We brought together a group of 20 senior innovation, product, and strategy executives in Manhattan, in collaboration with our partner Mindjet. The goal: to discuss how to create sustainable innovation programs that deliver results.
James Gardner, Chief Technology Officer at Mindjet’s Spigit division, and Scott Kirsner, Editor of InnoLead, led the conversation. To promote total openness, we told the participants we’d leave their names and companies off the record. But they hailed from multi-billion-dollar media, insurance, chemical, healthcare, technology, and retail companies based around the U.S. — along with one large law firm, and one stock exchange.
We’ve summarized the 20 most useful and interesting pieces of advice below.
- Innovation can be squelched by excessive process. “It’s almost like we take a very dynamic topic, innovation, and then we bound it into a very un-dynamic process and then expect it to succeed. You have to keep reinventing or you should just go extinct.”
- Participants talked about putting on “innovation theater,” versus building business value. “We have two things going on in the innovation world. One is what I like to call the innovation theater, which is really all about going to the show. You do events, it’s all the different idea boxes and all that. At the end of the day, people can stay home and not go to buy the tickets, and after a while they start doing that.”
- “You have to be position yourself as equal, and earn that position, as opposed to being seen as just a free resource available to the business units.”
- Send your team out to speak at conferences that your company’s customers attend, and share their vision of the future. When clients find your ideas and your pilot projects interesting, they talk to others in your organization — potentially salespeople — and ask when it’ll be available. “It’s amazing what revenue can do. The idea that clients are asking for these things really helps to actually get people to pay attention. It tends to work pretty well when you can go in and say, ;This guy is giving us $100 million in business a year, and he really thinks we should do this.’ Executives say, ‘I think we should do that, too.'”
- “If you have a champion, it can’t just be one. Especially if it’s a business unit leader who is dealing with the everyday operations of a business. Innovation is usually the first thing [they] are going to cut” when times get tough, one participant said. Another added, “We jump around and find different executive champions [from] year to year. We actually tap all of them and position strategic challenges from each part of the business for the company to respond to. That way, when one executive leaves or moves or inevitably there’s a strategy shift, you can always just go to the next one on the totem pole.”
- Getting credit for your work matters. James Gardner said, “One of the things we observe in our data [about] programs that are cancelled for loss of budget is that quite often what has happened is the innovation team has done wonderful work collecting, corralling, and getting things done. But the business line takes the credit for the innovation when it is delivered.”
- Other participants echoed that issue, saying that it shouldn’t be your goal “to parade around the effectiveness of the innovation program,” but that you should keep track of the conversations, research, prototyping, market tests, and other activities that have helped the company chalk up wins.
- Several innovation executives told us that they teach courses in their companies’ leadership development programs as a way to get colleagues familiar with the language, tools, and processes around innovation, and turn at least some of them into supporters of the innovation program. Others said they present or “pitch” their programs to cohorts of incoming interns, some of whom may raise their hands to help out with innovation team projects during their tenure.
- Should an innovation initiative even aspire to be sustained over time? One participant questioned that. “To me, in an innovation team, you innovate for the first six to nine months and after that you just become part of the corporate bureaucracy. Is sustainability even a goal? Or should it be fast and furious, come out with three or four ideas and then die. It’s creative destruction. The next guy will come along and sponsor the next project.”
- “You always have to have a bit of a paranoid approach to it, because if you’re not reinventing what you’re doing to be relevant to the current business situation, you’re at risk, and situations change. You’re always at risk. I see a lot of programs seem to get locked into a consultant-led model, and they just keep following the model and they ignore the signals around them that things are changing.”
- Innovation execs say they are looking for new kinds of financial incentives for their teams. One participant suggested, “We need to have options — like restricted stock units or something else — that vest based on how a business unit picks up an idea, or how it gets capital funded. You’re now you’re on the hook to give it to the business unit, get it funded, and go on. It may vest over three years, based on how it gets funded in the business unit, and how it’s scaled. Now you have an incentive to pass it on. Our HR people asked ‘Are we talking about dinner money? Are we talking about car money or house money?’ I think it’s more like car money, not necessarily house money, but it could go to house money if it’s a big, huge project, and it’s vested over two or three years. Without those kind of incentives, it’s very hard to get the [talent] you want to bring in-house while competing against startups. We did it because we just needed to. We couldn’t get the resources without it.”
- When innovation teams solicit ideas and input from throughout the company, they can develop valuable databases — especially an understanding of who knows about particular problem areas or technologies. That can be useful, one participant pointed out, if the company is considering investing in or acquiring a startup. Those topical or market experts can have input into whether it makes sense to buy the company — or develop a solution internally.
