Developing Agile Innovation Capabilities
Innovation is the lifeblood of growth, providing the new products, services and business models that keep a company competitive, increase market share and challenge talented people. While traditionally one of the greatest challenges that companies faced is capitalizing on innovative ideas while running their core operations ever more efficiently, today often the question is how can they innovate smartly in a fast-paced environment—how can large organizations develop rapid innovation capabilities and feed creativity? The tenants of lean innovation are early experimentation on specific assumptions; use of technology such as open sourcing of ideas and production; and scaling only when you have confidence and validation of your product-market-fit (PMF). Key principles in lean innovation are minimum viable products (building and releasing products to gain feedback and quickly update); smoke tests (testing aspects of a product before having the full product or service); bucket tests (truly random testing of bundles of attributes “buckets” to gain market information); and outsourced scaling (leased manufacturing, open knowledge sources for ideas, external marketing channels). Specifically, we focused on such questions as:
- Since it is most often used in startups, what does lean innovation mean to established large firms, and how does it fit with their overall strategies?
- How do you set up an environment that encourages smart innovation where it matters most?
- What systems of experimentation and measurement have worked well? Are there new and unique ways to provide feedback, both internally and externally to make company decisions better and faster?
- What technologies enable lean innovation and what is their impact on / compatibility with traditional large enterprise operations?
- How do you nurture innovation? Can you give various parts of the business visibility to new ideas, allowing untapped/unknown expertise to chime in? How do you “bubble-up” the best ideas for new products/services or new businesses to leadership for review and decision?
- What role do your customers and partners play in your innovation cycle?
- What is the emerging role of “reverse innovation” (developing products in emerging economies) and how important is it to the long-term health of global corporations? Can these environments be a source of lean innovation?
- How do you determine when an innovative idea is different or strategic enough that it should be its own business? If an idea is determined not to require its own separate business structure, to what extent is it necessary to reexamine a company’s approach to structure, staffing, systems and culture to allow successful execution/delivery of the product or service? If an idea merits a new business, what aspects of your organizational DNA must you be willing to fundamentally reexamine in order to launch and support such a new venture?
- What ways can the concepts of lean innovation be used to enhance design of information systems and access?
- What new demands do lean innovation strategies place on information systems and technologies in companies? What new knowledge is required to manage these systems?
Center MBA Fellow, Nicholas Bazarian T'15, sits in at the Roundtable behind Luis German, Director of Business Process Management at Tenaris (left) and David Straight, Technology Manager at Chevron North America Exploration and Production Company (right).
The participants dive into the topic...
... on both sides of the room.
Twila Day, Managing Director at Alvarez & Marshal, shares her perspective on agile innovation.
(left to right) William J. Braun, CIO, Chevron Upstream and Gas; Mark Meyer, Head of Global IM, Tetra Pak Group and Keith R. Sturgill, VP and CIO, Information Technology and Corporate Six Sigma, Eastman Chemical Company.