Evolution of the Innovation Funnel

by Jeffrey Phillips

Evolution of the Innovation FunnelToday I want to examine a tool that has become a well-worn crutch for many firms, the innovation “funnel”. I’m going to argue that we need to rethink the funnel in fundamental new ways if we are to achieve our innovation goals.

First, let’s get into the mood by recognizing what many people think about an innovation funnel, using a cartoon from Tom Fishburne.

Many times a funnel is simply a place to collect ideas, ignore them or hope they’ll go away.

Remember that we innovators borrowed the idea of a funnel from the sales guys. The analogies are fairly close however – you need many prospects to qualify to close a deal, and many ideas to evaluate to create a new product or service. The first iterations of innovation funnels were simply that – a way to collect internally generated ideas and manage them through the innovation process to create new products.

Henry Chesbrough changed the concept of a funnel by making it permeable and porous. With Open Innovation he argued that ideas could and should come from internal individuals and teams AND external customers and partners. Further, ideas might enter the funnel from the outside and ideas may exit to third parties as well. Here’s a graphic that depicts the innovation funnel in an open innovation setting:

Open Innovation Funnel

However, the funnel still seems too focused on ideas. Our suggested revision to the funnel is outlined below. This next iteration of the funnel incorporates opportunities, ideas, technologies and even products, considering “spin in” and “spin out”. Ultimately the funnel is a bridge between unmet customer needs and the solutions we offer. The funnel should consider far more than just ideas. After all, in an open innovation model, we can accept and exchange ideas, technologies or even products that may address a customer need or emerging opportunity. Limiting the funnel to ideas reduces its capability and power and creates a very limited metaphor for innovation teams.

Innovation Funnel Jeffrey Phillips

You can see a PowerPoint that provides more detail about our thinking below:


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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.

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