Building a Culture of Innovation

Successful companies manage innovation from concept to commercialization, so that good ideas not only get created, but also find their way into the products and services portfolio. A culture of innovation is characterized by teams that come to life in a lab environment where they can sense and respond to customers and evaluate what works and what does not work while free of the organizational inertia, or friction, that is the enemy of change and its partner, innovation.

A thriving culture of innovation requires an organization to master the art and science of managing business and technology together, as described in the following three-step approach:

1. Establish one or more innovation labs.
   Innovation labs must operate outside established organizational boundaries in order for teams to create and build prototypes of new solutions. These labs also:
   • provide the success needed to develop a compelling vision of what is possible
   • create respected champions for new ways of doing things
   • articulate and shape potential solutions for the business.

2. Promote viral adoption. The teams return to their everyday environments with a desire to:
   • spread the knowledge of what works
   • apply the lessons learned throughout the rest of the business
   • drive enterprise investment decisions with a shared vision of business benefits.

3. Transform to a converged enterprise. Converged enterprises can achieve competitive advantages that are difficult for their competitors to replicate. These advantages include:
   • sustained innovation
   • enduring business performance
   • uperior financial performance.

   Discipline and innovation are not opposites; they complement one another. Innovation requires a space outside the status quo and its incremental change approach. The act of creating, maintaining and leveraging that space requires discipline, resources and senior management support.

   Establishing an innovation culture consumes a great deal of organizational energy to overcome the forces of inertia and entropy. But once an idea has been successfully commercialized, respected champions emerge to drive new sources of the energy, creativity, discipline and resources that sustain and grow an enduring culture of innovation.