Friday, November 7, 2014

The Future of Innovation in Corporate America

In recent years, Fortune 500 businesses have utilized a variety of approaches and positions to encourage an innovative culture within their organizations, with varying degrees of success. Now that growth is once again a corporate priority (after years of cost cutting efforts) and the understanding of how to create innovative cultures improves, there has been increasing focus on this issue from executive leadership.

Over the past few years many corporations have built sophisticated innovation programs, often drawing on the skills and knowledge of employee “crowds”. These crowdsourcing efforts should be focused on identifying, selecting and developing ideas at various stages of maturity, in order to drive a competitive and financial impact. However, the focus has tended to be on the “front-end” of innovation, namely the identification and selection of top quality ideas.

The reasons for this are varied, but while coming up with new ideas sounds like a great approach to generating innovation, especially in the context of engaging employees, real problems often occur in the execution of those ideas. This is what is often referred to as the “back-end” innovation challenge.  As David Burkas said in a Harvard Business Review article (July 2013) “Innovation isn’t an idea problem; it’s a recognition problem.”

This idea backlog is often a result of crowdsourced, idea generation activities pushing up against limited resources at the point of execution. In other words, the front-end crowdsourced approach stops at the point of execution. Generally, overworked development groups don’t have the resources, inclination, or incentive to engage in executing these new ideas.

Many leaders are now recognizing that this backlog of ideas created by an activity imbalance represents missed marketplace or financial improvement opportunities. In addition, there is the potential to turn-off those employees that they have worked so hard to engage in the first place.

For this reason, many companies are now reassessing their front-end focused innovation activities, and are shifting attention towards activities that drive the implementation of new products or processes, with a goal of generating a bottom line impact. This represents a significant strategic shift from previous innovation efforts for many companies. The result should be a more detailed focus on driving real business benefit from innovative activities.

Aligned with this move, organizations are extending crowdsourcing efforts from the front, to the back-end of innovation. In other words, these companies are asking employees to not only come up with new ideas, but also giving them the training, resources and network support so that they can develop and launch new ideas. The opportunity to participate in idea development is being positioned as a reward for a broad range of individuals, rather than a burden for already overstretched specialist teams. The benefits to this broader range of individuals that have the opportunity (not obligation) to develop new ideas include expanding their existing skills, building cross-functional relationships and working on high priority projects.

To support these efforts, companies are building and supporting formal (and at times informal) networks of employees that are given the designation as “Innovation Catalysts”, “Innovation Champions”, etc. This remains a side responsibility of these employees, and they are giving opportunities to connect and engage with like-minded individuals, through connections back to often centrally managed innovation efforts.

The short-term goal of these networks is to enhance collaborative opportunities, enhance employee engagement and increase the flow of ideas. The longer-term goal is to create a flexible and responsive pool of future leadership talent and build a basis for cultural change.

These networks can be supported and engaged by a wide range of activities, some example of which include:

·         Access to consistent innovation-centric tools and materials
·         Training around innovation skills and approaches
·         “Exclusive” competitions and challenges
·         Regular communications, including access to newsletters
·         Opportunities to connect and engage with senior leadership
·         Better access to developing ideas, etc.

As an initial step, many network leaders are choosing to focus on training their membership around a set of consistent innovation skills and techniques (I have written about this here). The hope is that these newly trained employees will be able to improve the quality of idea submissions and act as a resource for idea development going forward. In addition, given that the employees have been rewarded with the new training, they should be encouraged to be active members of a network, helping to drive activity and success for the network going forward.

Some examples of companies that are already successfully building cultures of engaged and trained employees include Neiman Marcus, Intuit, Pfizer and Qualcomm. Each of these organizations is taking their own approach to developing and supporting employee networks to drive innovation. What is consistent amongst them is that they are looking to utilize and direct those networks to drive a culture of innovation, with a goal of generating financial impact to the business.

By following the lead of these organizations, other companies are now looking to enhance their own innovative cultures, and to utilize employee networks to drive additional business results. This renewed direction for innovative activities should drive further benefit to organizations, and encourage their success in a globally competitive marketplace.

About the Author: Anthony is the CEO of Culturevate (, an organization that empowers a company’s employees to execute ideas and inspire a culture of innovation, through employee networks, a resource portal and training programs (developed in association with Professor Chris Labash from Carnegie Mellon University). Anthony is a widely read author (, speaker and advisor to industry leaders at organizations such as Pfizer, U.S. Postal Service, Johnson & Johnson, ADP and Fidelity. He previously led The BNY Mellon innovation program and has a Masters of Commerce (University of Sydney) and Bachelor of Economics (University of Newcastle).

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