How to innovate effectively in established organizations

Established firms have it all: the structure, people, and proven methods that help the machine stay greased.

However, these elements can also lock an organization into a rigid monotony. Tim Kastelle, a lecturer of Innovation Management at the University of Queensland Business School, believes that innovating effectively within established firms is challenging because legacy business cultures lack a definition and common language for innovation.

It’s not impossible to overcome; in some cases businesses simply lack the know-how to loose themselves from rote paradigms. By admitting these paradigms exist and calling them out, organizations can break from old molds and engage in innovation.

To start, make sure you understand your operations.

“If you don’t have a handle on your current business model, then you can’t build on those models,” Kastelle says. This can pose a constraint problem if your innovative idea disrupts the norm.

Next, create a definition for innovation in your company and make sure everyone understands that definition. By unifying the innovation vision, employees will understand expectations.

That vision must include all aspects of your innovation approach rather than identifying only strategic, game-changing ideas. One company Kastelle worked with focused only on producing big, disruptive ideas, and subsequently neglected putting resources into smaller projects that could produce incremental value. Another company thought only small ideas worked and did not offer up their bigger creative ideas for fear they had almost “too much innovation.” A broad definition of innovation should align with company objectives and be wide enough to develop a full range of ideas, Kastelle said.

He describes innovation as a fundamentally evolutionary process:

  • Variety - being good at coming up with quality ideas
  • Selection - bringing the best ideas to the next level and sufficiently testing them.
  • Replication – getting others to share the vision for an idea

Kastelle says large organizations often approach innovation as a nice-to-have, rather than an embedded process.

“The mistake is thinking about innovation being all about ideas,” he said.

Instead, he recommends finding “ways to experiment quickly and cheaply, scale them up if they work, and prototype rapidly” while providing enough time for people to play with the ideas. Experimentation develops the idea physically, but it also needs to line up with the organization’s overall innovation goals.

Some established companies that already embrace innovation – the 3Ms and Google of the world – enjoyed a culture of innovation from the beginning. Other companies like Toyota and Lego had to innovate to stay alive, and today are thriving and successful.

Innovation will look different in every large organization, and no one formula will work for everyone. Kastelle said creating an innovation process that will easily integrate with the structures you have in place will ensure its longevity and success.