Why In-Company Incubators Aren't Working… Yet (Part 1)

(Part 1 of 3)

I recently had an interesting talk with the head of marketing of a global travel company, and he mentioned that they had their challenges in becoming innovative (not unusual), and that they've recently revived their incubator, even though it didn't work in the past. They have been grappling with the question of whether innovation should be segregated into a small, focused team, or whether they should try to make the entire organization innovative.

To me, that's the wrong question. A truly innovative company leverages both, and how much the innovation process should be sheltered from the rest of the organization -- so they can stay focused on making current products and services more efficient -- depends on the phase of innovation.

Innovation, whether you're a startup or a Fortune 500 company, usually happens in three phases, and there are distinct key factors in each of these phases that contribute to success. To skip over or try to combine these phases often leads to missed expectations, organizational turmoil and wasted investment -- things you generally want to avoid when finding your next big thing.

This week I'm offering a three-part blog series on these phases.  Let's focus today on the first step, which is Ideation. When people think of innovation, they often just think about coming up with the great ideas. And, yes, ideas are the first step toward innovation. But ideation involves the way in which you gather and welcome the ideas.  Innovative ideas can come from anywhere in the organization and, more importantly, from folks up and down the food chain. It is no longer the domain of a small number of experts ensconced in an ivory tower -- nor should it ever have been.

With technology today (Internet, social, Web, etc.), information -- communication -- flows in and out of the organization at all levels, not just at specific points. When you tell that to executives today, that scares them, because it makes it that much harder to control the message. Marketing's job can no longer be focused outward, but also must be directed inward to the rank-and-file to ensure consistency and alignment. Apple's current "Designed by Apple in California" campaign (see these two commercials on YouTube) is exactly that. However, that topic is a whole blog post on its own.

On the flip side of information leaking out at all levels, information also flows into the organization at many more points than before. Innovative ideas can be sparked by a customer service rep's interaction with a disgruntled customer, an engineer's desire for more efficiency, or even a junior professional services consultant onsite on a client. All of these interactions can lead to insights that could drive innovation.

Innovative organizations today understand that and harness it effectively. Many organizations have experimented with innovation challenges, hackathons and other forms of crowdsourcing with varying success. Doing it successfully requires a number of factors to consider, ranging from executive sponsorship to how to define the problem to solve. One of us here at Differentiation@Work would be happy to go into more detail on how we help clients with social problem solving, if you're interested.

In the end, it shouldn't be the job of a small group of people -- whether they are executives at an offsite or a select group of technologists in an incubator -- to be your organization's only source of ideas. I do want to emphasize that we are not disparaging the abilities of experts to come up with great, innovative ideas -- far from it. What organizations should be doing is complementing the current innovation conjuring with sourcing concepts and ideas from everyone else in their organization.

It's all about creating more strong strategic options to consider.