Has Your Company Centralized Its Innovation Services?

May 11, 2018

In a recent Q&A email, a member of the InnoLead community asked the following question:

“My company has three different teams with competing approaches: a lean startup team, an agile team, and a design thinking team. We’re considering a single umbrella organization that would provide those services to the whole corporation. Has your company gone through such a centralization process? If so, would you be willing to share your experiences?”

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Advice from Respondents

Respondent in Financial Services 
“In complex and large organization, it’s common for management to pursue a top-down or a bottom-up solution. However, all the interesting action happens at the middle. Top-down provides permission, resources and cover for pursuing risky activities. Bottom-up taps into the entrepreneurial engine of the enterprise and where volume of ideas and passion comes from. How the enterprise manage when they come together in the middle becomes a crucial element of how innovation succeeds and advances in a complex organization.

…When done right, in my experience, innovation methodologies, such as agile, lean startup, design thinking focus innovator and management attention to this middle. So in harmonizing these approaches, the important thing is ensure that the merging of the top-down and bottom-up innovation activities will continue to thrive. While I have not harmonized these three particular approaches, I have harmonized, standardized and codified across multiple other approaches in different parts of the innovation process.”

Respondent in Banking  
“We use all three methodologies in the bank, and while people can be a bit dogmatic if they’re only versed in one of them, we find that it becomes more about when to use the right tools at the right time.”

Respondent in Health Care  
“In a prior company, we used Design For Six Sigma to harmonize between design thinking and lean. This is a well-documented process or system. The key here is the inclusion of the ‘fuzzy front end’ to ensure that best practices are used to elicit unmet customer needs and ensure you are developing the right product and the right cost.”

Respondent in the Technology Industry 
“An approach combining all those is desired. [I’ve] found that most comprehensive (transformational innovation) would involve HCD [human-centered design] combined with lean and executed in agile fashion.” He added that “for more sustaining innovation, you would do only lean. For simpler incremental innovations or new features, it is just agile.”

Respondent at a Consulting Firm
“At the moment we’re working with one of the largest chemical companies who have similar challenges that we’re helping to address. To be frank, most of our clients…will have this issue, since any large organization will have grown pockets of unevenly distributed innovation capabilities.”

He continues, “Most clients would design a unified approach and try to roll that out to replace what already exists. It is our experience that this will trigger significant resistance within the organization because units that already ‘do’ innovation do not feel heard or taken seriously. Often these rollout plans seem to be forced and the perceived signal to the organization is that they have been doing it all wrong so far. Not a good place to start.”

While the respondent says harmonizing is possible, he warns, “While the approaches are important, what is even more important is how well they are working within the culture of the enterprise. If an enterprise has three groups, I would take some time to understand which approach is more impactful and why. … Some approaches are optimized for generating ideas, some on reshaping the ideas to value drivers and some for ensuring that work happens at a quick pace. Such understanding helps design the harmonized organization to be complementary and collaborative with each other rather than competing.”