Can Large Companies Be Successful At Innovation? S13 Ep3

Yes! Here are the six actions they need to take

I came across a recent article where the Managing Director of Accenture Digital made the bold claim that large companies cannot do innovation. More accurately, Narry Singh said, “.. Corporate innovation does not work.” He goes on to claim that innovation at large companies do not work because “.. the firms are too slow to move – to change their work practices.” Do you think  large companies can be successful at innovation?

His answer to this challenge? Work with start-ups. Sounds like a once-size-fits-all type of strategy.

I flat out disagree.

I created and ran the Innovation Program Office (IPO) at HP for 8 years where that team launched +20 new products across HP's global footprint.

Large companies can be successful at innovation with the right structure, the right culture and an understanding of how to apply to laws of innovation to them.

Here are the first six (6) steps large companies should take to be successful at innovation.

Step 1: Innovation Team Leadership

The innovation team needs a leader and you need to find that person. Some will say that you should go outside. I would encourage you to look internally first. In my experience, you have someone in the organization who can be a great leader. They are just hidden in large organizations.

Step 2: Recruit The Innovation Team

Be on the look out for people to join the team. I look for passion. I can teach the business and technical skills but I cannot teach passion. But not just passion — but passion that is executed upon. Taking recruiting for the innovation team seriously. Its the difference between success and failure.

RELATED:   9 Characteristics of Successful Innovation Leaders

Step 3: Innovation Governance

Be careful how you setup governance around project approval. Innovation anti-bodies will come out in droves if they think they can control the effort by being part of the approval process. In my current role as a CEO, I use governance as a way to grant approval rather than a way to exert control. For example, every employee no matter your role gets $1,000/year to work on an idea. Each team in the organization can spend up to $50,000/year on idea(s) without needing approval. The innovation leaders can approve work on any idea up to $250,000 without needing leadership/executive approval.

Step 4: Go Outside For Ideas

All organizations big and small need to recognize that they are not the only source for great ideas. Great innovation teams go outside to find ideas that they can use as a spark for new products and services. Some outside sources for ideas include: University research, co-innovation, startup/vc's, ecosystem innovation and government funded grants.

Step 5: Stay Stealth

Once you have your innovation team is up and moving, stay hidden – go stealth. Innovation antibodies can't attack what they don't see. The hardest part of managing a high performing team is to get the team to not talk about the great work they are doing.  Everyone likes to get recognition and credit for the work they do. You can't stay stealth forever — but be deliberate when you crack open the door and let others see what you are doing.

RELATED:   Interview with Dan Prosser

Step 6: Create a New Funding Model For Innovation

Typical company funding model is built around the annual budget cycle.  That's fine for the normal operations of a business but innovation doesn't operate on an annual time frame. To enable innovation, you need to create a funding approach that is not contained to budget approval activities. How to get this in place? Recruit your CFO to be part of the solution.

This list of the six steps should get any organization started but there is more if you want to grow your innovation capabilities across the organization. Check out some other shows and blog posts where I talk about how to enable your teams to create game-changing innovations.

Show Links:

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2 thoughts on “Can Large Companies Be Successful At Innovation? S13 Ep3

  1. Respectfully, what you’ve largely described is creating a start-up in a large organization; which is somewhat parallel to Accenture’s advise. A large corporation must already have a culture that allows for start-ups or the antibodies will require the new group to spend one third of its energy building slide decks and having meetings to justify its existence or purpose. If the antibodies don’t kill the group, they will certainly cool the passion, wound the visionaries and shorten the leap of the innovation.

    If a company does start an Innovation group, move it away from the mother ship and let it fully bake their ideas and get customers independently. Don’t move it into big corporate until it’s at least close to self-sustainability