TIGER Talk Recap: Sustainable Innovation Strategies for Corporate Transformation
Most CEOs understand that corporations need to innovate to stay competitive and are willing to invest in innovation to see results. But many widely adopted innovation strategies are not successful because companies fall victim to the common pitfalls. CEOs don’t know how to make their innovation efforts sustainable.
At Innovate New Albany’s TIGER Talk on October 11, Dan Haber and Oren Goldschmidt, co-founders of Flow Innovation, shared innovation strategies that are impactful and long-lived. Their presentation, “Sustainable Innovation Strategies for Corporate Transformation” was full of real-world examples of how they helped turn mid-market players into global innovation leaders in just a few short years.
According to the S&P 500 Index, the average age of a company was 60 years in the 1950s. Today it’s 20 years, and it’s projected to be only 12 years by 2025. Between 2014 and 2017, major innovation labs closed around the country, including Microsoft, Disney, Coca Cola, and Ogilvy. Despite the fact that corporations were spending $700 billion on innovation, it was not driving value for the organizations.
Using three examples with stories, Dan explained why this is happening:
- The Cargo Cults Story. Innovation labs have smart people running them, but they often lose sight of building value for the end consumer. Many get caught up in the trappings of what the end state might look like. Big companies like Google, Apple, and Amazon all started in humble beginnings. Companies must make sure they are focusing on the fundamentals.
- The Tech Heroes Story. We anticipate all the innovative things we can do with the newest and greatest technologies. While a technology solves a problem, it might not drive the volume of development an organization needs to be sustainable. Tech is only an enabler. We have to connect it to fundamentals that move value in a significant way.
- The Safe Spaces Story. Ideas are fragile and delicate in the beginning, and they need time and space to be cultivated, refined, and developed. Too often, in the early stages, we end up looking at measuring what is easy to see and quantify. We lose sight of what drives value and outcomes. Being disconnected in these corporate environments is ironically not a safe space. We have to make sure we are connecting in a meaningful way that drives the organization forward.
Oren told a story about how he transformed a service-oriented regional bank into a global innovation leader in three years, while retaining and leveraging its “DNA.” He said an innovator’s job is to build an organization’s bridge to the future and drag it step by step into that future.
He explained there are three footholds to sustainability:
- Transforming the Core. Sustainable innovation needs to be about impacting the core business. It needs to have an impact today as well as in the future.
- Lead with Strategy. Rather than set up an innovation lab and coming up with cool things, start with the fundamentals. What are the economics of the business, how do they work, what is the strategic plan for the next three, five and 10 years? Innovation needs to be embedded in the plan and accountable for some part of your growth and efficiency.
- Align Incentives. If you want to recruit in-demand entrepreneurs, a generous salary is not enough. Corporations must be able to offer unique assets that entrepreneurs can’t get anywhere else. Recognize what entrepreneurs need, and clearly articulate what differentiates you from other VCs.
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