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The innovation conundrum

The innovation conundrum

Large companies face the challenge of how they can act like small ones–or whether they should even try.

For large companies all around the globe, the challenge to be truly innovative has proved tough. Generally, the larger a company gets, the more ponderous and bureaucratic it becomes. And the more risk averse. For large companies processes and systems are important, even vital. They ensure numerous corporate governance regulations and requirements are adhered to. They regulate the way human resources are managed. They ensure corporate IT policies are adhered to?–?and corporate IT costs are kept under control. But arguably these structures also stifle innovation and creativity.

Large companies face the challenge of how they can act like small ones?–?or whether they should even try. For many, innovation is by acquisition. Thousands of start-up companies are out there doing what they do best: Innovating and developing. At some point, these companies can, mostly, be bought. Large companies are often better at taking products to market than at creating them.

Formal and semi-formal innovation devices

Some large companies, though, use a range of formal or semi-formal devices to help them innovate and create:

• Rooms with views: Walt Disney set up three different rooms for creativity. The first was the Dreamer room in which any idea could be suggested, no matter how wild. All ideas were encouraged. The second, the Realist, was the room in which dreams became real. Its function was to work out how to make the dreams come true. In the third room, the Critic room, people asked why an idea should be developed. Often, the creative team would move from room to room and back again as the idea developed.

• The five minute rule: Supposedly used in some Silicon Valley firms, when an idea is suggested, only positive comments are allowed for five minutes. The result? Brainstorming.

• Catnip for innovation: Google is reported by Businessweek to allow its engineers one day a week to work on their own pet projects. The company also holds eight brainstorming sessions a year with its engineers. In them, six ideas are pitched and each is discussed for 10 minutes. The session aims to add one complementary idea per minute to the original idea.

Systems for capturing ideas need to be complemented by management support for innovators and schemes to reward innovation. But, and this can be the most difficult to change, innovation also requires an increased tolerance for error and even outright failure.

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