Innovation is fundamental for a business and needs to be a continuous process, Discovery Group CEO and founder Adrian Gore has said.

Speaking on day one of the Africa Strategy Conference, on October 21, he noted that he has observed six key learnings from innovation implemented at Discovery.

Firstly, he mentioned that great innovation comes from complexity and necessity and that it should be purpose driven.

Gore said that, in South Africa and the rest of Africa, there is considerable complexity and necessity, which opens up many opportunities for innovation.

He elaborated on Discovery’s experience of this in South Africa, saying the company was looking at implementing a health model about two decades ago. At that point, there was a low level of doctors, a high level of communicable diseases and a government focused on an egalitarian regulatory environment to address historical disadvantages.

This complexity meant that building a sustainable health model required focusing on making people healthier, rather than focusing on the pricing and supply side of healthcare.

Therefore, the innovation that came out of this was the Discovery Shared-Value Insurance Model – a purpose-driven model incentivising people to make healthy lifestyle choices and rewarding them for this, Gore explained. 

He noted that shared value has engendered better profitability for the business – the more the company does for society, the better it performs.

Therefore, the group has built a business model on an innovation from two decades ago, that is profound and rooted in the complexities of the country, and is based on shared value, Gore said.

Secondly, he said, great innovation is repeatable and scalable.

He noted that Discovery’s work across different countries and markets has allowed it to learn what is scalable and what is required at different levels locally, and how to implement innovation in different environments.

He said the core thing to remember was how humans globally respond to incentives; therefore, Discovery’s model can be scaled globally and repeated, with tweaks for local requirements.

He also highlighted that it could be applied across different industries.

Thirdly, Gore said innovation was recursive and infinite. He explained that innovation begets more innovation, with innovation opening up more avenues, such as the learnings of behavioural science, engagement and analytics in Discovery’s case.

This can then be used to open up many more opportunities; for example, Discovery can use causal inference models to predict health outcomes and disease at risk outcomes.

Fourthly, Gore said innovation should be profound, as that leads to prudence. He indicated that profound innovation and prudence are not mutually exclusive.

For example, Discovery is considering applying shared value in banking.

Fifthly, Gore said innovation needs to be forced.

He said companies sometimes come up with one great innovation, but then rest on their laurels and stagnate, and are wary to innovate further.

Therefore, at Discovery, the group has a cycle-based approach to innovating, where every year, each department is tasked with coming up with new innovations. This ensures that there is a continuous cycle of innovation, Gore explained.

He said that an approach of waiting for an event to happen to innovate, or doing it in response to a competitor, does not work, as it is usually too late by then.

Lastly, Gore said there was a need to create a culture of innovation.

He added that the art of getting a breakthrough was starting with the end in mind, and that creating the vision was the most difficult part.

Further, he said that practicality must be kept away from ideas, with people needing the freedom to fail and raise ‘stupid’ ideas without boundaries and there should not be a hierarchy of ideas.