At Julhiet Sterwen, we have noticed major corporations launching an increasing number of innovation initiatives in recent years: labs, corporate venture funds, partnerships with incubators, intrapreneurship programs, hackathons, start-up studios and more. We have also noticed their disappointment with the results.
Why is this?
Innovation strategy and ambition
Innovation must be driven by visionary leaders. Yet most organizations have not formally defined and prioritized the innovation challenges they want to solve in the coming years. Without doing so, they can generate numerous proofs of concept without making any impact.
What’s the solution?
Taking a different approach to the strategic plan
Clearly stating the innovation topics
Setting concrete targets on the new businesses to invent
Innovation and objectives
In the face of ever faster disruption cycles, three distinct issues appear, related to distinct types of innovation:
Inventing future businesses with innovation and disruption
Updating existing models with incremental innovation
Bringing an entrepreneurial spirit to the company through cultural transformation
One common error is forgetting that these three objectives involve very different approaches and resources.
Innovation and transformation (digital)
Often there is confusion between “disruptive innovation” and “transformation,” particularly digital. To be successful, these require fundamentally different mindsets, governance and resources: disruptive innovation means inventing the future, while transformation means modernizing the present.
The success of an innovation is not measured by the ability to generate proofs of concept with no future but by scaling up an idea to create impact. This requires preparation well in advance, setting up a suitable environment in terms of methodology, people, technology and organization.
Performance requirements and indicators
A lack of innovation strategy or objective targets leads to unclear governance and systematically disappointing value creation. Often, companies measure the effort invested in innovation (R&D budget, full-time employees allocated to projects, corporate venture funds, etc.) to the detriment of results, although it is possible to measure them!