Innovation in the built environment has reached base camp - now it’s time to scale the mountain summit.

Innovation in the infrastructure sector is essential if we are to achieve the outcomes that society, organisations and their customers need: sustainable development, resilient services, thriving communities, and better value for money.

Asset owners and operators in energy, transport, and water are each able to innovate independently, but given that many of the challenges faced by infrastructure are system-wide, there is a limit to the amount of value that can be achieved at an organisational level. The built environment is a complex, interconnected system of systems serving society, and the industry will achieve more by working together, with an approach that recognises this. Digital technology can be a key enabler for this systems-thinking approach, helping the industry to achieve innovation benefits at pace and scale.

The results of our research with stakeholders in the supply chain reveal significant characteristics of the regulated environment that hinder the success of innovation – including red tape, funding cycles, a low-risk appetite and long-established approaches to solutions. In a new white paper prepared by our innovation specialists in collaboration with infrastructure owners and operators, regulators and SMEs in the energy, transport, and water sectors, we outline how the industry can collaborate to overcome these challenges.

In its efforts to climb the mountain of innovation, the industry has reached a position whereby strategies and processes are in place and ideas are being generated: this is base camp. It is now time to shift to a higher level, address complex challenges of management and organisational capability, and support the effective implementation of scalable innovations that will help us attain the highest peak.

Gearing up innovation for success

To achieve their aims and overcome their common challenges, organisations in the transport, water and energy sectors will need to look at innovation more holistically, and put in place the right capabilities, resources and leadership to drive it at every level. Here are four keys to success in doing this.

1. Be outcomes-focused and examine value to your business and society at the portfolio level. Outcomes are achieved through a variety of different means and innovations. If one innovation project is not successful, it does not mean it hasn’t contributed to the success of another innovation and your knowledge bank.
2. Transform the core. Innovation is not an add on - transforming what happens in the core operational business is necessary to enable benefits to be realised at scale. Transforming the core is dependent on two aspects: process and people. You need to understand the maturity of the affected organisational capabilities and how they relate to redefined processes.
3. Build, measure, learn. Innovation is not linear; agile principles and design thinking should be at its centre. Users need to be at the heart of decision-making with a culture of continuous learning and iterative development, so that development can be lean and efficient.
4. Collaborate across the ecosystem. There is no such thing as a ‘digital only’ project and diversity of thought matters. A broad range of stakeholders inside and outside of the organisation can be the difference between a failure and a success, because perspective contributes to a systems-thinking approach.

Trends on the horizon

These are trends we are starting to notice across the industry. We highlight them because they will help asset owners and operators when trying to innovate at pace and scale. They will also allow the supply chain to support asset owners and operators effectively. The trends are:

Co-opetition over competition. Partnerships between traditionally competing companies can generate new net value for those involved. If they are aligned and delineated correctly, and the value generated is divided appropriately, then there can be a win-win, moving the landscape from a zero-sum game to one where the end results benefit the whole.

Better over more. It is important to focus on the quality of innovation, rather than the quantity of it. Organisations should play to their strengths, concentrate on the best innovations and partner with experts that help them move at scale. When assessing digital technology and what is right for the business, they need to adopt an agile mindset defining what is ‘good enough’ at the outset so that innovations can be tested at pace.

Systems over silos. Taking a systems-thinking approach means removing the barriers of linear and segmented thinking. Whilst assets have a defined step-by-step lifecycle, a systems-thinking approach recognises that no asset is self-dependant or isolated. An increased focused on the system in which assets belong can enable key points of value, for example climate resilience and increased customer satisfaction.