What Limits Innovation in Established Companies

by Jeffrey Phillips

What Limits Innovation in Established CompaniesSometimes, as an artist or writer you have a great idea and you have the chance to be part of the creation. Sometimes you’ll find that others have beaten you to the idea, and your job is to extend the idea, improve it and make others aware of the original contribution and your offerings.

Some days I’m a creator. Some days, today for instance, I’m publicizing Gary Hamel’s recent post in the Wall Street Journal about Innovation. Not that Gary needs a significant amount of assistance with publicity, but when someone gets it right, we need to point it out. Not with a flashlight but with a search light so everyone can see.

Gary started his post poking fun of some of the innovation lists – which firms are the “most innovative”. As he notes this is like comparing dancers – which is “best” – ballerinas or people who dance the tango? Square dancers or break dancing? Are we talking about classical interpretations or best new introduction? Sometimes I think this is akin to the arguments about how many angels can dance on the head of a pin. Anyway, the real value of Gary’s piece lays hidden over two thirds of the way down, when he starts talking about what limits innovation in established companies. He says:

  • Few, if any, employees have been trained as business innovators
  • Few employees have access to the sort of customer and industry insights that can help spur innovation
  • Would be innovators face a bureaucratic gauntlet that makes it difficult for them to get the time and resources they need to test their ideas
  • Line managers aren’t held accountable for mentoring new business initiatives or lack explicit innovation goals
  • Innovation performance isn’t directly tied to top management compensation
  • The metrics for tracking innovation (inputs, throughouts, outputs) are patchy and poorly constructed
  • There’s no commonly agreed-upon definition of innovation and no way to compare innovation across teams

These are his words, pulled from his post. The words I’ve highlighted with italics and bold and underlining (perhaps overkill) are the key ones. If I were to take Gary’s words and place them in order of sequence and significance, I’d say:

  • Define what innovation means and how it aligns to corporate goals and objectives
  • Establish an innovation strategy – Need Seeker, Market Reader or Technology Driver
  • Establish metrics and measurements for innovation
  • Incorporate innovation goals and measures into annual plans linked to evaluation and compensation
  • Train people throughout the organization on the tools and techniques of innovation
  • Establish a well-defined innovation process that all ideas follow
  • Encourage trend spotting and scenario planning as a way to gain insights

If you look at this list it seems daunting, and unreasonable if you want to create one new product or service. Yet the additional work to change the culture and make it more innovative, beyond the work necessary to simply grind out one new innovative product, is not that pronounced. Doing the least expecting the most is rarely a positive strategy. If you want to be truly innovative, plan to do more to get more.

But you know this already. The difference between creating innovative products and services and wanting to be more innovative is commitment.

Support the blog - Order your copy of 'Stoking Your Innovation Bonfire'

Don’t miss a post (2,050+) – Subscribe to our RSS feed and join our Continuous Innovation group!


Jeffrey PhillipsJeffrey Phillips is a senior leader at OVO Innovation. OVO works with large distributed organizations to build innovation teams, processes and capabilities. Jeffrey is the author of “Make us more Innovative”, and innovateonpurpose.blogspot.com.