The Right Recipe for Innovation and Entrepreneurship? No Cookie Cutters to be Found

by Justin Jones

What’s the value of entrepreneurship and innovation to a large organization? It seems that many large, successful companies became large and successful by building on new and inspiring ideas and then by skillfully maximizing efficiency and minimizing risk and variability over time. In so doing, the echoes of founding entrepreneurial energy seem to fall silent. And as a result, our large companies find themselves ill-prepared for today’s volatile, fast-changing business environment.

To focus attention on this issue, Interaction Associates hosted thought leaders in entrepreneurship Len Schlesinger and Charlie Kiefer at a recent LeaderLens Forum in Boston. Len is the Baker Foundation Professor of Business Administration at the Harvard Business School where he teaches general management, and former President of Babson College, a world leader in entrepreneurial education. Charlie is the President of Innovation Associates, currently teaches at MIT, and has collaborated with Len on a number of publications, including their recent book, "Just Start."

At the Forum, which hosted industry leaders from the New England area, Len and Charlie shared that large organizations tend to be tragically under-prepared for innovation, and are often less-than-welcoming to those with an entrepreneurial mindset.  Both men believe fervently, however, that entrepreneurship is a core responsibility of the 21st century General Manager. In fact, Len has revived a General Management course at Harvard to communicate his research findings.

Interestingly, Len’s review of the literature on entrepreneurship and innovation does not offer any proven recipe for success. Len spoke of three leading theories: Clayton Christensen’s suggestion to spin off innovative endeavors in “Disruptive Innovation,” Michael Tushman’s theory that organizations should manage both their mainstream operation and disruptive ideas at the same time in “The Ambidextrous Organization,” and John Kotter’s hypothesis that innovation can be cultivated across organic networks in “Accelerate!” All of these premises are lacking in solid empirical evidence translatable to broadly applicable corporate strategies. In short, there’s no proven success formula for leaders to adopt.

Len’s and Charlie’s advice: You must experiment to learn the strategy that works for your organization. This is working well in a number of IA client organizations. Here are some success stories from which you might borrow.

  • A large national retailer with a strong history of innovation detected signs that innovation was beginning to flag. It sought ways to keep its entrepreneurial spirit alive. The leadership team leveraged a series of ½ day workshop sessions with between 20 and 130 leaders from across the organization to re-ignite their innovative spirit and ideate around specific cultural enablers with the aim to revive and keep innovation flourishing. This group has continued to hold general ideation sessions, and are implementing a number of ideas, including deploying an internal system for tracking new ideas across their U.S. stores. The company is also focused on developing internal innovation champions to whom project teams can turn for innovative insights on business issues.
  • A global computer manufacturer started an innovation track with its global procurement function because of its reach across the business. Leaders learned IDEO’s Design Thinking skills and were coached on important projects that, to date, have saved the company over $100 million.
  • A global chemical and pharma organization created an organic, open-enrollment program, forming more than 50 cross-divisional teams in IDEO’s Design Thinking. These teams then took on customer-facing projects. Many of their ideas are in the experimentation phase, while several have been fully implemented — including a fully revamped call center process that has transformed the customer experience. Early participants now are beginning to build innovation capabilities within their own functional teams to generate more novel solutions to immediate business problems.

Why are these approaches working? Are there any common themes or lessons to be found? Well, yes. Each of these organizations is leveraging a collaborative change framework. [see Figure 1.]

direction.jpg

           Figure 1: Direction, Commitment, Capability.

 

Let’s see how the change framework plays out in these innovation scenarios. In each instance, there is:

  1. Enough alignment among senior-level decision makers for people to take risks without fear of retribution. (Direction)
  2. A group of people participating who have—to a greater or lesser degree—raised their own hands. They, therefore, demonstrate the degree of Commitment needed to try new things that could potentially disrupt how people work. Finally and most importantly,
  3. Our clients are finding success by increasing their Capability. Their innovators are learning both Design Thinking and collaboration skills in order to demystify innovation and make it accessible, repeatable, and manageable as part of their general problem-solving toolkit.

As with many new ventures, certainly, other approaches may be feasible, too. Perhaps the most important step is this: to begin experimenting in your organization.

Learn more about our innovation expertise here.

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