Analysis 4: February 2016

The company set new strategic objectives in February 2016. These strategic objectives and the derived projects were based on the new business strategy, which was introduced in late 2014. The following analysis was conducted on the company shortly after February 2016.

7.3.4.1 Step 1: Document the Current (February 2016) Business and Innovation Domains In step one, each of the three components in each of the four domains in iSAM are described for the company. This is achieved through analysis of strategic and operational documents and discussions with the company’s management (see Appendix H for list of strategic and operational documents analysed). Between analysis 3 (February 2015) and analysis 4 (February 2016), there was no significant change to the company’s business strategy, however, there were some minor changes to two of the components in the four iSAM domains . The following list presents the key outputs for this step of the

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approach. A high level description of the minor changes from analysis 3 (February 2015) to analysis 4 (February 2016) is also provided.

1. Main target market: Donor funded HSS projects for departments of health in developing countries & Analytics projects for Life Sciences companies, executive government structures and donors

2. Main products: HSS technical assistance through packaged solutions, analytics TA and analytics products (IT system), data as a product.

• Change: Products expanded to include HSS technical assistance through packaged solutions and data as a product.

3. Key business principles: Social entrepreneurship, data driven, scalable and sustainable solutions, blend private and public sector approaches.

4. Distinctive competencies: Global network and reach along with local understanding of how government services are delivered on the ground, able to operate in both the public and private sectors, analytics and software development capability.

• Change: Significant improvement in analytics and software development capabilities. 5. Primary generic strategy: First to market generic strategy, attempting to be seen as leaders

in their field by being the first to introduce a solution or to follow a novel approach.

6. Innovation scope: Type - Strong product, medium strategic, weak process. Level - Strong radical, medium incremental. Impact - Medium sustaining, strong disruptive.

7. Innovation governance structures: No formal innovation governance forums or structures exist in the company.

8. Innovation capability maturity level: Unaware of innovation. Although innovation is communicated as an important part of the competitive advantage and culture of the company, there is no formalisation of innovation to a point where the understanding of the term innovation is not always clear.

9. High-level structure: Standard hierarchical structure, which is three to four layers deep 10. Competency framework: A competency framework consisting of five dimensions and 40

relevant competencies is used in the company.

11. Innovation model: Visionary leadership is implicit dominant innovation model. 12. Innovation processes: No formal innovation processes exist in the company.

13. Innovation competencies: There are several innovation related competencies in the overall company competency framework.

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15. Innovation competency improvement activities: There are no innovation specific innovation competency improvement activities.

7.3.4.2 Step 2: Assess Functional Integration

The improvement in functional integration, identified in analysis 3 (February 2015), between the company’s preferred generic grand strategy and the innovation scope is also revealed through analysis 4 (February 2016). Based on an analysis of the company’s current and planned projects, the company has a far stronger focus on product innovation (92.6% of innovation projects). There has been an increase in strategic innovation projects but still only 7.4% of innovation projects fall into this category. Although this is an improvement in alignment with the “first to market” generic strategy, it remains misaligned due to the low percentage of strategic innovation projects. The company continues to have a far stronger focus on disruptive and radical innovation, which is very much aligned with its “first to market” generic strategy. 81.5% of innovation projects are categorised as radical innovations and 92.6 % of innovation projects are categorised as disruptive innovations. The number and percentage of innovation projects have once again increased since the previous analysis. In analysis 4 (February 2016) 27 (51.9%) of 52 projects are categorised as innovation projects. The results of the project analysis is presented in Table 24. From a functional infrastructure and process integration perspective, there continues to be few formal innovation infrastructure and processes in the company, and therefore once again, as with the previous three analyses no level of alignment exists.

Table 24: Results of analysis of project innovation scope (analysis 4)

Analysis 4 (February 2016)

Total Number of Projects 52

Number of Innovation Projects 27

% Innovation Projects 51.9% Innovation Type Product 92.6% Process 0.0% Strategic 7.4% Innovation Level Radical 81.5% Incremental 11.1%

Innovation Impact Disruptive 92.6%

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7.3.4.3 Step 3: Assess Strategic Fit

As in analysis 1 (December 2013), analysis 2 (October 2014) and analysis 3 (February 2015), there is no strategic fit from an innovation perspective in the company. The company still does not have a formal innovation strategy, but even if the implicit innovation strategy is taken into consideration, there is no formal innovation infrastructure or process.

From a business perspective it is not possible in the context of this dissertation to analyse and assess the business strategic fit. The scope of the business strategic fit is significant and includes all of the company’s operational processes, equipment, personnel and skills.

7.3.4.4 Step 4a: Determine Appropriate Dominant Strategic Alignment Perspective

After the change to the business strategy in late 2014 the company has focused the scope of the implicit innovation strategy so that there is far better functional strategic integration. However, due to the ongoing lack of progress in formalising an innovation strategy, the continued low percentage of strategic innovation projects and the lack of innovation infrastructure and processes, there continues to be misalignment in the company. Therefore as in analysis 1 (December 2013), analysis 2 (October 2014) and analysis 3 (February 2015), 4a in Figure 25 is the next step in analysis 4 (February 2016). For very much the same reasons given in analysis 1 (December 2013), the innovation transformation perspective would still appear to be the most appropriate dominant perspective for the company in analysis 4 (February 2016). This decision, as in analysis 3 (February 2015), is further supported by the recent change to the business strategy. The dominant alignment perspective will guide the steps through the alignment pathway in step five of the approach.

7.3.4.5 Step 5c: Innovation Transformation Alignment Perspective

The pathway to alignment, based on the innovation transformation alignment perspective, is presented in Figure 26 and is the same as in analysis 1 (December 2013), analysis 2 (October 2014) and analysis 3 (February 2015). This alignment pathway involves 11 steps, in which the required changes to the four iSAM domains are identified and the current and planned projects are analysed to check their alignment with the four domains. For the company in the case study, 52 current and planned projects were identified and analysed shortly after February 2016. The alignment of the projects was analysed using the alignment questions, presented in Appendix B. The breakdown of the 52 projects by project category is presented in Table 25.

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Table 25: Breakdown of 52 projects by project category

7.3.4.6 Results of Analysis 4

The analysis of the 52 current and planned projects in analysis 4 (February 2016) reveals that there is the highest percentage of innovation projects in the project pipeline out of all four analyses. In analysis 1 (December 2013) 29.7% of the projects were determined to be innovative, while in analysis 2 (October 2014) the percentage of innovative projects dropped to 9.5%. In analysis 3 (February 2015) this percentage increased to 45.8% and in analysis 4 (February 2016) that has increased further to 51.9%. The level and impact of these innovation projects continues to be closely aligned to the “first to market” generic business strategy, with a high percentage of innovation projects being both radical and disruptive ( 81.5% and 92.6% respectively). However, the type of innovation projects remains a concern for alignment, as a high percentage (92.6%) of innovation projects fall into the product innovation category. As in analysis 3 (February 2015), the company still does not have an explicit innovation strategy. However, the new business strategy and the implicit innovation strategy remain aligned as in analysis 3 (February 2015).

The area of poorest alignment in the company remains the innovation infrastructure and processes domain. No formal innovation infrastructure and processes exist and there are no current or planned projects aimed at rectifying the situation. The implication of this shortcoming are the same as in all three previous analyses. The company will continue to have limited ability to truly achieve a “first to market” grand strategy in a consistent way. The results of the innovation transformation perspective analysis along with recommendations are presented in Table 13.

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Table 26: Summary of Analysis 4 (February 2016) Results with Recommendations