Innovation is often seen as abstract and people think innovation as just invention. And all of the best innovation people so happened work for another company? Hmmmm. Innovative people are hard to find? Majority of managers think innovation as new products. For the tech guys, innovation means bringing the next version to the market. For consumer goods companies, it means plenty of brand extensions to flood the shelves.
Whose jobs is that? Unless you have an innovation group that has the expertise. A lot of organizations think they can do it themselves. Put some people together and get an outside facilitator and let's brain storms. This is the most common approach to innovation. Usually when a company accepts that innovation is needed (because the stock price has dropped 30% or disruptive competitors are eating its lunch) there is generally a sense of collective embarrassment, and a groupthink quickly sets in that says "we got ourselves into this, we have lots of smart minds here, we have so much experience in our industries and we can get ourselves out of it". Often by the time they realize they need help, the situation was much harder to recover.
Executives from top tech companies including HP, eBay, Microsoft and others attended the first Corporate Innovation and Research Fair last week in SF to talk about their own innovation stories and techniques for staying innovative. The common theme is it's not easy to innovate, considering that large corporate cultures can be the biggest barrier to innovation. Let’s face it, if corporation are good at innovation, all VCs will be out of business. That’s the beauty of our capital systems, VCs are the most important player in the innovation eco-systems. It is not just money, it is the ability to see beyond today and bet on bold businesses. Unfortunately the concept has not extended far beyond tech (IT, biotech, nano, clean energy, material etc.) although we are seeing some focusing on social innovation.
The HP guy Rich Friedrich made a good point (although nothing new) about demands from Wall Street can stifle innovation. Similarly, He said that one of his company's strategies is to partner with outsiders on projects. Here’s the most interesting truth, "All of the innovative people don't work for your company," he said. But once a technology is ready, transferring it to a product group or bringing it to market can be highly difficult, he said. That's why so-called technology transfers are "a contact sport," he said. Researchers must travel a lot to get new ideas and prototypes in front of the right people, according to Levin.
So what are the preconditions for innovation in large corporation settings? The biggest challenge is bandwidth. No one has spare bandwidth today. Managers today work harder than anytime the past 20 years and communications and meetings alone are taking up a large chunk of managerial time and. energy. We also know the Google’s approach of 20% playtime for their engineers. A lot of discussions I have with my clients are around how an organization should allocate extra bandwidth.
My experience is that only top management can create this luxury (or necessity) when they have a particularly project to pursue. We are currently helping a large global entity to integrate our innovation process into theirs. This way, it becomes legitimate and people’s time spent on innovation will be seen as official. There's a lot of myth about innovation consulting. There's often a perception that how consultants would be arrogant enough to presume they could find a way to reinvent or radically transform organizations? It might seems frightening to open your kimono to admit your challenges in the first place. That's a barrier for many organizations to accept that there's a need in the first place.
Our clients are very comfortable with the idea of outside help and like our entrepreneurial, fast moving, agile work cultures where our inter-disciplinary thinkers enjoy close-knit relationships with like-minded clients. That's a fun process.
Off to London tomorrow.
