves layering material to create a variety of products in different shapes, sizes, colors, and rigidity.
  • IoT (Internet of things): It helps to gain data of physical objects from a remote location. It helps to measure and analyze the value and condition of any object or product. It also multiple objects to communicate with each other.
  • AR/VR (Augmented Reality/Virtual Reality): VR replaces the vision while AR adds to it. VR replaces the field vision and projects different scenarios. With AR the image is projected over whatever the user is looking at. It helps to educate, provide additional information and enhance the experience.
  • 5G: It is meant for higher data speeds, low latency, immense network capacity, easy connectivity, support modern technologies, and consistent user experience.

These technologies are:-

  • Artificial intelligence and Predictive Analytics
  • AI-powered automation
  • Robotics
  • 3D printing
  • Nanotech
  • IoT (Internet of things)
  • AR/VR (Augmented Reality/Virtual Reality)
  • 5G

In this era, every other organization is a tech company as they are under the influence of the digital medium in one way or the other. Traditional businesses are changing their ways to stay relevant in modern times by ensuring fundamental transformation and innovation, while modern businesses are pushing the envelope to stand out and manage digital disruption.

Why Digital Innovation is important?

59% of the organizations feel that they are already late with their digital efforts. This is a matter of serious concern as not adapting to change at the earliest could have an adverse effect at a later stage.

Most organizations find innovation difficult because they fear change, assuming that they will lose their existing clients and market share. But the truth is quite otherwise.

Fear is the mortal enemy of creativity, innovation, and happiness

– Alex Bogusky

Let’s consider the example of one of the biggest and most successful cellphone companies of the previous decade that failed because of fear of innovation.

Yes, we are talking about Nokia. A brand that dominated the cellphone market up until 2008 and crumbled by 2011.

Nokia, over the years, focused too much on its hardware and not much on the software. With the advent of 2007, smartphones with software advancements and improved customer experience dominated and Nokia not capitalizing on it made things worse for them.

That is not to say that Nokia was not innovative at all. Their innovation was restricted to their hardware and not with the software or experience. By the time they could amend their mistake, it was too late and by 2011 they were only left with a 3% market share.

Part of the reason is that they didn’t want to disappoint the customers by doing something new. Although, historically, Nokia is famous for innovation as in the 90’s they sold most of their conglomerate business to enter the cellphone market and they dominated it.

The lesson that we learn is never to stop innovating even if you have a strong brand value.

Giants like Kodak, Hitachi, and Toshiba missed the mark just because of their delayed approach and fear of innovation.

Being afraid of change is understandable but outright writing it off will hamper the growth of the organization.

Rather than being averse to change, organizations must evaluate their options in collaboration with stakeholders and must take necessary action.

Why prioritize digital innovation in your business?

The digital innovation process necessitates an open mind and preparedness, and awareness of how data, design, and technology will affect them across departments – HR, finance, purchasing, marketing, and even product development.

Digital technology innovation enables organizations to access data-driven insights. These data insights enable your business to streamline resources in a consolidated manner and encourage a tech-driven culture that makes every process simpler and effortless.

The process of Digital innovation and strategies

When a company opts for digital transformation practices, they switch from traditional approaches to a more reformed approach involving innovations in technology. The road to digital innovation can go multiple ways, depending on the specific needs of the company. This can involve creating strategies for technology adoption and training for the team to become comfortable with the new technology.

If you want to invite the future profitability of your company, then digital innovation is a must. Digital innovation must be prioritized as it implements the use of advanced technologies to solve existing business issues.

Digital innovation may seem expensive in the short term, but with organizations that invest in new and better ideas, digital innovation streamlines internal processes and improves equipment performance. In other words, it’s an investment for long-term financial gains, resulting in substantial cost savings and high ROI across business expenses.

The reasons why should embrace new digital innovations is to acquire the following:

  • A competitive advantage against businesses providing the same products or services.
  • An improved efficiency where all the business processes are streamlined.
  • Technology solutions that boost your revenue and ROI

Digital innovation ideas

The digital year had started and the heavy reliance on technology and software became a requirement for a business to cope with others. Digital technology innovation is a must today because it is the key to entering the new arena where everything is highly driven by digital things.

The most important thing about digital innovation is to get the entire business on board and align with the strategy. If only a couple of departments or teams commit to digital innovation, the lack of consistency across the entire group can cause digital disruption. Provide adequate employee training and make sure the overall goal is understood.

What does successful digital innovation look like?

