Innovation is more often discussed in relation to identifying and meeting consumer needs and creating market opportunities. A new product or incremental improvement may increase the ROI on a SKU. But the real business value of innovation comes from improving processes that lead to systematic efficiency, cost savings, and competitive advantages.
Unlike products, which have an expectation of change, obsolescence and evolution, operational infrastructure is designed for rigidity, efficiency and scale. This creates challenges to achieving innovation ROI, demonstrating feasibility of new ideas and iterative prototyping and problem solving. Organizing operational innovations as an independent function is important because, just as consumer-facing innovation does, its role is to challenge the status-quo and disrupt.