I will get right to the point. The biggest threat to innovation in any company is its senior leadership team: its C-suite of officers. They may write inspiring articles in company newsletters. They may stress the importance of innovation in company meetings. But if they don't practice what they preach, innovation will founder.
This is especially true when it comes to supporting disruptive innovation--the high risk, high potential return investments in new technologies for new markets. Venture capitalists know that when they invest in a disruptive innovation startup, there is a good chance it will not succeed. They are okay with that because they know the return on investment from the startups that do succeed will more than offset the losses from those that don't. But too many leaders in the corporate world expect every investment to pan out. If it doesn't, the managers who led that investment will likely find their careers derailed. It's a surefire way to discourage those managers from working on truly innovative projects.
Disruptive innovation will only succeed if it has the time and resources necessary to deliver. The best way for the C-suite to encourage this is to commit a specific multi-year dollar amount for investment in disruptive innovation and leave it alone. Assume it to be a totally sunk cost and that any positive return is an unexpected benefit. This takes a level of commitment not seen in many senior leadership teams. It also means those leaders must have confidence in the mid-level managers who lead those innovation projects. And since so many disruptive innovation projects will not pan out, the investment should be spread out across several smaller projects than on one big bet. Once a project has proven it has a strong possibility of success, its investment level can be increased to drive it to completion.
I'd love to hear what you think and whether you see this problem in your own organization.
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