Guest Post by: Ariba Jahan (Mentee, Session 4, The Product Mentor) [Paired with Mentor, James Alexander]
Innovation Labs are popping up everywhere nowadays, from Westwood, ATT to Lowe’s, New York Times, and Zappos. It’s like they all read the “Innovator’s Dilemma” and had a panic attack. They realized that all they were doing was creating “sustaining innovations” whereas they need to start focusing on “disruptions” to capture new markets. Disrupt before someone else disrupts you, as the saying goes?
What does a disruption look like? Netflix put video stores out of business by changing how people watch movies. Amazon put book stores out of business by changing how people buy books. Warby Parker changed the entire process of how someone buys prescription glasses and made it affordable. Disruptions can reshape a an entire industry: long distance calls (Skype), record stores (iTunes), local stores (eBay), taxis (uber) and even newspapers (twitter). These companies didn’t become the game changer overnight, it happened over successive iterations and risks that lead to the point where they dominated the customer base.
So companies started building innovation labs to start focusing on creating their own disruptions. Fantastic! This is actually a great thing. But coming to this decision is the easiest part. The execution and implementation are the hardest. So what makes an innovation lab successful? Let’s take a look at some common patterns of their success. Please note, I am not able to disclose the names of the companies to maintain their privacy.
1. Permission and budget to fail.
Innovation is a numbers game. So in order for the team to land on something truly innovative that can be tested and rolled out, they need the room to push out a large volume of ideas that may not work. To support this effort, sufficient budget and resources are needed to turn ideas into prototypes that can be tested. This can help drive an overall culture of “failing forward”. When creative and unique ideas are explored, allow the team to share their learnings from fails and successes openly. The lessons can also be shared publicly as a form of thought leadership and showcase of work.
2. Give Autonomy.
The team should have the autonomy to make their own decisions outside of the main business processes in order to continuously ideate, experiment, prototype and test. The entire company’s process of work doesn’t need to be revamped, but create a way to work outside of the process in order to ideate and prototype large volumes of new ideas or fresh thinking. In order to cultivate this unique energy and process, the team needs to be in a separate space and have access to resources and tools that would be helpful for them to produce quicker. This allows them to focus on the challenge at hand without having to deal with the account/client management/admin work. The physical space the team works in should be inspiring and help the company use it as a space to break out of normal protocols and experiment. The space can be inviting and open to the entire company to visit so that the innovative ideas permeate through the entire company.
3.Leverage the experts.
Pull in expertise outside of the company that can openly share how they innovate. Company B partnered with a consultant firm for design thinking and company D hired a consultancy to build their entire strategy. When selecting, choose expertise that will be invested in getting to know your company and its language. Outside perspectives help adoption and openness.
4. Make it happen company wide.
In order to get buy-in from employees, there needs to be employee education and engagement with the lab, rather than limiting innovation to something exclusive to the lab space and staff. Everyone should be innovating in their everyday work, whether or not they are working directly in the lab or not. However, to encourage this, employees need education, engagement, and incentives.
5. Always be measuring.
It’s important to measure the number of projects and people that have gone through the lab. However, it is also important to evaluate employee experiences in the lab (e.g. “Did you stretch?” “Was it worthwhile?”). Did you deliver a proof of concept? How do people feel about the lab and their participation? The lab should not have to worry about generating revenue or be too focused on the quantitative success. It should be about testing ideas and learning from those experiences. The products and ideas that result from this approach can generate revenue, if the problem solving service is provided to clients.
In order for innovation to be successful at your company, you have to prioritize creating an innovative culture by allowing the entire company to participate in some way, they should feel like they have the permission to fail and experiment for the greater good of the company. Whether a company decides to have a studio, lab or a strategy, it should have a systematic process that allows the team to execute ideas into testable prototypes fast. The work from the lab can be leveraged to create new business, thought leadership and possibly shift the company into transformative innovations. Innovation won’t happen overnight, matter of fact it may take years and failed attempts before the lab can generate revenue or successful innovations, but when it does the impact can be exponential.
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The Product Guy