Speeding up corporate innovation
A major corporate innovation consultancy bemoans the fact that corporates readily experiment with the latest innovation practices but without clear ideas on what they want to achieve; and offers a more disciplined approach.
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‘Why is it that so many executives still claim that results are not what they expect and after a few years of trying, shut down innovation initiatives?’ they ask. They see corporates asking what to do to innovate and more specifically how to do it before addressing one other critical question; innovation to achieve what? As a result, many companies end up executing the hottest and latest approach in innovation they have heard or read about.
Many big companies use a venture arm (such as Google Ventures, Unilever Ventures , Distill Ventures, Santander Innoventures and GlaxoSmithKline’s SR-One) to seek out startups in which they can invest (and to which they can contribute) to see whether they will generate the innovation they seek. But the corporate world is reportedly sitting on vast cash piles rather than make investments, so should innovation be treated (as this article suggests) with the same disciplines as the rest of the business?
To deal with their concern – that many corporates play at innovation, the approach being proposed aims to engage a group of senior executives and stakeholders and to help them to align their perspectives and ambitions for innovation, and understand choices and tradeoffs they need to make before starting an innovation initiative. They need to ask “What is our vision of success for innovation in our business?” and “What should our innovation capability look like?”
The approach they suggest first asks these executives to look outside of the company and define what significant changes they see occurring around them now and in the future, what they believe the implications of such changes are for the company; and then to prioritise those that they can and should address with innovation.
Next they need to explore the scope for innovation: what types of opportunities at what stages of development will the work address, and how broad should participation be?
The conversations should of course be about delivering results – what results should be expected, not just financial results but other dimensions such as geographic footprint, category leadership, new ways of customer engagement, and/or establishment of new economic models. And how are they to measure the business outcomes they seek – in terms of inputs (resource view), throughputs (productivity view) and outputs (results view) of the innovation system.
They need to be able to describe the future state of the organisation itself: what should the organisation look and feel like in real terms, to deliver the chosen innovation scope? And how will transitions from the current state to the future state be achieved and what are the gaps that must be closed to develop the cultural and organizational capacity to innovate.
Identifying barriers and enablers for innovation helps in understanding what to amplify, leverage or overcome. Often, the most critical barriers are not tangible processes or resource constraints, but embedded beliefs about how the business should operate. These beliefs in turn influence so much of how the organisation operates.
Finally, the aim is to build a day-by-day plan of the required activities including how progress will be monitored and managed. Equally important is that the senior people in the organization have participated in the dialogue, have a shared vision of success for the “why” of innovation, and are far less likely simply to invest in the latest innovation “flavor of the month.”
In a disruptive world, you might of course well want to play wild games, but disciplined thinking always has its place.