Back in 2017, I wrote a blog post titled “Why every Corporate CEO should care deeply about innovation.” In that post, I describe a journey that we had witnessed corporates embark on as they try to innovate faster and better, thinking and acting differently in a changing world.
I also describe how, back then, most forward thinking corporations were at least experimenting with new methods of innovation, and I have since often spoken about this journey, and how it seemed to have some common threads or set milestones. These include corporates talking about being “more innovative”, appointing a head of innovation, generating innovative ideas, creating innovation labs, and so on.
Over the years however, our thinking at The Bakery has evolved, as we have done more and more work with some amazing corporates and entrepreneurs around the world. So today, rather than describing a journey, we think of a continuum of innovation along which all corporates sit and may be moving.
We hold the view that, ultimately, processes and tools of corporate innovation will become an inherent part of every senior manager’s role within large corporations. Just as these senior executives bear a level of responsibility for such things as people development, or governance, or health and safety within their department or division, they will have a responsibility and metrics put upon them to deliver innovation on an on-going, continuously improving basis. They may have an individual innovation budget or, possibly, be able to dip into or bid for funds from a central pot.
It may well be then that the role of any central innovation team is to define what the tools, approaches and key goals of the innovation strategy will be, how to measure success, how to train and equip executives with the new skills they need to achieve their goals, how to allocate funds, but ultimately it will fall to the senior managers to actually deliver corporate innovation.
And, for a variety of reasons, this feels right.
Firstly, how can any innovation team, no matter how large, conceive, manage and deliver all the innovation that large companies need in the fast moving and ever changing world we are in today?
Secondly, the heads of departments and divisions know best what is required, and should have the insight and experience to judge which innovations will drive the greatest returns.
Third, this approach will drastically reduce the typical corporate “tissue rejection” problem, if senior stakeholders are the ones driving and recognised for the innovation, there is a greater chance they will be able to remove obstacles and ensure successful implementation of great new ideas.
Back to the continuum.
If it’s true that all corporates already exist somewhere on a scale, it should be possible to describe and then plot various organisations’ position on it. We’ve compiled a questionnaire that generates a Corporate Innovation Profile, enabling you to see where on the continuum your organisation is. And of course, it’s quite possible that wherever you are is exactly where you want or need to be.
If we can gather lots of data, see where many companies are, and report, anonymously of course, but with various helpful stats, where everybody is, then we should be able to provide you with clear data showing how your business compares with other companies of similar size or in the same sector. You can complete your entry here:
People often ask us for examples of corporations who we believe are doing innovation well. The cop-out answer I normally give is that it’s really hard to say, as no one we’ve spoken to really agrees on what “good” looks like. I certainly don’t pretend to know all the answers, or that we’ve nailed it, or that we hold the panacea for all the corporate innovation dilemmas.
However, I sometimes point to two companies, one that most people haven’t heard of, which I should make clear is not a client of The Bakery, and another that many people know of, with whom we are in fact working on what we believe to be a ground breaking innovation strategy.
First off, YESBank is the 4th largest private sector bank in India. They’ve been innovating and collaborating with the startup ecosystem for over 12 years. They have a comprehensive strategy of partnering with, investing in, as well as starting and growing new businesses with both internal “intrapreneurs” and external entrepreneurs. Their innovation programme includes YES Fintech specially aimed, naturally enough, at financial technologies, YES Scale, a multi sector accelerator, and YES Institute for encouraging socio-economic growth and innovation.
Among many of the more recent innovations to be announced, YES MSME, a powerful digital solution to bolster financial operations of Medium and Small Scale Enterprises (MSMEs) in India. This particular example won global recognition at IFC’s Global Innovation Awards in Madrid in 2018, pretty unusual for an unknown bank from the subcontinent.
The thing that I notice when I review what they’re up to, is that it’s pretty prevailing across the business. Innovation has become a key part of the narrative of the company. Being recognised internationally is one thing, but recognising internal people for delivering improvement and making a difference is something else entirely. YESBank don’t manage this alone, they work with a whole series of partners on their different initiatives, and clearly have been thinking about how important a cohesive innovation strategy is to the whole direction of the company for many years.
Example number two is IMG ARENA Greenhouse, which is a ground-breaking new innovation programme we’re working on with IMG ARENA, part of the William Morris Endeavour Group of companies. The programme launched earlier this year after over a year of preparation. It’s a multi-layered, always on programme fuelled by business and industry challenges, fully integrated into the heart of the IMG ARENA business. As far as we are aware this is a unique programme to encourage both individual entrepreneurs and early stage businesses at many different stages to benefit from collaborating with one of the worlds leading sports and fan engagement companies, getting access to validated ideas, data, revenues, investment and exit opportunities.
Fast Company recently ranked Endeavor as one of the most innovative companies in the world, 2nd to The Walt Disney Company in the media sector, and picked IMG ARENA out for a particular mention.
Could your corporate achieve this kind of success and recognition, and what are some of the obstacles?
There are definitely learnings here for CEOs and innovation teams who want to make this kind of thing happen within their own organisations, but there are challenges: where to find the funding, getting buy-in and proving the short and medium term returns, legal, compliance and procurement are all issues to be managed.
For example, one major issue is how to gain consensus across the organisation. Large corporations are, by their very nature, divisionalised and siloed. Senior executives are strong-willed, don’t take kindly to being told what to do or how to spend their own budgets by centralised departments; especially when there’s little proof it’s driving the right returns.
And it’s worse if the experience to date has been less than effective.
“I know my business and I’m going to innovate the way I think best, I’ve been asking the digital and innovation team to help for years, and that’s achieved nothing of value to me; you should just get out of my way.”
The trouble with this independent approach, while at least it might end up getting some things done in individual departments, is that it creates innovation chaos. There is no cohesive strategy, collaboration or learnings across different parts of the business.
Separate teams in the business may end up working on similar challenges and come up with wildly different solutions that they each love, but which won’t integrate in the future. We’ve seen this happen time and again and it’s a retrograde step, causing frustration, delays and incurring unnecessary costs.
At The Bakery we’ve developed a complete methodology to help executives within any industry address and overcome these challenges. To successfully achieve an extensive culture of innovation, corporate cultural shifts and changes in thinking may be needed in areas such as tolerance of risk and attitude to failure, leading to more experimentation and greater breakthroughs.
Satya Nadella, CEO of Microsoft says “To me, that is perhaps the big culture change — recognising innovation and fostering its growth. It’s not going to come because of an org chart or the organisational boundaries. Most people have a very strong sense of organisational ownership, but I think what people have to own is an innovation agenda, and everything is shared in terms of the implementation.” I referenced this quote in 2017, and it’s still valid.
If you’d like to figure out where your organisation sits on the Corporate Innovation Continuum, why not get in touch or fill out the Corporate Innovation Profile on our website. You’ll get to see how your business compares with other similar corporations. We’d love to help you develop your innovation agenda, innovating with and like startups.