Corporate innovation - an oxymoron if ever there was! Think about the concepts you associate with large corporates – slow to respond, bureaucratic, process driven, hierarchical. Now think about the concepts that define innovation – speed, agility, embedded decision making, output driven, flat structures. The key question is: how do you drive innovation in large organisations with these seemingly disparate and competing concepts?

Rule number 1: Partner. No one flies solo

There’s a reason why startups are so popular in technology. They’re usually small, have an acute need for success (sometimes a guaranteed paycheck drives complacency) and have a passion for solving problems. They also usually have an immense talent for targeting the friction points in your customer journeys and delivering innovative solutions for this. What they don’t have is your brand, balance sheet and customer base. 

So how do you take advantage of this? You could just buy the company, but this is a high cost/ risk solution to solving your problems. The solution is to partner. Give them your problem to solve. Chances are, most large organisations are sitting on decades of big data. Make your data available in a safe and secure environment, and let them innovate the friction points out of your value chain. Losing lots of customers halfway through your sales process? 

High complaints within certain functions? Give them your data and let them solve it! With the right partnership model in place you can both benefit from each other’s strengths. Many large organisations have successfully formalised partnership models such as Munich Re with their Digital Partners business (; Boston Consulting Group Digital Ventures ( who partner to invest, scale and launch new businesses; or companies that can hand-hold innovation processes like Startup Bootcamp ( who help to startup and scale new ventures. There are many options, but you don’t have to fly solo. 

Rule number 2: Set a budget but don’t micromanage it

Large organisations pride themselves on good governance, well established processes and ability to account for money spent using traditional measures. This is really important, but simply replicating that kind of capital allocation strategy for a hyper agile function won’t work. Innovation doesn’t mean no control or accountability. Rather, create the right conditions and space within which to thrive. For example, agree what percentage of your portfolio you are willing to commit (a small percentage of your IT budget can go a long way), agree a set of target outcomes/goals (see below), and give the selected team space to innovate. Have some governance in place, but don’t set up an “innovation board” with representation from all parts of the business to make all the innovation investments and decisions.

Rule number 3: Set audacious goals – but measure the right things

While ROI is important, defining traditional metrics like EBITDA, ROE, P/E, C/I ratios and all other manner of acronyms is not the right way to drive innovative behaviour. Firstly – think about what you want to achieve. Then define how you are going to measure it. Be weary of “top and to the right” metrics (as Eric Reis calls it in his book “The Lean Startup”) – they mask innovation outcomes by rewarding vanity metrics. Innovation should also be driving step changes in your organisation, so don’t focus on metrics that encourage incremental improvements (sometimes things start slow but you are looking for that exponential growth J curve here so make sure you set a time based goal to achieve that).

Depending on where you are in your innovation journey, and what outcomes you want to drive, these metrics can vary from percentage of staff involved in innovation projects, number of new customer facing functionality released, learnings implemented from “failed” experiments, new digital businesses launched or even star ratings on the app store.

The key is to be clear on what you want to drive, and put in place the right metrics that will drive and measure the right behaviour. Incremental didn’t change the world. 

Rule number 4: Get your staff to work for free

I bet that within your organisation there are many employees who have great ideas, many who would thrive in a small startup with a strong innovation culture, and many who could successfully launch their own business. Why not ask if they would like to do that, that while working for you? Invite staff to work on their ideas, give them support they may require (access to data, tools, usage of PC’s or simply the use of the office space and the coffee machine at night) and give them the space to labour away at what excites them and benefits your organisation. This doesn’t have to impact their day jobs (you don’t have to pay them extra – there are other rewards you can explore though), and will be a massive motivator to drive employee engagement. You could even gamify it, try hackathons, or get people to form teams to compete by solving existing problems.

Your employees may be more motivated and innovative than you give them credit for, sometimes all you need to do is ask.

Rule number 5: Culture eats strategy for breakfast

We’ve all heard that before, but it’s true. Don’t focus on creating an “innovation department” or “head of innovation”. Democratise it. There isn’t a single function, value chain or process that wouldn’t benefit from an innovative culture. Focus on building a culture that promotes, rewards and recognises innovation. This will be your highest return on innovation investment. 

Rule number 6: Don’t be shy to ask for help

Even the best organisations can and have benefited from external help. There are companies that focus on setting up hackathons, that will come in and develop your digital business idea (with an equity stake) or help you to articulate and document a clear and coherent innovation strategy – and how to solve the organisational barriers to getting there.

With the guidelines above you can be the catalyst to drive the innovation agenda of your organisation, proving that established organisations can drive innovation. We wish you all success! 

Digital Innovation Organisation Strategy
Reza Suleman

Jan 2021