Today more and more companies either have, or are developing, innovation centers – albeit at a variety of different scales and while it can be easily argued that innovation should be naturally embedded in the culture of every organisation and permeate through every department, especially those departments with customer facing roles it’s surprising that not all companies harness the natural creativity of their work forces or partner ecosystem to improve their top and bottom line revenues and shareholder returns.
Of all the ideas submitted it is a well known fact that only a small percentage will eventually make their way through the Innovation Funnel to become marketable products and services and while many ideas never get past the starting blocks there are still myriads of stronger ideas that fall out in the latter stages because they don’t fit or align with the objectives of the core business. Larger organisations either try to spin these ideas off as separate divisions or businesses, with varying levels of success, or, as is more often the case shelve or abandon them. Culturally shelving ideas can often do an organisation more harm than good and not only does the business miss out on potential new sources of incremental revenue but the process of continually shelving strong ideas, if not managed carefully, can lead to a gradual erosion of morale and begin to reduce the teams creative passion, all of which in turn erodes the company’s returns. Once shelved these ideas are only slightly alive and slightly alive generally means mostly dead. These ideas can therefore be thought of as “Zombie Innovations” and today there are millions of Zombie Innovations out there, all gathering dust.
Some organisations however are bucking the trend and are fighting back against the rise of Zombie Innovations. They are developing platforms that directly connect their Innovation and Finance departments with Venture Capital and Angel Investment firms. This allows them to continue pumping out innovations but then allows them to sell or license the IP for Zombie Innovations to partners who are better positioned to finance, incubate and take them to market, in some cases jointly where each organisation owns a percentage stake in the any new enterprise that is created as a result. Not only does this new channel approach reduce the inherent risks associated with innovating ‘en masse’ and turn otherwise business centric Innovation centers into Innovation Factories but it also brings net new capital quickly into the business and generates new annuity based revenue streams that can be used to offset future Research and Development costs. The approach, however, also has additional unseen cultural benefits because these Innovation Factories are now seen as centers of industry excellence that are starting to attract a new breed of innovators and inventors. More than that though companies can easily broaden the channel scope and allow all of the want-to-be innovators in their workforce to benefit from access to the right internal talent pools and the right external investment opportunities which allows them to give regular employees a shot at winning that elusive big win lottery ticket which could see them become a majority stakeholder in their own agile new start up.