Don analyzes why brilliant ideas fail in the marketplace: “Part of the problem is that design consultancies are outsiders, hired by one division of the company, but not necessarily accepted by the other divisions. A product, however, requires the support of the entire company: design and development, engineering and marketing, sales and service, supply chain and distribution chain.”
“Brilliant new ideas once laid out, prototyped, PowerPointed, memoed, and white-papered, still have to get accepted by the rest of the company, this is where the hard part begins, and external designers leave.”
Is it specific to external designers and business consultancies? “The same phenomenon holds for internally generated ideas from the research, planning, and strategy parts of the company.”
Is there a reason why? “Ideas are just the starting point toward product realization. New product ideas have to fit the competencies of the corporation. They have to fit within the existing family or products, or at least the product strategy. The purchasers of new products have to be prepared. The costs must be contained. The technology must be up to it. The same people who the new ideas are intended to supplant and go around are now responsible for executing the ideas. No wonder so many good ideas fail.”
Why Skunkworks are not the answer: “Skunkwork teams are like independent consultancies: they can do great work, but then they have the same trouble integrating their ideas with the needs, resources, talents, and political structure of the organization.”
Here is the paradox : “Creativity requires breaking out of the mold, distancing the team from the corporate structure. Successful products and services require acceptance and buy-in from the corporate structure.”
“Creative ideas are never sufficient. After the fun part of creativity comes the difficult, dull, painstaking efforts to make those ideas fit the true needs of the organization and the customers, to make sure they are practical, implementable, cost-efficient, and profitable.”
“Innovation only succeeds when all the stars are aligned. The company has to have complete buy-in.” “No product is an island: Great ideas are necessary, but not sufficient.”
In the rapid innovation thesis, I have pushed for a “skunk works” model.
Why? Because the assumption is to go fast, and insuffling innovation culture within the core company takes years, it also mobilizes a lot of resources within the company to achieve this transformation. It may not be the priority at the time. Though it is definitely the ultimate goal: the Skunkworks entity with its innovation approach will eventually contribute to it. As Ikujiro Nonaka puts it: “This strategy can act as an agent of change for the larger organization.”
Having said that, I am fully aware of the difficulty raised by Don about integration of innovations designed from the outside, and how to help getting acceptance from the core company: this is our everyday life at Orange Vallée, the Skunkworks created by Orange. Don speaks of the paradox of “creativity requiring breaking out of the mold, and the acceptance and buy-in from the core co”. Actually innovation success is to change this paradox into correlation: how can innovation developed outside of the box by a new co keep on with core co business?
Based on the work completed by Vijay Govindarajan and Chris Trimble (“Forget, Borrow, Learn: Secrets to Building Breakthrough
Businesses, Within Established Organizations”, Harvard Business School Press, 2005), I have suggested some optimization of the “Skunkworks” model, making it “a mixed entity”, both outside and inside the group.
What is a mixed entity? It means install a new entity, with its own innovation oriented process, where priority will be given to speed and flexibility, moving fast towards new opportunities and markets. This new entity will be mixed, both “in and out” the established business parent company, to let her build its own organizational DNA, while borrow and leverage on resources from core company and develop a cooperation culture on a selected number of area to strenghthen competitiveness of its innovations.
Moreover, this cooperation culture will build the possibility for new ideas to fit into the competencies of the core co and get buy-in; it could be sustained by 4 levers:
- Detachment of resources coming from the parent company. Those resources will help bring the view of the core co in the project from the start without reducing creativity potential. These resources will be recognized professionals, willing to adapt to the new innovation process of the new co, and being ambassadors of the idea within the core co.
- A network of decision makers. Representatives from key constituencies will be kept informed and consulted across the entire product cycle so as to optimize the product fit with the core co and build acceptance. These core co decision makers, once agreed of the opportunity of the innovation, will have to be sponsors within the core co.
- The investment of the parent company. Relationship may be facilitated in case of the new co acts as a supplier to fulfil a specific need of the core co on an innovation investigation. It will mean that the core acts as a traditional customer and rewards the innovation by an investment, not covering all innovation expenses, but making a significant contribution.
- A portfolio reflecting shared innovation goals between the parent company and the dedicated entity, will help initiate cooperation on common issues.
This is all more or less rational thinkings. What struke me most in Don article is the sentence: “The same people who the new ideas are intended to supplant and go around are now responsible for executing the ideas. No wonder so many good ideas fail.”
Don touches here the fundamental enemy of innovation: fear. Because of this innovation coming from the outside, I fear to be supplanted, to lose my resources (who were not able to bring up this innovation), and to see my control reduced. I believe innovation can not uptake in a culture of fear.
At this moment, the leadership within the company is key: people should not feel threatened by new ideas, they should be fostered welcome them, cope with them, bring their own know-how to see how they can be best adapted to fit the company and contribute to business development. It requires a leadership that is not build on fear and authority, it requires natural leadership: as Michel Fiol puts it, “Natural and not established, leadership is not power based management but the capacity to develop autonomy of the team members and to create co-leaders.”
Leadership for innovation fights fear. It is based on openness, unleashes initiatives , and supports creativity to help new ideas find their path to become great products. In a nutshell, it “learns to dare“
“Lean to dare” is HEC business school catchphase ;-)