Innovation has become the definitive buzzword throughout large companies across the globe.

More often than not though when executives encourage the masses to ‘go forward, be bold and innovate’, it often amounts to nothing more than lip service.

Innovation is more than just a state of mind and these vocal pronouncements of intent to innovate aren’t met with strategic inputs, and more importantly, successful outcomes.

Yes, we’ve seen the rapid emergence of ‘chief innovation officer’ and ‘head of innovation’ roles across many large companies. We’ve seen the establishment of innovation teams and the odd hackathon being run. Often times this amounts to nothing more than innovation theatre.

Those same ‘heads of innovation’ are often plucked from inside, from roles that aren’t necessarily aligned with innovative thinking, so much as they’re about executing process. Often it’s benefactors of popularity of political navigation contests. I recently asked a ‘chief innovation officer’ from a large accounting firm about his role and the first thing he said was “don’t ask me what I do...I’m not sure yet.” This same executive was hired from within and was previously a partner in a tax practice after having spent more than 10 years in this field. Now there’s nothing in the rule book that says people who come from traditionally mechanical roles can’t be innovative, but to be overseeing the innovation efforts of a 10,000+ employee strong company?

The establishment of these roles and initiatives such as hackathons are all very positive developments in what up until now has been a predominantly overlooked subject.

Today’s volatile business landscape, where technology is driving change ever faster than before, leaves executives with no choice but to try and embrace disruptive innovation in order to stay competitive, lest the companies they manage go the way of Kodak and leave a big black blemish on their CVs.

Challenges To Innovation Tends To Prevail...

The challenge lies in the fact that these same executives got to where they are not by embracing disruptive innovation, but by embracing the antithesis of disruptive innovation - I’m talking about a mindset of risk mitigation and process execution. While this may be perfectly fine under conditions of extreme certainty where we’re dealing with familiar products, customers and business models, when it comes to exploring disruptive innovations, we are dealing with unfamiliar and uncertain circumstances. As such, we can’t rely on set processes and “the way things have always been done around here” to deliver successful outcomes.

According to HBS professor and author of The Innovator’s Dilemma, Clayton Christensen, some of the key characteristics that contribute to the make-up of an innovator include:

• challenging the status quo
• taking calculated risks (manage risk by doing)
• asking questions
• taking many small bets quickly
• seeing failure as a necessary way to learn
• seeing threats as opportunities

Contrast this with the attributes that have made corporate executives successful throughout the 20th Century and much of the 21st Century:

• avoiding risk (manage risk by analysis)
• “failure is not an option”
• conforming with policy and procedure
• taking few large bets slowly

So what becomes of this?

Well, try as they might, corporate executives who have an appetite to follow in the footsteps of their peers at companies like Google and Amazon, tend to fail at their innovation efforts because it takes more than throwing money at something and running what amounts to token innovation events to achieve this success.

Innovation must be holistic, ongoing and more than an isolated one off event.

Key processes: How assets are created

Patterns of interaction, coordination, communication, and decision-making through which resources are transformed into products and services of greater worth.

Some common processes and metrics which inhibit disruptive innovation:

• Gross Margin
• Opportunity Size
• Time to breakeven
• End-product quality
• Owned versus outsourced
• Channels
• Pricing
• Performance Demands
• Brand Parameters

Key values: Culture and how decisions are made

• Just some of the ways that values can be a thorn in the side of disruptive innovation:
• Short-term, incentive based mindsets
• Risk mitigation by analysis as opposed to managing risk by doing
• “The way things have always been done around here”
• Threats are seen as something to defend against as opposed to opportunities to explore
• Efficiency and predictability take precedent

Key resources: Assets, tangible and intangible, that contribute to what an organisation can accomplish.

Resources include:

• People
• Equipment
• Technology
• Product designs
• Brands
• Information
• Cash
• Relationships with suppliers, distributors, and customers.

It is imperative that the processes, values and resources of any innovation initiative are perfectly aligned to support innovation. Otherwise, they are doomed to fail despite best intentions.

For example, idea generation contests are often put forward by many large companies as an example of their innovation efforts but also often failing to bear any real fruit. This is because executives charged with selecting winners do so using an existing value set which means they tend to select those safe ideas which satisfies their existing customer base and for which there is an existing market. The result of this is that small, incremental innovations are selected which won’t help a firm catch the next S-curve, and miss out on disruptive opportunities which by their nature are commercialised in insignificant markets initially.