Putting the Lie to Corporate Innovation

I used to work for a guy who made a ton of money convincing corporate executives that every employee could and should be innovating every day.

While I have great respect even now for the man, I’ve come to believe that this is pure innovation snake oil.

But snake oil or not, it has become a popular idea. Today, CEOs and senior execs are calling for everyone to be “corporate entrepreneurs,” trying to promote a culture of “ubiquitous innovation.” They are creating venture competitions sans the only prize a true entrepreneur would want, equity. And they are launching innovation awards, not realizing that innovators don’t want awards — they want investment.

When a corporate executive talks about innovation, what they are really saying is that they want a lot of happy, excited employees feeling empowered to radically improve their current line of business. And that’s ok. Most days, especially if the business is still growing, you don’t want every employee spending 9 to 5 trying to create new lines of business.

That’s what innovation is — paradigm shift. In other words, innovators (entrepreneurs in particular) are focused on doing something different, not doing the same thing differently. There is no such thing as “incremental innovation,” a term famously coined by Clayton Christensen. No. Innovation is binary: You either pivot your conception of what the company is, or you don’t. Anything else is improvement, even radical improvement. Sadly, improvement isn’t as exciting to talk about. It should be.

Ray Kurzweil: Innovation = Paradigm shift.

This is not to say that we don’t need innovators or that there is no place for entrepreneurship in the enterprise. There is room … just not as much as innovation enthusiasts would have you believe.

In my experience, about one half of one percent of any large group of people are, on any given day, ready and able to start “something completely different.” That might sound elitist, but think about it: on any given day, the innovator could be anyone … just not everyone. And it could be an entirely different set of people the next day.

What companies need is a path for true entrepreneurs to follow and a new set of management practices to govern them. Innovators are like scouts, not pioneers. Most companies know how to manage pioneers. The pioneer circles wagons, builds the saloon, hires the sheriff, and defends territory. The pioneer is the lucky one that gets the town named after them. Enterprises are actually pretty good at this. At IBM, both the Watson and Cloud Computing Divisions are pioneer towns. Boom Towns, in fact!

But the innovative entrepreneur isn’t comfortable in the boom town. They want a canoe, a dog, and a few trusty friends to head back into the wilderness … probably to be eaten by a bear and forgotten by history. That’s a scout. And enterprises are terrible at giving even a canoe’s worth of support to scouts, at least not without repossessing the canoe mid-journey.

At IBM, we have a special path for technology scouts. One starts as an Senior Technical Staff Member, graduating to Distinguished Engineer, and finally to Fellow. There are only about 100 fellows. This works well as an advancement path for technical people who should stay focused on tech and not move into pure management. But a technology scout without a business scout (a.k.a. entrepreneur) is like having Lewis without Clarke.

So I propose that companies that truly want to support entrepreneurs and promote a culture of innovation — and maybe keep a few more founders of companies they acquire after the handcuffs come off — build a career pathway and management framework for entrepreneurs, just as companies like IBM have done for technical leaders. It’s not for everyone, but anyone can follow the path.