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Breaking the inertia of not innovating


Let me start with a frequently stated quote “According to Forbes, the average lifespan of a successful S&P 500 Company was 67 years in the 1920’s. Today it is 15 years.

Clichéd as it may sound, a constant focus on innovation is the only way for companies to survive and sustain themselves through the constant onslaught of disruption. Despite this the obvious truth staring them in the face, why do most companies never innovate? What lulls them into a Rip Van Winkle-esque state of inertia?

Let’s do a quick diagnosis!

Most established companies, according to Steve Blank (the Founder of the Lean Startup movement), have built their expertise around a core set of activities. The organization KPI’s, operational metrics, and processes are structured around it. These are in general incompatible with innovation – which is unstructured, hard to define/develop and box. Shaping the organization would mean adding a new bureaucratic layer to define it would be a Weberian delight, but an innovators nightmare. Think Buzz Aldrin filling in a travel form on his way back from the moon.

Going Top Down

Going forward, developing an innovation culture is a top down approach, with the CXO team being innovation evangelists, with their attitude percolating down the organization structure. However, this dynamic is generally missing because there are more pressing priorities to ensure the company functions on a business as usual mode. In addition, innovation successes take time and effort to build (sometimes like a J-curve). With the CXO team generally under the microscope to deliver on profitability metrics constantly, very few would have the necessary appetite, and the result: focus is mostly on the short term.

Overcoming the inner demons

Even if the appetite exists, building innovation as a focus area requires cross functional collaboration (finance, legal, sales, procurement, etc.). This is not an easy battle to win through consensus, since each unit has their own set of priorities that may not align with the broader organization objectives. Even if all the stars align, the more difficult task of building the innovation team is a Herculean task. The skill sets required are niche (independent thinker, questioning the status quo, cross functional/cross disciplinary skills) and are not available in abundance.

One step at a time

A more fundamental problem is the general attitude towards innovation. There is a misconception that innovation needs to be path-breaking, out of the box, and requiring a new thought paradigm (read tons of monetary investment). However, innovation can also be incremental to begin with (Kaizen like). Taking a leaf out of the Toyota innovation playbook, a little improvement everyday amounts to a lot (of IP and revenue) over the middle and long term. It therefore makes sense to start today, outline your innovation vision and embark on it.

What are you waiting for?

If you are getting started at innovation or want to take your innovation journey to the next level visit us at the Applied Innovation Exchange in Capgemini.

The Applied Innovation Exchange (AIE) is Capgemini’s global platform designed to enable enterprises to discover relevant innovations; to contextualize and experiment with them within the specific industry. The AIE leverages a framework for action, a network of exchange locations, and a high performance engagement experience with a global curated ecosystem to proactively plan for shifts in technology.

Vikram Ramarajan

Project Manager
Applied Innovation Exchange, Mumbai
Find me on Twitter @vikramramarajan