10 Commandments of Corporate (Open) Innovation
At CREATORS, we work with wonderful corporations who are market leaders in their markets. They have amazing teams and talented individuals, endless resources and extensive market knowledge. Yet, they are failing at corporate innovation. They fear competition and disruption, they are afraid of the future, but at the same time they are afraid to take bold decisions and change their businesses overnight — which would be very unwise too! We believe that it doesn’t take a lot to do innovation better. Here a few rules companies can adopt instantly to get better at open innovation in no time!
Corporate Innovation Rules
1. Create corporate innovation based on best practices, not by copy-pasting competitors’ activities.
There are many great open innovation models out there, yet most companies copy-paste their competitors’ activities or employ international consultancies — struggling with innovation the same way as them! — to employ a generic innovation mechanism. In our experience, this strategy is far from perfect. First, take your challenges and goals, then your strengths, and build your unique program based on your uniqueness. Then, it will bring great results. And you’ll learn a great deal on the way.
2. Measure your efforts for short- and long-term success. And adjust as you go.
It cannot be emphasized enough how important it is to measure your innovation practices, especially since they are so difficult to measure. But before you start searching “innovation KPIs”, first look at your short- and long-term goals and attach KPIs based on these. Also, think about ways to show value out of a new process even if it fails — there are plenty of ways to take the innovation project learnings and build on them. But to do that, you need to know what you are trying to achieve through different activities.
3. Develop different projects for different innovation goals. Don’t expect one program to cover all the innovation needs.
One program cannot cater mature startups and early-stage ideas, internal innovators and business partnerships, innovation culture development and strategic investments… The experience tells us that it’s a good idea to create a few programs and see how much they can build on each other. The “matrix” structure works really well in creating the right innovation strategy model. Another option is a “pillar” structure (see the graphs below).
4. Don’t throw resources in all possible directions. Create focused innovation activities with minimal waste.
Some corporations feel they are so late to the innovation party that they have to start doing EVERYTHING, or at least invest in everything — all the buzzwords start to be their investment scope, regardless whether it’s in their strategic core business or completely outside.
There’s nothing wrong in trying to invest in many things and expanding vertically. However, the market shows that doing too many things in too many directions is a bad idea. It usually involves wasting remarkable amount of resources (big consulting firm budgets, investment budgets, expert consultant fees…) and usually does not bring expected results. It’s always a better idea to start from what your company knows best and take it from there.
5. The whole organization needs to be tasked with innovative activities and taught practical innovation tools.
Don’t “do innovation”, innovate in what you do — this is what your employees should be tasked with. Otherwise, they will always feel that innovation is someone else’s job and will not feel like participating. Every person’s job should be innovation, not only the innovation teams.
Empower your employees to feel an important part of the innovation processes. Even if they don’t have knowledge about innovation, they still know their job and challenges the best — and they can be a great resource for mentors, experts, challenge ideators. Having them on board and excited about innovation is the first and most important step in organizational change management.
6. Employees need a safe space to fail. They need to be encouraged to take responsibility and risks.
The best way to do it is to create a multidisciplinary team of experts. In this way, one person does not carry all the potential risk — so the group will have it easier to take bolder decisions — but at the same time there’s enough responsibility for all the group members to feel like it’s their project. An easier and a more digestible way to work with innovation projects.
7. Build on your strengths and Unique Value Proposition.
Each organization is different and should build on its strengths to lead its industry’s innovative activities. There’s a reason why you are a market leader — use your position to grow even more — in your business or vertically. Know your UVP and act accordingly.
8. Know where you are on the Corporate Innovation Maturity scale and adjust the necessary next steps to get to the next level.
Are you experienced in corporate innovation? Or rather you have just started actively discussing the topic within your organization? Whichever is the case, there are some best practices to take your organization from one level to another, and it’s best to learn from other what should be done before you start creating lavish (and expensive) innovation activities. We write more about Corporate Innovation Maturity HERE.
9. Treat every Proof of Concept as Success
Frame the innovation activities in the way that will show that trying is already a success –even if you decide not to implement a technology after a POC. After all, this also brought important know-how to the organization, regardless of the solution being implemented on a commercial basis. Treat all the pilot projects as an opportunity to test assumptions and learn. This way, there will be no failure attached to a specific project, because creating a trail is never a mistake.
10. Innovation Does Not Equal Technology
Innovation is a process of redefining and reshaping a category or a reality. It may be connected to corporate culture, organization’s structure, business model, existing products and needs, customers and yes — technology. But it does not equal new technology. The technology itself may be a fruit of an innovative process and it may be the goal of an innovative activity. But looking at the process of innovating in a narrow technology-centric way doesn’t make enough room for creative and diverse process, which is a key to any great innovation.