Google has to be one of those iconic organizations when we talk about innovation. They seem to be spinning off product after product and service after service. So it is only logical that we look at how Google approaches things if we wanted to set up our own organization to be successful at innovation. Unfortunately, you might be dooming your efforts from the get-go that way. Let me explain.
Innovation and change is a dynamic of closely linked variables. If you think about it, innovation is a response to change – an overarching change in the form of a digital trend, for example. That change forces the companies competing in a sector affected by the aforementioned digital trend to react rather quickly or face the consequences of falling behind. At the same time, innovations bring about change. The advent of the smartphone changed the way people communicated with one another. It affected many social behaviors. Those only came about after the innovation was released to the masses. Understanding this relation between innovation and change is key to your approach.
Google is a tech company. This shouldn’t come as news to anybody. It is playing a different game than, say, an industrials company. The environment in which it competes in is different. The rate of change in that environment is quite rapid. But that’s not the case for an industrials company. As a result, the way an industrial company approaches innovation should be different from a tech company like Google. Google can afford to be riskier and have more failed projects in its portfolio (Google Lively, Google Answers, Google Glass, Dodgeball etc.) as a result of the rapid change that the tech space dictates. Its innovation portfolio is intentionally designed that way. One of its most powerful strategies is acquisitions. Nest is a prime example – an expensive one, mind you ($3.2 billion). Again, though, Google has to make those moves. An industrials company, on the other hand, doesn’t have to. The rate of change is undoubtedly not as fast. Consequently, its innovation strategy should be vastly different from Google.
How are you approaching the management of innovation? Are you mistakenly designing your company to be geared towards a sector you’re not competing in? Understand what sector you’re in and the rate of change that governs it. Make sure you set up your innovation resources accordingly.