How do companies drive innovation effectively?

I’ll divide the answer to that to two parts: internal innovation and external innovation.

Internal Innovation

Hiring corporate entrepreneurs or establishing incubation groups has been an emerging trend.

A couple of elements will make those groups more successful:

  • Start by understanding customers & markets, as well as the company’s core assets. Figure out the leverage. Don’t start with the technology.
  • Hire the right people (skill-set and experience).
  • Senior executive support is key. These groups should report to the CEO or someone on his behalf.
  • Small group. Low overhead.
  • Focus on quick and small wins.
  • I find that being involved and supporting the company’s day-to-day business is very useful, especially in mid-sized businesses. The outcome tends to be more in line with the existing business and less detached.

External Innovation

As mentioned previously, I’m a great supporter of external innovation models. Historically, the majority of innovation comes from small businesses and startups. Think about recent disruptions: search, social networks, e-commerce etc. Facebook, Google, Twitter, Amazon and eBay all started as small companies.

Establishing standalone structures such as innovation centers has proven to have limited success. Tapping into existing structures, such as incubators and early stage venture funds, is likely to lead to better results. Incubators, for example, have already figured out the right formula for driving deal flow and screening entrepreneurs. Partnering with them would benefit both parties.

 

About these ads

About shanishoham

After 14 years of General Management and incubating/scaling new businesses & organizations for enterprises (established a $55M mobile business and a $100M/400 employees global division), I became an investor Today I’m a board member/mentor with 5 incubators & micro-VCs and involved with many other private & public incubators around the world. I also founded a VC firm named 2020 and I'm a member with a number of angel groups so i get to see & work with many startups, innovation centers and other parties across the ecosystem. I’m an alumnus of the Stanford Graduate School of business - Sloan Master in Management program, a 10 months intensive program for 57 carefully selected experienced Executives and leaders from all around the world.

2 comments

  1. Pingback: What’s Wrong With Corporate Innovation ? « Shani's Business Review (SBR)

  2. Pingback: Quora

Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

Follow

Get every new post delivered to your Inbox.

Join 37 other followers

%d bloggers like this: