The Three Pillars of World-class Corporate Innovation
My good friend Alexander Osterwalder, the inventor of the business model canvas (one of foundations of the Lean Methodology) has written a playbook (along with his associate partner Tendayi Viki,) From Innovation Theater to Growth Engine to explain how to build and implement repeatable innovation processes inside a company.
Here’s their introduction to the key concepts inside the playbook.
Over 75% of executives report that innovation is a top three priority at their companies. However, only 20% of executives indicate that their companies are ready to innovate at scale. This is the challenge for contemporary organizations: How to develop a world-class ecosystem that can drive repeatable innovation at scale.
The playbook describes the three pillars of corporate innovation: Innovation Portfolios, Innovation Programs and a Culture of Innovation. Under each pillar, the playbook describes three questions that leaders and teams can ask to evaluate whether their company has the right innovation ecosystem in place.
- Are your company’s innovation efforts exploring or exploiting business modes?
- Does your company have a balanced portfolio of projects that cover efficiency, sustaining and transformative innovation?
- What is the health of your innovation funnel or pipeline?
Explore: Search for new value propositions and business models by designing and testing new business ideas rather than execution.
Exploit: Manage existing business models by scaling emerging businesses, renovating declining ones and protecting the successful ones.