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Everyone is talking about budget / planning again. In business, planning is part of everyday working life. Especially at the end of a year, you can hear people talking, even on the bus to the plane, about the budget of the following year. Assumptions are made, scenarios created, models refined.
But when does the planned work go into implementation? The answer is not always that easy. If you think now that the budget will be implemented next year, rest assured that reality will hit you quite differently. Because reality meets a planned structure in a form that corresponds only in exceptional cases to 100% of what people thought it would be.
Now budgets for the coming year are regular plans that need to be implemented. About the meaningfulness of these plans can be argued aptly elsewhere. In this post I would like to take a closer look at investment/innovation planning. An investment means an expenditure on something new in itself. Even if a replacement or renewal is made, this is a new decision (for the existing structure). Large organizations have complex decision-making processes to protect against expensive bad investments. Interestingly, these are also analyzed in a much more structured way than their ugly siblings, the lack of investment. In itself, the expenditure for something new has a need for discussion: It has to be explained why something is done. Not so intense is the discussion about what is not being done. The simpler way therefore always is to do nothing. How often do you read about wrong decisions and how little do you read about missed opportunities?
That means a difficult starting position for innovations. At this point agile methods are helpful. You say to the person having an idea: Just do it. This has nothing to do with anarchy, but is still very structured. The large investment is broken down into seven steps, which can mean a stop in spending at any time and mean manageable expenditure per single step. But attention: none of the steps may be skipped. Otherwise it will be expensive! And this is the sequence: Ideation, idea screening, concept development and testing, profitability analysis, product development, market test, market entry. How this works in your company and why this is even just phase 2 in the design thinking process, we will be happy to explain in a personal conversation. Contact us!