Innovation and Problem Solving in Corporations

Innovation is a loaded and often misused word.  This has never been truer than when the word is used in large corporations.  How often have large corporations introduced new innovation processes or innovation teams with great fanfare?  At best these teams often focus on problem solving and at their worst, they are simply paying lip service to innovation to fulfill a promise that “we are an innovative organization.” 

This raises the obvious question of what the difference is between problem solving and innovation.  They are closely related, with one fundamental difference.  Problem solving in corporations is about identifying and fixing the problems that people already know about or reasonably should know about.  If you ask enough questions about what’s not working, what is causing problems and what is frustrating your customers, suppliers, employees and partners, you can usually develop a good list of problems to solve.  This can be a useful and valuable exercise.  But…  This isn’t the same thing as innovation. 

Innovation is different from problem solving, because innovation is about solving the problems that no one sees.  Innovation is solving the problems that aren’t obvious.  Incremental enhancements or improvements to a design aren’t innovation as much as they are problem solving.  Innovation may create a new market where one didn’t exist before.  If someone looks at a new product or service and says “Why didn’t I/we think of that?” it’s more likely that they are describing innovation, not simply problem solving. 

There are many well documented examples of innovation, including: the mobile phone, the iPad, WiFi, the spreadsheet, the microwave oven, personal computers, television, and radio.  Much older innovations were things like glass, the abacus, paper, and the printing press. 

Many of these innovations fundamentally changed what was possible at the time.  They changed the way individuals and societies communicated, were entertained, cooked, built buildings and consumed information.

In most cases, they started with an individual or a team saying “What if?”  While innovations are often brought to the mass market by large companies and corporations, it’s far more common for innovations and inventions to originate with individuals or small groups of entrepreneurs.

There is no reason why innovations can’t originate within larger organizations, but often there are organizational barriers making this very difficult.  What is required to innovate within organizations?

Innovation Enablers

1.        People who are creative, open-minded, and curious
2.       Knowledge and understanding of the area of innovation focus.  (This could be the market, the customers, the employees, the suppliers or partners.)
3.       Risk tolerance and an acceptance that failure is part of the process
4.       A sponsor who understands the importance of items one through three and understands how to cultivate, curate and encourage innovation.

People

People are where corporate innovation attempts will succeed or fail.  While nothing can guarantee that innovation will succeed, true innovators tend to look at the world differently.  They are always looking for problems to solve.  They tend to be curious and are willing to ask many questions.  They embrace the idea that there are many ways to solve a problem, design a product or process and are willing to try multiple approaches.  They make connections and see relationships where others often do not.  Most companies have these people, but they tend to be spread throughout the organization.  Individuals with a problem solving mindset may be found in operations, sales, marketing, information technology or any other part of the organization.  Sometimes they are not appreciated by the teams they are part of, because they frequently asking questions and challenge the status quo. 

Knowledge

Innovators in corporations need to take the time to understand their environment.  That often means meeting with customers, employees, suppliers and partners.  It means asking lots of questions and trying to understand both the current environment as well as what the future may hold.  It also means making a genuine effort to understand what are the challenges and opportunities.  This is the point where problem solver and innovator typically diverges.  The problem solver will see the challenges and immediately begin to work out solutions.  The innovator looks at the total environment and sees problems, connections and relationships that others often do not.  They ask “what if” and “why” and they keep asking until they are satisfied that they understand.  They often are looking for the problems that are over the horizon.  They ask how they can make the environment better.

“What if we had self-driving cars; what if we have a battery that lasted for five years; what if we have a recession; what if a competitor launches a completely new service?”

Risk and Failure

Innovation is inherently a risky activity.  It has been said that if you are afraid to fail, you are afraid to innovate.  Very few entrepreneurs succeed with their first idea or approach.  A fear of failure is the death of many innovative ideas in corporations.  Common phrases thrown at corporate innovators are:

•        That would never work,
•          We tried that once,
•          It would cannibalize our existing product/service,
•          Or simply, that’s a dumb idea…

Corporations that wish to innovate must be willing to try new ideas and see what works.  They must give teams a chance to take risks and explore alternatives.  It’s not necessarily bad to have realists and even pessimists on an innovation team.  A team member who challenges other’s ideas can be useful if the feedback is framed in the context of making the ideas better and more useful.  One of the most useful messages to an organization about innovation is simply that “innovation requires us to try new ideas and some of them are going to fail.  That’s ok and is expected.” 

Sponsor

The best sponsors of innovation teams meet the criteria for team members described above.  An organization that is serious about innovation will find a sponsor who is also open-minded, creative, and curious.  The organization will need the sponsor to be a champion who understands that the team will require time to investigate and learn.  An innovative organization also needs the sponsor to be a realist who understands that risk and failure is an inherent part of innovation.  Sponsors like this sometimes are not the person who happens to head the current product or service organization.  A successful sponsor could come from any part of the company as long as they have the right abilities and executive support.  A corporation that wants to innovate must be willing to put the right people into the right places for success.  This includes selecting the right sponsor to champion and support the team.  A good sponsor will give teams the time they need to develop and prove new ideas.  They must be adaptable, willing to drive change and make decisions that upset the status quo.   

Summary

Is innovation possible in large corporations?  The simple answer is yes.  Companies like Apple, Amazon, Starbucks and even Toyota show that innovation doesn’t have to happen in start-ups.   Can corporations take steps to encourage innovation?  An unequivocal, yes! Problem solving and innovation can clearly be encouraged and developed with the right people, knowledge, risk tolerance and sponsorship.  But… There is no guarantee that teams will ever cross the threshold from solving problems to innovating.  That takes the right people in the right place, with the right support.  If it was easy, every company would be innovating.