Selling an innovation lab to your boss: this is why

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Written by:
Iikka Väkiparta
Chief Growth Hacker

After observing innovation both from within large corporations and in corporate innovation labs, I have been left pondering why innovation succeeds in labs and in small teams. My conclusion is  split it into three distinct areas.

1)    Motivation

Daniel H. Pink in his book Drive: The Surprising Truth About What Motivates Us, splits motivation into three factors which are:

·      Autonomy – Our desire to be self-directed

·      Mastery – The urge to get better skills

·      Purpose – The desire to do something that has meaning and is important

In a lab environment, it is significantly easier to give teams all three. Generally, in labs teams have autonomy in designing their ventures and feel that they are in control of their own destiny. The team can focus fully on their venture thus allowing them to develop mastery on the field. By focusing on single venture, teams have a strong purpose.

On the contrary in a traditional corporation innovation models the project teams come from several organizational units contributing varying amounts of time and effort. Decisions are often made in boardrooms where the innovation team is only presenting but not making decisions. Team is also presented with requirements build for established business from support organizations that feel too cumbersome at the start up phase.

2)    Positive reinforcement

A well-structured lab environment has several projects and each of them are progressing at amazingly fast pace. They encompass ideology of learn fast and kill fast. Ventures need to demonstrate progress and achievement to obtain more funding and proceed. Alternatively ventures that are stalled are pruned out efficiently. This drives to create a cycle of positive reinforcement. Ventures that are succeeding are constantly getting positive feedback in forms of achievements, new sales records, new milestones passed or new technology mastered. This all motivates the team and pushes both the successful venture forward and improves atmosphere in the entire lab. Venture teams find themselves engaged and happy coming to work.

On contrary in a corporate environment the small achievements that new projects generate are viewed as small compared to the established business. The teams are too isolated to get support from each other. Team often gets negative feedback from support organizations such as brand, legal or finance, which forces the team to comply with the requirements build for the established business. These burden the small team extensively and easily lead into a cycle of negative reinforcement.

3)    Sharing

Good labs have multiple venture teams. This is important not only for hedging the risk, but also to speed up the learning in the lab. Each venture team is at different stage in their progress and thus can learn from one another. The lab environment should foster a culture of sharing, where venture teams can learn from each other on what tools and techniques to use, what marketing messages work, what are good marketing audiences or even who to talk to in the mothership. This sharing both increases motivation as venture teams can celebrate each other’s successes but speeds learning and thus allows each new venture to be able to proceed faster than previous.

A good lab gives you a competitive advantage both on commercial market as well as on attracting the right talent. Your company can also shift gears and get new speed at innovation. If you are still lost in how to get started, give us a call and we’ll help you!

 

Read more:

3 reasons companies do not work with startups + 3 ways to overcome them 

How to not fail abysmally with your corporate startup program