With Telstra recently named as the number one corporate innovator in Australia by the Australian Private Equity & Venture Capital Association, our Director of Innovation reflects on the challenges of driving innovation within a large organisation.
Two of the most common questions I’m asked as Head of Innovation is how do you measure success? How do you know if what you’re doing actually drives innovation?
Fortunately I have an answer for that. And it’s one that involves numbers and metrics. And words like customer experience, time to market, product market fit and cost avoidance. You get the idea.
But there is another way to track progress. And it’s by observing the mindset and language used by the people you are working with. It may not be as scientific, data driven or measurable, but it’s simple, indicative and extremely important.
Here are some things to look out for that indicate you’re on the right track:
- People ask more questions than provide answers
- They formulate hypotheses, then go and test them
- They always start with a customer problem – what are we trying to solve? (even when we’re talking about a very cool technology)
- They iterate fast and constantly test with customers
- They adapt/ change based on customer feedback
These can be summed up by the term ‘entrepreneurial management’. But why is an entrepreneurial approach important for a corporate? We’re far from being a startup!
Eric Ries (father of the Lean Start-up movement), describes Entrepreneurial Management as ‘a separate branch of management that deals specifically with those conditions of extreme uncertainty’. That’s exactly what businesses are facing now with digital disruption, whether they are startups or well-established corporates. Reis argues that traditional forecasting only works in a stable and predictable environment and asks us “who feels like the world is getting more and more stable every day?”
So why is adopting entrepreneurial management techniques so important in driving innovation?
If you’re looking to achieve sustaining and incremental product innovation, it probably isn’t. But if your goal is transformational or disruptive innovation (such as setting up an entirely new business or using emerging technology to transform your business model) that’s when the uncertainty comes in and with it a need to manage it in a very different way.
We have learnt through our own innovation journey that ideation is actually the easy part. Executing on the ideas well is much harder. It requires a structured approach, with a consistent set of tools and a different mindset to drive those ideas through to implementation (or kill them early!).
It is a journey and the end goals may be very ambitious, but in the spirit of celebrating small wins, I always take great encouragement when I hear people in the organisation say ‘I have a hypothesis, let’s go test it!’ as I know we are making progress.