External Tactics to Deal with Innovation Budget Cuts
Your innovation budget has been axed. Pull up those bootstraps and turn to outside resources and inspiration to get the job done. In Part 1 of this series (found on Hypepotamus) we focused on internal innovation tactics to try when your budget goes the way of the Blackberry. Here’s a breakdown of external tactics that require more elbow grease than extravagance.
Partner with startups already solving your problem
Partner with startups to deliver on your core business innovation challenges. It’s cheaper to source a startup who already has a solution than it is to create a new solution your company doesn’t have the current capabilities to develop and scale. Also, hiring large agencies for multiple rounds of concepts and market testing before building anything is typically a much longer and more expensive path than becoming a customer of a startup.
Co-create with suppliers and partners using an intense 3-day format
Invite suppliers and customers to collaborate and develop ideas together. I’m not suggesting a brainstorming session, but a sandbox where people co-create — pitch ideas, form teams, validate ideas by engaging with real potential customers, build prototypes and run experiments. It’s cost effective and much more productive than a brainstorming session where you leave with a stack of unvalidated ideas. Additionally, relationships are strengthened and a deeper understanding for each other’s business and customers are clear.
We had a great experience with this at Coca-Cola. A brand team hosted a session to fill their innovation pipeline and invited customer teams, as well as partners like Google and Twitter, to work together for 3 days to build and validate ideas.
Host a hackathon in your local community
If you have a new technology or initiative and need to amplify it, hackathons are a great solution. There are many developer groups and organizations you can partner with to promote your hack, and you may choose to find partners to help cover the costs and operational burden of producing the event too. This is a useful tool to help you build out an expected budget.
Coca-Cola had this challenge themselves — they had hired agencies and suppliers to create solutions to the billion dollar problem of not knowing what’s in their coolers, but the solutions were too costly or didn’t work. They hosted the CoolerHack hackathon to tap into the community for a fraction of the cost and found a unique solution that’s currently in market testing. Coca-Cola also recognized the importance (and cost-effectiveness) of allowing the winning team to continue to develop the solution outside of Coca-Cola. Coca-Cola can simply become a customer when the technology is ready to launch — providing expertise along the way, but not paying for consulting fees or development costs.
If you’re really into DIY — here’s an ultimate external hackathon planning guide to get you going.
Empower entrepreneurs to innovate
If your objective is to develop adjacent business models to drive growth, an incubator for entrepreneurs with complementary domain expertise can be a cost-effective way to achieve this goal. Create a mechanism where you can share goals and collaborate with entrepreneurs who are building products in high growth areas related to your business. The entrepreneurs receive direct access to industry expertise and assets, while you deliver new products to market for less investment and risk.
This tactic is cost effective and gets more innovative ideas into your pipeline. Entrepreneurs have the freedom to operate outside of your company’s structure and to try things deemed too risky for the core business. Learn by observing their experiments while also helping promising ideas move faster. This is also a great way to explore more ideas than your budget would allow. Let’s say you have ten new product ideas and the budget to develop one. Since it’s unlikely you’ll pick a winner this early in the process, creating a portfolio of ideas using the entrepreneur incubator can give you more shots on goal for the same up-front investment.
Thanks for reading. If you haven’t read Part 1 yet, head to Hypepotamus for our list of low-budget internal innovation tactics. If you have any low or zero-budget tactics you’ve used to deliver innovation objectives, we’d love to interview you. Email carie@yourideasareterrible.com.
Originally published at Your Ideas Are Terrible.
