Why are most large companies struggling to innovate? It is because as a large company there are inherent obstacles that block innovation. Many corporate innovation teams have run amok due to one or more of these factors. It is difficult, perhaps impossible, to eliminate all seven of these from your corporation. But by understanding them, at least you can protect yourself from falling victim to them.
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Business Blindness
Participating in a product category often makes it more difficult to see the disruptive trends and opportunities in that category.
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Self-Reliance Syndrome
Most companies over-rely on internal functional representatives to build new innovations. But most internal groups are designed to support existing products and often don’t have the skills or desire to reinvent categories.
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Bureaucratic Burial.
. In most corporations, too many layers of approvals are required to build or test anything new. Innovation teams need to have flexibility to test and learn.
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Specialist Stagnation.
Most corporations have developed functional specialists that are very good at their area of expertise. But in the process, these companies have lost the ability to think in an integrated fashion – causing them to miss many good opportunities.
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Mindset Mismatch.
The skills and thought processes of successful entrepreneurs are the opposite of those for corporate managers. Most companies reward and promote entirely based on corporate manager skills – weeding out the innovators.
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The Big Bang Launch.
Big companies typically have a single all-or-nothing launch model that involves big spending and fast distribution. Successful start-ups use “slow-build” launches over multiple years that allows for adjustment and increases confidence and success before expansion.
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Portfolio Pitfalls.
Most big companies over-invest in individual new product ideas and fail to cut off bad ideas fast enough. In start-ups there is more discipline over early-stage funding, and start-ups are under pressure to deliver tangible results prior to continued funding.