Innovation labs operating at the edge of a company, focusing solely on innovation and R&D were at the height of popularity just a year or so ago, but are now closing at an ever-increasing rate. These siloed, trendy workspaces, that have little contact with the rest of the business and operate more like startup incubators. They have proven themselves to be unsustainable. At best they were a short-term answer to the question “what are we doing about innovation?”. At worst they are a distraction from the crucial work of developing new business models, products and services.
At its most basic, innovation must address a customer need. This is where incumbents can prove their worth over the myriad of start-ups nipping at their heels. With a wealth of historical data and current customer reach at their fingertips, they can focus on commercially viable, customer-centric products, as well as working on the longer-term market-changing innovation. Using this “roofshots plus moonshots” approach to innovation has been used at companies such as Daimler and Google for many years. But the glamour of R&D has been mistakenly portrayed in the lone genius model, rather than a collaborative model. The truth is, many of the short-, to medium-term innovations a company will make are combinatorial in nature – they are created by combining existing products, services, data sets and software to create something new.
Genuine corporate innovation must also focus on transforming the company, as well as it’s products and services. This new role requires a different mindset, leadership model and structure from both the day-to-day work and innovating on products and services.
Here are five links that explore the future of innovation:
- An interesting look into why innovation labs are closing up shop.
- Helen Barrett explains why the there is no such persona as the lone genius in business.
- An FT report looks at how big tech companies are stifling innovation.
- How large firms can learn to avoid waste in innovation.
- Steve Blank on what drives innovation in large companies.