[#innovation - 01] how to inject some innovation into an elephant

It’s a sort of history repeating. In times of economic malaise, many corporations finally decide to think of their future and invest in strategic experiments on innovation [1]. And this is even truer for companies competing in ‘red ocean’ markets.

The challenge, as usual, is on how to install an effective innovation process into a company which has established mechanisms set up since long to support a main stream business, spending as few resources as possible of course.

How to rapidly overcome the cultural opposition of sceptical managers and colleagues upon the opportunity, better, the need to provide the company with a process which is able to structurally gather valuable ideas and transform them into competitive value?

How to rapidly design and deploy a process able to provide concrete results in short time?

What type of competence needs to be involved?

Relying on external consultancy might give you the tricky confidence that will facilitate quick results in a field where you still have not gained enough experience. But completely relying on external consultancy will also expose your company to awkwardly adapt to theoretical and very elegant academic models that very little have in common with your company’s culture and mechanisms or with its realistic investments capacity. This might turn very expensive and actually frustrate the fulfilment of your honest, managerial evolutionary vision.

So, apart from the usual prescriptions having been suggested by modern literature and industrial experience on innovation during the past ten years (such as. strong commitment by the top management, opening [2] to external contributions, creating dedicated cross-competence groups, etc), what can really make it work?

Well, just think about it, what kind of venture is pretty similar to the one I’m talking about?

• Little money to invest, many constraints, few resources
• Uncertain targets, uncertain results
• Strong inertia to change in the target market
• Little time available to provide results, possibly with short life cycles
• High possibility to fail
• Need for quickly learning
• Effectively communicate assumptions on possible return to gain credibility and the possibility to get funds for growth
• The main asset you can count on is people and their competence

Well, I’m talking about start-ups. The main difference between the start-up challenge and setting up an innovation function inside of an established company is about CHANGE. Professor James Belasco talks about “teaching the elephant to dance” [3]. Many recipes are available on the market. But, how can we make it in time of global crisis and resources shortage?

My idea is that, before starting to look for your source of change outside of your company (consultancy, openness, …), even if interesting and important in terms of opportunities, a more sustainable resource is your company itself. And I’m not talking about your R&D office. Your main asset is the people working for your company, mainly if yours is a service company. I think it’s the case to go through some progressive steps:

• Make a “Darwininan” selection of the people more motivated to make innovation experiments (creativity, enterpreunership, sensitiveness to customers’ needs, feasibility attitude, some awareness on economics).

You can do this by instituting an internal contest on innovation, a simple one (just ask to describe a value proposition and the target), meant to gather ideas (no restrictions on this: incremental and radical) and let them be considered by top management. Select the most valuable ones using FEASIBILITY as main criterion. Don’t forget to reward the people proposing the best projects; forgetting it would turn a boomerang in terms of engagement.

• Create a hub [4] involving the people Darwinianly (I mean those having demonstrated attitude to effectively experience change) selected on former step and honestly ask them to design the innovation process. Ask them to do it as if they were projecting the business model of a start-up, ask them to fill up a business model canvas. Then merge their visions and make a ‘manifesto’ out of it, to be shared with the whole company.

The mission of the hub will be to acknowledge the strategy of the company and, according to it, scan the company to identify the pain points.

The hub needs to become the listening point that might have birth inside of your company. The real innovation, for people, will be having other people available to listen to their ideas and give them help to communicate them effectively. The hub will be the team in charge of gathering any valuable idea through the internal communication channels that need to be properly set up.

• The hub will have to associate any draft idea in a proper pain-basket and then make a selection to promote those ideas being considered more feasible and coherent with strategy. The hub will also have to translate the drafts into a form more compatible with a more mature business analysis.

• After that, the selected business models will be proposed by the original submitter, supported by the hub, to a management steering committee that will make a second selection and will give the responsibility on feasibility and implementation to an internal manager, the one closest to the identified target. The original submitter has to be rewarded and possibly involved in the development.

This is a short and simple summary of a more general idea that would give the company many advantages (people engagement, capitalization of internal competence, creating a basket of ideas which might lead the company’s next growth strategy, for example). 

The goal of this short article is to start discussing about this vision, which is about injecting some entrepreneurial spirit in the elephant and just count on its latent, sometimes hidden, strengths.

DP 

---

[1] For example, have a look at ‘Strategic Innovation and the Science of Learning’ (Vijay Govindarajan, Chris Trimble), MIT SLOAN Management Review, 2004.

[2] http://en.wikipedia.org/wiki/Open_innovation

[3] http://www.belasco.com/elephant.htm

[4] Implementing radical innovation in mature firms: the role of hubs (Richard Leifer, Gina Colarelli O’Connor, Mark Rice), Academy of Management Executive, 2001.