Over the past 9 years, Board of Innovation has supported many large organizations in designing and executing a wide range of innovation initiatives. Now, navigating through all these different formats is not always easy. Multiple times, we’ve been asked by innovation managers questions like ‘What is the best innovation initiative for our organization?’ or ‘How do others tackle this problem?’.
To reply to these questions we’ve created a matrix that compares 9 innovation initiatives that Board of Innovation applies most. Surprisingly enough, we call it the Innovation Matrix. Its aim? To support you in making the right decision when it comes to launching your next innovation program so that you can make the most of your innovation budget.
First, let’s look at 9 innovation initiatives you will love
- Startup Fund. A startup fund is a corporate fund that invests in external opportunities. It aims to generate growth through external capabilities in line with the strategic objectives of an organization.
- Emerging Business Areas. Emerging (or New) Business Areas are sandbox environments where new business initiatives can grow before they prove their profitability and potentially enter an actual business unit, or become a new business unit.
- Center of Excellence. A center of excellence is a formal group in the organization that coordinates innovation initiatives to ensure that innovation is structurally embedded in the organization.
- External Incubator. An external startup incubator is a corporate initiative to support, grow and evaluate external startups for a specific period of time.
- Internal Accelerator. An innovation accelerator is an internal innovation program to free up time for intrapreneurs to develop, test and grow new business ideas outside of organizational processes and deliverables.
- Community of Practice. A community of practice is a cross-functional group of people within an organization with common interests and goals who share expertise within the organization.
- Innovation Challenge. An innovation challenge is an open initiative to get external expertise to solve organizational or societal challenges.
- Design Sprint. A Design Sprint is a (five-day) process for answering critical business questions through design, prototyping, and testing ideas with customers. It is an ad-hoc initiative that forces employees to interact closely with the outside world.
- Innovation Workshop. An innovation workshop is a (1+ days) session through which employees are invited to create new ideas or business concepts outside of the normal work process.
Vital parameters to navigate through innovation initiatives
To help you navigate through these 9 innovation formats, we organized them according to two key parameters.
We define innovation programs any activity that influences and innovates a company strategy. This could range from a 4-hour workshop to a 2-year strategic innovation plan. So, the first variable in selecting the right innovation program is: do you need a one-off event (e.g. a design sprint, a workshop, etc.) or a structured plan (e.g. a center of excellence)?
The second question you must ask yourself is: do you want to rely on internal or external capabilities for innovation to happen? You may either promote the acquisition of a startup, or encourage intrapreneurial thinking with existing capabilities.
The Innovation Matrix – A tool to define the Innovation Strategy that fits your company
Introducing: the Innovation Matrix. You define the benefits you expect from your innovation program, the Matrix will tell you the most suitable one. Let’s see some of the questions it can help you to answer.
Do you want to attract new talents to your company?
Corporations are increasingly relying on external capabilities to make innovation happen. Why? Because there are already thousands of ambitious, talented experts out there who are trying to solve, with a start-up, the same problem that you’re tackling. Good to invite them for a beer?
- Do you want to start promoting intrapreneurship?
Innovation cannot rely only on external capabilities. First, innovation must be part of the strategic agenda. Secondly, not only the top-management, but the whole organization benefits from an innovation-driven culture.
- Do you value external growth above internal transformation?
Your organization is looking for fast business growth. The use of external resources can boost your business inorganically. Corporate venturing isn’t the easiest activity, so be sure to spread your risk and grow your maturity step-by-step.
Do you want to establish a long-term innovation pipeline?
Looks like innovation is at the very center of your company: great to hear that. There’s now the opportunity for high-level strategic discussion. By choosing long-term, highly-integrated initiatives, you’ll make sure that your innovation plan has the necessary time frame to impact your operations and internal organization.
- Do you have one single issue to tackle?
One-off programs are short, sweet and cheap. In a matter of few hours or days, you are able to offer your employees a flavor of what innovation is. Be aware that these programs tackle one single problem, deliver one single message, and train employees over a specific array of skills. Better to be specific in the problem statement with this kind of programs, or you’ll get lost in irrelevance.
- Do you need to minimize the risk of your innovation initiative?
The best way to cope with risk is to start small, test, learn, restart again and scale up step-by-step. The best way to do so? Start with small, ad-hoc innovation initiatives, such as design sprints and workshops. Bet on different horses and compare the value of each one. Be sure to coordinate your diverse efforts, in order not to lose your focus.
Here you can find a print-friendly poster that you can print yourself on an A3 as a reference grid to navigate through the innovation formats:
How to grow the innovation maturity of your organization?
The innovation maturity of your organization increases when you try different initiatives. You start with ad-hoc initiatives, stop the ones that don’t create the expected ROI, and transform others to embed them more over time. You grow knowledge, foster innovation, and spread the risk among different formats.
Step 1: To explore and try out the most suitable format, it’s best to try at-hoc initiatives first. You can test the value of initiative relatively quickly and cheaply. Typical ad-hoc formats are innovation challenges, design sprints, or innovation workshops. This overview is not inclusive for all initiatives, but it compares a few common practices.
Step 2: External incubators, internal accelerators, and a communities of practice are ideal next steps to embed innovation more structurally in the organization. They usually take more time than ad-hoc initiatives (3-12 months) and allow organisations to understand the potential of a program.
Step 3: To embed innovation initiatives, structural investments must be made. This can be done in various ways, from externally focused startup funds to internally focused centers of excellence.
If you’ve read all the way through this article, the chance is that you’re eager to learn even more about the right Innovation Strategy. Join our live webinar and start a conversation to have a personal advice – we’re here to help you.