The conventional R&D function is changing and companies now have a portfolio of ways for generating innovations, including engaging with their employees. Employee feedback is valuable, since employees tend to understand how things are done at the ground level, and how they may be done better.
Large organizations with more than 10,000 employees are significantly more likely to have formalized innovation teams and generate ideas from multiple sources. As a company becomes larger, it becomes more important not to lose sight of ground truth, what will work, what’s practical and what will drive true change. Although employees have good ideas, in a larger organization, people who have an enterprise view and can see bigger, integrated and more disruptive ideas are valuable. To really be successful, the company must manage a portfolio of different types of innovation.
Internally, where does your organization primarily get its ideas about innovation?
Manage a portfolio of innovation
Innovative ideas come in various shapes and sizes. The majority are small, incremental ideas that are easily identified, developed and distributed throughout the organization. This is called sustaining innovation. Other innovations include big bets that could revolutionize an industry and which take time and significant resources to develop. This is typically known as disruptive innovation.
Sustaining innovation is considered the most important type of innovation across both sector and organization size, while disruptive innovation is most important among respondents with more than 10,000 employees. Sustaining innovation is often easier, with results delivered in shorter timeframes. But long-term success in delivering results and differentiating an organization from its competitors depends on a portfolio of innovation types — both hard and easy.
As ideas are developed and disseminated, or as an industry adapts to a disruptive change, ideas will shift down the portfolio. A portfolio strategy ensures a consistent pipeline of ideas and can safeguard an organization from becoming stagnant or complacent.
How important are the different types of innovation to your organization?
A full third (33%) of respondents across industries and organization size look to competitor organizations in their industry for innovative ideas. The challenge around relying on competitors for ideas, however, is that an organization’s competitive advantage diminishes when it is mimicking versus creating and differentiating. Customers are the main source of innovative ideas (83%) for technology companies.
Encourage governments and regulators to enable innovation
Respondents view government’s role as an enabler of innovation through flexible regulation (31%), innovation tax relief (30%) and specific innovation funding (19%), but most really don’t view government as playing a driving role in innovation.
What is the best role for government to play in driving innovation in your company and industry?
Ideas: key success factors
- Encourage co-creation of ideas and support for internal and external ideation processes.
- Define the organization’s approach for disseminating ideas for both internal and go-to-market channels.
- Manage a diverse portfolio of innovations, including sustaining, adjacent and disruptive ideas, transitioning ideas within this portfolio as the idea is disseminated throughout the organization or industry.