Is Your Innovation Program A Failure Because It Didn’t Produce a Unicorn?
I was at an innovation outpost event (innovation “outposts,” in their definition, are offices that companies who are not based in Silicon Valley have in Silicon Valley so that they can breathe the heady, heady vapors of the innovation brewing out here) a few weeks ago where the presenter made a very interesting remark. That remark stayed with me, and now I seem to be hearing references to it over and over with regard to the expected outcome of an enterprise innovation program, which I’ve blogged about before. I think that he made up the remark on the fly during his talk, and at first, I thought he might be just being facetious, but as I hear more and more people use it, I’m thinking that may not be the case.
That remark was:
It’s not innovation unless it’s a billion dollar business.
He was referring, I thought jokingly, to the output of an internal innovation initiative. A billion-dollar business, otherwise known as a “unicorn,” is called that simply because it’s typically pretty rare, although if you read the startup news, it seems like there’s a new one born every minute, and they are being born faster and faster. Of the last few unicorns (the eCommerce site Jet.com among them), some made it to billion-dollar status within four months! But that’s the startup world.
So now it sounds like leaders of enterprises are now looking at those companies and using that as a yardstick for the success (or failure) of their internal innovation initiatives. I’ve heard a number of times now that when leaders launch internal crowdsourced innovation programs, they not only ask for the employees to come up with the enterprise’s next “billion dollar business,” they expect it. Apparently, even large enterprises think that innovation needs to be insanely profitable (although not particularly massively huge, game-changing, or disruptive since that may be a threat to the business) – even enterprise leaders want unicorns to call their own. (Why not, they are so cute, aren’t they?)
In all seriousness, if the yardstick of success for an innovation program is nothing less than a billion-dollar business, then what kinds of innovation are you really going to see? If we only look at the pure bottom line, how will we get out from under the “how can we make things way more profitable” mindset. Sure, the business of business is making money – however, if you focus on that above all, who knows what amazing innovations you will leave on the table. Who knows what incremental products, process improvements, and other micro innovations are just being tossed by the wayside because they are too small. A thousand incremental innovations could lead to multiple unicorns, but if you only go for hitting it out of the park, you’ll forget that base hits and walks count too.
Sure – set your sights high. But don’t expect every idea to be a hit. You’ll probably never know which one will. Like a good VC, play a lot of small bets, and if you get lucky, and let your people be as innovative as they can be, then the home runs will come.