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5 Innovation Styles for Organizing theInnovation Process
The Fertile Field
The Cauldron
The Spiral Staircase
The PacMan
The Explorer
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The Cauldron
Key Levers
Internal markets for new ideas
Venture capital model of internal entrepreneurs seeking
fundingfrom both internal and approved external sources
Use of peers rather than bosses to screen and
evaluateopportunities
Loose structure and fre!uent organi"ational changes
Example: #nron
$%ou cannot control the atoms within a nuclear fusion
reaction& 'eallow people to go in which ever direction that
they want to go& (ndthey)re incented to do all the steps of
innovation themselves& (ndaround that we put broad risk*reward
controls&+ , Ken -ice#nron Capital . Trade -esources
Unleash entrepreneurial energy in a concentrated mixture of
talent, ideas and resources
Unleash entrepreneurial energy in a concentrated mixture of
talent, ideas and resources
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The /ertile /ield
Key Levers
0anage the overall portfolio of core competencies and
strategicassets
1ring people together across organi"ational boundaries to
shareinformation and discover opportunities
Create mechanisms that gather disseminate and track new ideasand
learnings for all employees
2etermine when and if to spin off a growing business
Examples
#merson #lectric 34rowth 5rocess6
-oyal 2utch78hell 34amechanger6
Lucent Technologies
Cultivate and harvest a rich portfolio of strategic assets
and
core competencies
Cultivate and harvest a rich portfolio of strategic assets
and
core competencies
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The 8piral 8taircase
Key Levers
Create a profound sense of core purpose
Let everyone know their innovation contribution is important
4ive teams the leadership and autonomy they need to win
Create a culture of experimentation and commitment to learn
Examples
Charles 8chwab
1ritish (irways
(llstate 31V5 5rocess6
Continuously improve and innovate in the core !usiness
Continuously improve and innovate in the core !usiness
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The 5ac0an
Key Levers
Use strategic intent to guide the entrance into new markets
and
development of new competencies 2evelop alternatives early in
the innovation process
Take stakes in promising start*ups using the market as
ascreen
(ssess competitive responses to strategy innovations
Examples:
Cisco
0icrosoft 'orldCom
#c$uire successful innovators and integrate competencies
into existing !usinesses
#c$uire successful innovators and integrate competencies
into existing !usinesses
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The #xplorer
Key Levers
(spire beyond what seems possible
2esign and carry out effective and low*cost experiments
Use 8trategic Intent to guide the entrance into new markets
anddevelopment of new competencies
#mphasi"e continuous cumulative learning
Examples:
0onsanto 39: years to shift from chemicals to life sciences6
Corning39; years to develop optical fiber6
0otorola 39< years to develop cell phones6
Unleash entrepreneurial energy in a concentrated mixture of
talent, ideas and resources
Unleash entrepreneurial energy in a concentrated mixture of
talent, ideas and resources
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Characteristics of Various Innovation 8tyles
'piral 'taircase
Cauldron
(evelop ne)
rapidly
(evelop ne)
rapidly
*ac+an
#c$uire inmaretplace#c$uire inmaretplace
-ertile -ield
.everageexisting over
time
.everageexisting over
time
Explorer
(evelop
internally
(evelop
internally
/mprove on
existing
!usiness0
/mprove on
existing
!usiness0
Create ne)
!usinesses0
Create ne)
!usinesses0
(o you need ne)
assets and
competencies0
(o you need ne)
assets and
competencies0
o) can you !est
develop ne) assets
and competencies0
o) can you !est
develop ne) assets
and competencies0
o) )ell defined is
the opportunity and
ho) long )ill it
tae0
o) )ell defined is
the opportunity and
ho) long )ill it
tae0
ear term )ith
defined
maret0
ear term )ith
defined
maret0
.ong term )ith
undefined
maret
.ong term )ith
undefined
maret
/s the primary focus to/s the primary focus to