Successful digital innovation is one where the technology works alongside the employee. Being able to seamlessly transition between tasks and processes in a way that is effective and efficient are the signs of successful digital innovation. Digital technology innovation success looks like having cloud computing, new software, automation, or data analytics in your organization for improving the efficiency of work.

How to achieve digital innovation?

To achieve digital innovation, businesses should first be open to adopting the changes in operation due to technology. The willingness to give up manual and outdated processes in the organization and to train employees to be familiar with handling digital processes also matters here.

With digital innovation, it is possible for an organization to respond to changes quickly, a much-needed factor in today’s fast-paced economy. There must be a thorough assessment on which software, tools, and equipment will suit your organizations’ needs.

How to measure digital innovation?

Digital innovation can be measured by assessing the productivity of the whole organization. See how much overall improvement that the company has had after adopting the changes. Also monitor the number of processes that the new software, tools, or equipment can complete.

Companies can also assess the increase or decrease in profit as a measurement of the success of digital innovation. For example, in a production setting, you can measure digital innovation by the quality and quantity of the output compare to when processes were completed manually. The accuracy and quality of the result of the process is also a deciding factor when measuring digital innovation.

What are the risks of digital innovation?

Digital innovation can open you up for specific security risks that might be tough to fight against. If you adopt digital innovation without the appropriate cybersecurity measures, you could end up hurting yourself and your company.

Digital innovation always poses security risks and, if done hastily, can threaten a business’s goals. One of the main risks is that businesses may become overly reliant on technology and create products and services that are not user-friendly. Also, businesses can embrace new technologies without understanding how they can be used to improve their business. This can lead to inefficient use of resources and a lack of productivity.

How Digital Innovation has enabled businesses during COVID-19 

The pandemic brought in a lot of changes for businesses across the globe, wherein every single one of us has been greatly affected by the change. Whether it’s a restaurant chain or a giant enterprise, every organization has had to go back to the drawing board to find the solution to ensure business continuity.

Most of the companies had to utilize their digital aptitude and prowess to fit into the new normal. 

The companies which focused on digital innovation and business to stay ahead of the curve sustained the impact of the pandemic. Some have even utilized this unexpected scenario as an opportunity to test their preparedness and effectiveness of their digital infrastructure. 

According to Provokemedia, companies like Hyundai became the first car manufacturers in India to sell their cars online which help them to withstand the impact. 

Classpass is a fitness platform that connects gym-goers to the right fitness studios or trainers, this was achieved as Classpass was able to pivot its business model. 

They facilitated their partner fitness studios to provide online fitness training to their clients on any streaming platform like Facebook, YouTube, or Twitch by sharing the training details on their platform

Plus, on-demand fitness training is also available on their platform for all their subscribers. This way they made sure that neither their partners and nor the subscribers leave the platform. 

Digital Innovation process has saved many companies from succumbing to the pandemic’s repercussions. Now, many businesses understand its value and have initiated the journey towards Digital Innovation.  

“Digital Innovation is not an option anymore it is a trait that must be ingrained within the DNA of the organization.”

Difference between Digital Innovation and Digital Transformation

Often, Digital Innovation is often mistaken as Digital Transformation and vice-versa. Both these terms are used interchangeably but are different. Both are inclusive of each other and one could lead to another –innovation can lead to Digital Transformation and transformation can pave way for innovation.

Modern business owners and leaders must understand the difference between the two as they are the ones who make crucial decisions.

  • Innovation happens all of sudden, it is like a spark that takes place once in a while but when it occurs it takes a system by storm. On the other hand, the Digital Transformation journey takes time, it is a defined process that implements a well-structured digital enablement strategy that incorporates traditional and innovative technology to bring about a fundamental change.
  • Innovation occurs because of creativity and in most cases, the initial occurrence takes place at a small scale, while transformations are powered by a strategy that may have components of innovation but is usually focused to improve the engagement, infrastructure, culture, and most important of all meet customers demands.

Digital Innovation Platform 

Innovations can enable organizational, industrial, and social change. For example:- The concept of Digital Adoption Platform, or DAP, came into being about a decade ago and since 2016 the existence of what we now call a Modern DAP came into the picture which disrupted the field of Learning & Development.

Today, people can be trained on any application irrespective of their location. User is not bound by time and can learn at their own pace. Specific knowledge can be imparted to a specific user at any given time.

Organizations can analyze the effectiveness of the deployed application and provided training from anywhere around the globe using the Digital Innovation Platform .

All this became possible because organizations, large and small, went through the transformation to accommodate innovations like these.

