3 dimensions for building efficient “corporate innovation
The basics for systematically building successful corporate innovation
Strategically relevant innovations need systematic innovation management! Before everyone starts using the latest methods, it is worthwhile to internalize the most important dimensions of successful corporate innovation.
Whether technologies, competition, strategy or new customer needs: The impulses to want to innovate can be manifold. But the impulse is not enough, because in addition to day-to-day business, it is difficult to find innovations such as new, suitable products, business models or processes “just like that”.
It is therefore worthwhile to approach innovations in the same way as any other corporate task, as planned and targeted as possible – this is what we then call “corporate innovation”.
This has undergone many transformations over the past decades. But even if the holy grail has not yet been found, we are at a point where corporate innovation capabilities can be systematically built up within the company. Because even if all employees can have ideas to improve their area or to design new offers for customer requests: Strategically relevant innovations need systematic innovation management! If the exploitation of new opportunities is based as precisely as possible on the company in order to use its strengths and to observe restrictions, we speak of “efficient” corporate innovation (as opposed to meaningless “innovation theater”).
Before everyone starts using the latest methods, it is worthwhile to internalize the most important dimensions of successful corporate innovation:
1. Mindset & culture
It is often said that innovation (just like “digitalization”) in a company is only possible if the entire corporate culture changes. However, waiting for this or relying on it is self-deception: innovation must be able to succeed in every company! (after all, every company originates from an innovation or entrepreneurial idea). So instead of blaming lack of innovation on the culture (and thus per se on the employees), corporate innovation should be integrated into the company in such a way that it becomes a strategic corporate function. This is because as soon as it helps the company by providing clear business benefits, it will automatically be relevant to every employee and integrated into the corporate culture accordingly.
So there is no large-scale change project for building the “right” mindset or culture change (even if consultants strangely prefer this). Instead, communication is the main focus: Here, it is necessary to convince the decision-relevant management levels & implementation-relevant employees of the necessity & meaningfulness of (efficient) corporate innovation. Impulse lectures, workshops & blended learning offers can help to make the topic and its role in daily business understandable for everyone. Everything else is then “learning on the job” as soon as corporate innovation is implemented.
2. Organization & Strategy
The corporate innovation function should be integrated into the company as a cross-sectional function, as its name suggests. If such a function does not yet exist, it is all the more important that it is implemented on the basis of a joint decision by the board or management. In this context, it is also advisable to designate a board member or managing director as a long-term “sponsor” for the topic. This ensures that corporate innovation is also given a high priority in the company in the long term.
After the decisions have been made, the concrete operational framework must also be set quickly. For example, it may be necessary to define general rules or options for cooperation with external parties (e.g., with regard to sharing information) for the required work with networks, to activate existing contacts of the company, and to generate channels for new contacts. In addition, there are processes for internal exchange within the company, e.g. via intranet, townhall meetings, regular updates, contact databases, project databases and similar collaboration measures.
In addition, timely planning of required resources is important as part of the company’s budget decisions. After all, separate budgets and resources for (strategic) innovations probably do not yet exist. And so care must be taken to involve the responsible planning bodies at an early stage.
For the “operation” of the innovation unit, budgets for personnel and premises are needed first. It must also be determined to what extent existing resources such as IT specialists, designers, financial experts, external partners, etc. can be integrated for conception and implementation. This would in turn have to be taken into account in the planning by the specialist departments concerned.
Within this framework, the dedicated unit for efficient corporate innovation can then be created. To this end, its precise remit and internal structure must first be defined, depending on existing resources and responsibilities. Since the unit must be set up (for the first time), a suitable head should first be identified or hired. This person can then appoint the appropriate employees to manage the individual innovation projects. In the best case, this person will already have some familiar people with whom he or she can work efficiently. As a rule, however, new employees have to be recruited (and trained). When putting together the team, particular attention must be paid to its dynamics for optimal collaboration.
3. Cooperation & Collaboration
The innovation unit requires as much flexibility as possible in terms of its working methods. A circumstance that is not easy to implement in the context of large companies, since work processes and work methods tend to be inflexible. This means that in the case of the innovation unit, an exception to the rule must generally be created. This is because the unit’s employees need a certain degree of freedom, e.g., with regard to the use and design of premises, working hours, home office arrangements, work materials or travel plans. This also includes, for example, allowing them to use new (virtual) tools for collaboration, even though the company has conflicting regulations regarding data protection and mandatory presence. A nice side effect: The innovation unit can serve not only for the development of efficient innovations, but also as a test lab for new ways of working at the same time.
In terms of specific individual competencies, it is important to find generalists with creative and analytical skills as employees for the innovation unit. This is particularly challenging if there are no similar profiles in the company yet. After all, this specific combination of competencies is rarely needed in companies with a specialized division of labor. As mentioned, when selecting employees, special attention should also be paid to their social skills. This is because a certain harmony of personalities in the team and sufficient psychological security are important for efficiently developing new ideas and innovations (since work is done in topics with high risk / high uncertainty).
In addition, the establishment of a separate identity and culture can be promoted in order to sustain the way of working and the social unity of the innovation unit. To this end, in addition to establishing independent and flexible work as well as open communication, events such as team evenings, excursions or joint breakout sessions away from the daily work routine must be actively promoted and encouraged.
With the right combination of building blocks, it is possible to create an efficient “innovation machine” within the company that is equipped to meet the ever-changing challenges. The exact composition and development depends, of course, on the respective starting situation and any existing corporate innovation capabilities in the company. Once these have been identified, we can begin to build or rebuild them – and then finalize them with the appropriate methods – more on this in the following articles.