The Future of Innovation in Corporate America

April 16, 2014

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. 

Many of these corporations have built sophisticated innovation programs, often drawing on the skills and knowledge of employee “crowds”. These crowdsourcing efforts identify, select, and develop ideas at various stages of maturity. The goal is to drive competitiveness and financial impact. However, in the majority of organizations it seems that the focus has tended to be on the “front-end” of innovation: identifying and selecting top-quality ideas. 

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 when these companies try to execute their ideas. This is the “back-end” innovation challenge. As David Burkas said in a recent Harvard Business Review article, “Innovation isn’t an idea problem; it’s a recognition problem.” 

Without back-end support, crowdsourced ideas push up against limited resources at the point of execution. Overworked development groups don’t have the capacity, inclination, or incentive to execute these new ideas. The result is a backlog of ideas that existing, constrained resources cannot hope to execute. 

Many leaders are now recognizing that this backlog of ideas represents a missed opportunity for marketplace or financial improvement. 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, more and more companies are now reassessing their focus on front-end innovation activities. As the CEO of Culturevate, a company focused on empowering organizations to execute on ideas and inspire a culture of innovation, I have seen this take place at organizations such as Marsh McLennan and Pfizer. In these, and other businesses, innovation leaders are shifting attention toward activities that drive the implementation of ideas into new products or processes. This represents a significant strategic shift from previous innovation efforts. The result should be a more detailed focus on driving real business benefit from innovative activities. 

By extending crowdsourcing efforts from the front to the back-end of innovation—the point of execution—these companies are asking their employees to not only come up with new ideas, but also giving them the training, resources, and network support so that they can drive the development of their ideas. The opportunity to participate in idea development is being positioned as a reward for high potential individuals. The benefits to the individual include expanding their existing skills, building cross-functional relationships, and working on high priority projects. 

To support these efforts, companies are building and supporting networks of employees with terms likes “Innovation Super Users”, “Innovation Catalysts”, “Innovation Champions”, and others. Though the names of these networks may change, they all aim to enhance collaboration, build a basis for cultural change, and support a readily accessibly pool of future leadership talent. In the short term, this network can focus on cross-functional collaboration, but over time it should be directed towards idea execution and broader cultural change. 

These networks are often supported and engaged through a variety of activities, including:

  • Access to tools and materials around innovation techniques and approaches;
  • Innovation skills training;
  • “Exclusive” competitions and challenges;
  • Regular communications;
  • Leadership sponsorship; and,
  • Better access to developing ideas.

Many of these networks focus on training their employees around the skills of innovation. The expectation 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. 

Companies such as Neiman Marcus, Pfizer, Intuit, GE, and Qualcomm are already building cultures of engaged and trained employees to support the development of ideas. Each of these organizations is taking their own approach to developing and supporting employee networks. What is consistent among 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 for their businesses. 

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.