- On crowdsourcing: “We don’t have an idea problem, we have an execution problem. The way that we have solved for a little bit of the execution problem is we’ve used the crowd to validate our assumptions…to validate if we’re the right path. If not, we pivot, and at least at the end of the day we have a business case that is not a bunch of guesses on a piece of paper, but actually credible data.” This participant said they’ve been focused on “really moving the crowd from the front end of ideation to the validation of the assumption.”
- Where some companies said they have failed in crowdsourcing “is that we haven’t been able to frame the challenges well enough. We don’t know how to ask the right questions, [and sometimes the challenge sponsors in the business units] don’t care, they just want to get it out to everybody, ask a broad question and we don’t do anything with them. It’s just a terrible result.”
- Another participant said it was important to sit challenge sponsors down, “duct tape them to a chair,” and force them to spend an hour or two to craft a few sentences defining the challenge they want people to focus on.
- If you know how to look, one participant “you can find the three guys who have been bootstrapping something that has really helped their team a lot. Find these guys and then elevate what they are doing, or put resources behind what they are doing, and bring in some more people.” Another participant added, “When I joined [the company,] my first mission was to identify those fifteen or twenty people across the enterprise who had that [innovation] DNA. …We’ve had an abundance of ideas just on the basis of networking those folks.”
- Who are those people? Often, they develop a reputation in their groups as the pain-in-the-ass, one participant said, because “they never go away, they are incredibly passionate. You kind of have to think about what are the attributes of that personality, then go around to the leaders in the company and ask, ‘Who in your organization behaves this way?'”
- A big challenge was creating time for people to innovate — if not Google’s legendary “20 percent time,” then at least a day here or a week there. One company discussed a concept called LabWeek, geared to its engineering and product development groups. “We do about four LabWeeks per year, so one every quarter. Anybody can come in and pitch an idea. We end up getting twenty to forty ideas a week. That week you can go work on an idea, other people can join you…and on Friday it’s not a fully-functioning product, but they come and do some really cool stuff. I would probably say that 10 percent of those have gone into implementation. Not all of them, but it gives people an audience, and take them out of work for about a week.”
- Sometimes, to chase new markets, a separate skunkworks group is necessary — one “that isn’t bothered or isn’t trying to cater to the rest of the business.” Often, it needs its own infrastructure, or some amount of leeway from compliance and legal teams. “The one mandate we had was to go after a customer group we’re not touching today,” said one exec who’d created a skunkworks to launch new businesses.
- Good innovation teams always have sort of a “Winston Wolfe” element to them. Remember him? He was the “fixer,” played by Harvey Keitel, who showed up in “Pulp Fiction” to take care of a messy crime scene. “Innovation teams solve problems, and they help solve them very, very quickly. They’ve got a good toolset to make it go away and get a good result.”
- “We talked earlier about finding entrepreneurs inside your company, people who are really aggressive, doing interesting things. For a while, I was tracking a smaller group of people like that in my company. Nearly all of them have left the company.” Several participants questioned whether their company culture can change fast enough to not lose those people. Are there creative ways to retain them, establishing what one participant called “micro-climates” of flexibility and entrepreneurship in the larger organization?
- One company said it had a self-organized team called “We’ll Find a Way,” which chooses its own manager. As manager, “you get in and your job is not to make the decisions on what they work on. It is to figure out how to take the barriers away for them to go faster.”
- At one financial services company, the Chief Innovation Officer says they’ve “spent four years…basically re-plumbing the communications infrastructure in the firm. Pushing away from email and towards very, very flexible social systems.” That allows creative people with ideas and motivation to find each other. “A lot of times they just find each other, even if they’re not in the same business units. We’ve seen a lot of surreptitious communication activity taking place between those folks. That helps. It doesn’t ameliorate the problem.”
- Trying to develop a new business model inside a large organization is not a one- or two-year endeavor. “This is a decade-long journey,” one participant from the financial services industry said. “I have no idea if we will succeed or fail. I have no idea if [the CEO and board are] going to cut us off halfway there, but it gets really expensive, because by year two, which is now, we have to go scale things, and it goes from $1 million a year to $5, to $25, to $100 million.”
- On handing projects over to a business unit for roll-out: “Innovators are really good at transitioning and giving the baby to somebody else. The baby is going to have a great life — but you have give up the baby. The business unit will have more money to scale the business.”