Mechanisms to Breed Innovation in Big Companies

Mechanisms to Breed Innovation in Big Companies

By Alan Dormer

by Alan Dormer

Interpreting challenges differently

I have worked in a range of organizations, from high-tech start ups to large corporate companies and now a government affiliation. All of these organizations are interested in innovation, from the need to survive, the willingness to grow or the desire to just stay relevant. Natural selection deals with start-ups and small companies; those that don’t innovate will die. But what about large corporations and government? There are key differences:

  • They (believe they are) are too big to fail.

  • There is no clear line of sight between the task and the outcome.

  • Successes and failures are distributed across multiple departments, which leads to a socialized risk.

  • Stakeholders often have no choice but to continue support (this is particularly true for government agencies).

Rethinking innovative methods

The usual mechanisms for breeding innovation in big companies do not work. But if we accept that the market and survival mechanisms will not “breed” innovation, what are we to do? I certainly would not recommend following the trends of current thinking. Consider retracing your company’s steps:

  • Don’t create innovation metrics. Innovation is not a business process, and measuring it won’t result in more of it.

  • Don’t create an innovation culture. The idea behind innovation culture is falling in on itself. Maybe it’s me, but I don’t even know what an innovation culture is. Bean bags? Free pizza?

  • Don’t reward failure. No rational organization rewards failure. Whether intrinsic or extrinsic, these rewards encourage unhealthy psychological expectations and behavior.

There’s a better way. Based on what I have seen to work, here’s what I would do:

  • Focus on the desired outcome and create an internal supply chain towards it; create the link between the desired outcome and all employees.

  • Measure outcomes objectively and obsessively.

  • Reward people who are adventurous and audacious — those who accept a challenge — and they will do the rest.

  • Make experimentation part of  business as usual.

The other driver of innovation is necessity. We have to clearly communicate goals that stretch but do not overawe. My favorite definition of leadership is getting people to do something they didn’t think they were capable of doing. Put that together with the items above, and I think we have a good start.

We may never get the same buzz in a large corporation or government agency as in a start-up or small company. But we have to accept that different careers are attractive to different sorts of people. Regardless of company size, there is no reason why we cannot use innovation as a creative driver of cost reduction, service improvement and revenue growth.


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