For Innovation at Scale, stop moping about “culture”

As “digital” sweeps through the land, a lot of big companies have decided they need to become more innovative, and they have established corporate innovation departments to help them along. These groups typically try to bring some startup magic into the machine. They may also hire “agile” consultants to do training and coaching and work on culture and process. But, they are neglecting their most powerful weapon — business structure. A deck that we put together for a large organization outlines these tactics.

Structure is obviously more powerful than culture when you look at the following evidence. Three of our Apex Competitors have very different cultures, but they can all win with the right product structure. Amazon has an authoritarian culture where direction comes sternly from CEO Jeff Bezos. Google has the more egalitarian culture of a Silicon Valley startup and band of coders. Microsoft has, over the past 30 years become an old-style bureaucracy like many of its public company peers. Yet, they can all be good at the task of innovating at scale.

The first thing that I take away is that you should not say, as so many of our prospects say, that an organization has the wrong culture and skills. That is changing the subject away from the real goal, which is delivering business value. Work on culture may be a waste of time, as it does not need to be particularly relevant to the question of whether you can deliver and improve new products.

The second thing that I take away is that most corporate innovation groups are DOING IT WRONG. They are neglecting their most powerful weapon. They spend a lot of time working on startup tactics like incubation, investment, partnering, open innovation, and design thinking. Where possible, they work on culture and process with workshops and training. They usually completely neglect structural changes. So, they are leaving 80% of the potential gains on the table.

The recipe for success includes metric-driven product management, re-usable services, and continuous improvement. It adds value by continuously improving products, not intermittently delivering projects. It adds responsiveness by giving product managers the option to source (buy) talent, services, and components inside or outside of the company. It adds adaptability by giving teams the opportunity to work for multiple product managers and support new and expanding products. These are all structural changes that you can put in place to support your innovators. After that, the innovators can wave their metrics around, and use the convincing power of numbers to pull everyone else into the effort, regardless of culture.