When I think about who should ‘own’ or manage innovation, and where it should reside in an organization, I believe the answer is obviously “It depends.”
There cannot be a single answer for these questions because every organization’s strategy and specific culture of getting things done could be different. But, the one thing that I can say for sure is the following:
“Every CEO must own innovation, but not manage it.”
The CEO must own innovation because he or she is responsible for approving the strategy that the organization is going to pursue. At the same time, managing innovation is an emerging specialty of the same level of complexity of human resources or finance, and so CEO’s are not qualified to manage it outside of deciding who should manage innovation in a manner consistent with the organization’s strategy.
The most relevant variable from the organization’s strategy in determining how innovation should be managed is whether or not an organization is committed to being an innovation-led organization. If the organization intends to be an innovation-led organization (attempting to improve every component and offering of the organization through innovation), then a dedicated innovation organization should manage innovation. If the organization would prefer to pursue innovation as a periodic or product-focused effort, then Marketing or R&D should manage innovation.
Another way of looking at who should manage innovation is to ask yourself the following question:
“Who is going to be asked to, allowed to, or encouraged to contribute innovation ideas?”
Your answer determines who should manage innovation. Here are some answers and their implications:
1. Our Scientists
- In a research-led organization, R&D should manage the innovation efforts of the company with input from Marketing, Finance, HR, and Legal. R&D should be responsible for providing the appropriate innovation training to the R&D department. Marketing-led organizations should see #2.
2. Our Customers, Partners, Suppliers (or all three)
- Marketing should manage the innovation efforts of the company with input from R&D, Finance, HR, and Legal. Marketing should be responsible for providing the appropriate innovation training to people managing the process.
3. Our Employees
- A new centralized innovation group should manage the innovation efforts of the company with input from Marketing, R&D, Finance, HR, and Legal. Marketing should be responsible for providing the appropriate innovation training to the Marketing department.
4. A Combination
- As soon as the combination includes employees, a new centralized innovation group should manage the innovation efforts of the company with input from Marketing, R&D, Finance, HR, and Legal. Marketing should be responsible for providing the appropriate innovation training to the Marketing department.
The reason that almost every scenario ends up with a centralized innovation group managing innovation is because of the complexity involved in properly managing innovation. A centralized innovation group has the opportunity to continually evolve the innovation understanding of the organization and cascade that knowledge through a set of innovation champions, distributed throughout the organization. A centralized innovation group can also remove most of the innovation management burdens from other groups by taking responsibility for managing the policies, processes, systems and training needs for idea generation, selection, funding, and development. This allows other groups to focus on achieving excellence in their day jobs and coming up with great ideas.
And, after all isn’t that what we’re all after – great ideas to turn into marketplace innovations?
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Innovative service organisations…
Dell and their use of twitter
HP and some of their B2B service supports
Generally the larger the company the less innovative they can be at a service level. Innovation, unlike previous trends – LEAN etc, do not scale.
If you take innovation to be product and service generation then yes large scale enables leaps (Look at LG, Apple) – but to deliver "soft services" and to have a true culture of innovation requires more empowerment (old word going out of fashion!)
Product and technical innovation has its place – but it is NOT where 95% of innovation in a firm can come from. If you believe the concept from Byrd that innovation =creativity * Risk taking – then you need to have the ideas – and the best ideas come from a broad church of people not niche people.