We found that there isn't a "one size
fits all" approach to innovation. 

Over the last six months, we’ve taken a deep dive to learn directly from the corporate entreprenuers at leading companies in fields ranging from fintech to medical devices.

Three Universal Principles  

Guiding principles for every Corporate Innovation Program to consider

 
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Instead of setting out to build everything at once and hope it works out, the best companies take an iterative approach validating key hypothesis about the idea and only at that point making additional investments to validate more things.  

The best corporate innovation programs draw a distinction between failure as a result of not following the right process vs failures that really come from ideas being invalidated. Failure due to faulty process is a challenge that needs to be addressed and invalidated ideas need to be accepted with zero impact on the career trajectory of the people involved.

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Unlike other initiatives inside a company, where calculations like a simple Net Present Value can be calculated, corporate innovation programs are more challenging to predict the value of prior to launch. The best organizations look at these investments of capital and employee’s time differently for innovation projects. 

Five Dimensions of Differentiation

The following FIVE dimensions are important to consider when
putting together your CORPORATE innovation programs.


In some organizations, through a combination of corporate training, recruiting and executive sponsorship the goal is to reimagine everyone’s job in a way where they are being innovative.

On the other hand, some companies clearly have carved out a subset of employees and/or recruited employees from the outside and tasked then with the goal of leading innovation opportunities for the company.  


Some groups felt it was incredibly important for employees leading efforts to the become more innovative felt it was important that teams responsible for creating new products or services needed to share in the “upside” being created.  While there are different models for enabling this, the concept is consistently trying to simulate the similar (even if on a smaller scale) financial outcomes for the team's leading this that they could receive if they instead left and worked on a startup.  The obvious advantage here is for many innovative professionals this makes it a much more economically rational choice to work for a larger company versus a startup.

Other groups we spoke with felt that this wasn’t necessary.  They felt like the opportunity to have impact from creating new products / services and inherent value from seeing these initiatives succeed  was enough.  


Some groups were very committed to building new products and services predominantly or even exclusively leveraging internal resources. The obvious advantage to this is that it provides the greatest amount of control over the projects, but often run into constraints (per Constrained vs. Unconstrained section below).  

Some groups had developed very interesting partnerships with other companies, startups or even academics.  These partnerships when managed correctly often seem to be an amazing accelerant, but managing all parties expectations upfront is clearly critical.

Finally, some groups augmented their innovation activities through a combination of corporate venture or m&a.  While arguably expensive, this is a great technique to catch up on areas of expertise the organization may have fallen behind on or simply explore future anticipated areas of strategic importance for the organization.   


Throughout our conversations, it was clear that there are a number of different  constraints that are unique to larger organizations.  While each company is different, this can include constraints around regulatory approval, risks around financial exposure or negative current customers to the new idea.

It seems like two very effective techniques sometimes to deal with this are:
(a) partnerships with outside organization.  We believe academic partnerships are particularly compelling in this area. (b) initially marketing the idea “off brand” where it isn’t obvious that the idea is sponsored by the larger organization responsible for the idea.


Some groups were very committed to building new products and services predominantly or even exclusively leveraging internal resources.  The obvious advantage to this is that it provides the greatest amount of control over the projects, but often run into constraints.  

Some groups had developed very interesting partnerships with other companies, startups or even academics.  These partnerships when managed correctly often seem to be an amazing accelerant, but managing all parties expectations upfront is clearly critical.

Finally, some groups augmented their innovation activities through a combination of corporate venture or m&a.  While arguably expensive, this is a great technique to catch up on areas of expertise the organization may have fallen behind on or simply explore future anticipated areas of strategic importance for the organization.