Innovation could take place post the transformation phase as well and could challenge the existing or established system. For example – Digital Innovation Platform changed the landscape of L&D and since this occurred most of the organization reinventing their methods and trying to utilize DAP to its full potential which is leading to innovation within and across the industry.

Once a solution like Digital Adoption Platform becomes part of the user’s routine, it becomes easy to train them with new applications and guide them through new updates and Digital Adoption becomes easy.

It makes things easier for both, the user and the organization, as companies can bring necessary changes to the application and users can consume them without being dependent.

Here DAP is the innovation and how businesses adapted this technology to make the training process easy is transformation.

What are the benefits of Digital Innovation?

  • Disrupts industries and brings a tsunami of change in the process.
  • Once the innovative spark is generated, it enables collaboration, interaction, skill enhancements, change in modules, approach and provides a possible foundation of Digital Transformation
  • Boosts ROI and helps to save on essential resources.
  • Facilitates an atmosphere of competition among different organizations which further creates room for innovation.
  • The competition enables better facilities to the customers at a better price.

The top digital innovation programs  

  • Driving strategic innovations: MIT and IMD conducts a program that combines the nuances of technology and leadership in a very unique manner. It helps managers to become innovators and tech leaders. It helps them to think about how their innovative skills can help the entire organization to innovate and drive transformation.
  • Disruptive innovation: This program is conducted by HBS which helps the learners to participate in the dynamic learning environment and involve in small group discussions and case studies. Here the explain the strategies related to both disruptors and disrupted. It also helps to implement strategies into strategic decisions.
  • Leading Digital Transformation and Innovation: This program is created by INSEAD. The course helps you to experience the same course content as that of the on-campus sessions. It teaches digital action plans to identify innovation-based opportunities and create a strategy to overcome the existing business problems.

Digital Innovation Examples  

A. Disney 

The entertainment landscape is changing drastically. The users have multiple options at their fingertips with the advent of streaming platforms like Netflix and Amazon.

To stay relevant Disney acquired BAMTech to include streaming services in their entertainment stack. This helped them to connect with the people as they were able to entertain them without them leaving the convenience of home. It also reinstated the brand value and acted as a promotion channel for their offline entertainment products.

B. Disney Rockwell 

The manufacturing automation giant Rockwell envisioned the future of a connected enterprise. The goal was to connect different technologies, systems, and people to create a cohesive environment where data helps to understand the problem in real-time.


IKEA is the furniture giant and it always tried to leverage the digital medium. In 2017  they acquired TaskRabbit an online marketplace with a strong mobile app. It matches freelance labor requirements with local demands bolstering its service capabilities to stay as the leader in the segment.

The Way Ahead…

Innovation is just like a new magic trick that excites people. It could be a rare or a regular event but that depends on the process in place.

Businesses are changing rapidly and they have to innovate to stay relevant in the age of digital evolution.

Stay on top of current trends and technologies to stand out in the market. Bring your teams together, encourage ideas, and in turn, create a culture that pushes the envelope each year with innovation.

Digital innovation can bring about endless possibilities if only done the right way.

FAQs on Digital Innovation

1. Why is digital innovation important?

Digital Innovation holds great importance for businesses as it improves customer experience and engagement. Customer retention, loyalty, and satisfaction have always been critical to a company’s survival and success but with the help of digital innovation, companies can achieve all this.

2. How do you achieve digital innovation?

In a changing business environment heavily dependent on tech and automation, digital innovation helps an organization on several fronts, from customer acquisition and retention to employee engagement and process acceleration. Enhanced visibility, data security, and easier collaborations between departments are some of the advantages of prioritizing digital innovation.

A strong focus on risk management characterizes successful digital innovation in business. The company can identify and mitigate potential risks before they have a negative impact. This includes adopting security measures to protect customer data and ensuring that new technologies do not create vulnerabilities that hackers could exploit.

3. How does Digital innovation help business?

Digital innovation can help you stay competitive in today’s rapidly changing marketplace. To be successful, businesses must continually adapt to new technologies and changes in consumer behavior. Failing to do so can result in missed opportunities and undesirable outcomes.

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Krishnan Kaushik V

Krishnan Kaushik V

Krishnan is a Marketer and Content Crafter. He has an in-depth understanding of Digital Adoption, Transformation, and Enterprise applications that helps business to generate business outcomes. In his former life, he was an IIoT & Automation engineer. You can find him trying new recipes, riding a bike, and wondering about the most complex object on the face of the earth i.e Human Brain.

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