Include an Ecosystem in Your Innovation Strategy
Sean McCoy shares a blog post from his company website that presents a case for and against spending resources on ‘innovation’.
Innovation is hard. Most companies do not do it well. Long is the list of established market leaders that were The Disruptee instead of The Disrupter. But firms are not to blame. Most innovations fail period, regardless of who is doing the innovation. Innovation is a high-failure sport.
Nevertheless, conventional wisdom holds that large businesses should be more innovative. It’s even a famous imperative: Innovate or Die. But why should a firm that is organized around low-failure productivity embrace high-failure innovation? Why should a large company make innovation when it can buy innovation?
The argument against ‘Make it’
There are many reasons why a large firm making its own innovation might not make sense. Finance departments balk at the lost capital that could have been allocated to a known winner. HR departments can be reluctant to promote high-failure entrepreneurs, knowing how poorly that will be received by those that receive the opposite treatment for a string of failures. Audit, Compliance, Legal, and Quality Assurance departments usually do not take kindly to bug-y minimum viable products, nor to operators who move fast and break stuff.
Innovation at a big firm is equally difficult from the perspective of the innovator. The large number of stakeholders slows down decision-making. Once decisions are made, the work itself takes longer than entrepreneurs would like, because a company’s processes involve many hands, and innovators want speed.
Points covered in this article include:
- Making innovation
- Buying innovation
- Leveraging an ecosystem
Read the full post, Should your innovation strategy leverage an ecosystem?, on the McCoy Consulting Group website.