Bootstrap Your Corporate Innovation18 May, 2018 / Articles
How do you set up your innovation program?
If you are reading this article, you have probably already struggled with this question. Should you set an idea funnel first or hire a cloud/blockchain/artificial intelligence (AI) expert? Should you try to change the culture or develop an innovation strategy with financial goals?
You also know the startup mantras — fail fast, disrupt yourself, move fast and break things — but these don’t give you specific guidance on what to do tomorrow.
In this article, I’ll show you a simple framework of four elements for bootstrapping and describe the components and the flows between them. Hopefully, it will help you frame your innovation process and set expectations for your leadership.
The basic idea is to start with what you have and design a solution for today’s market. If you are currently building an innovation center, you probably have a lot of obsolete products and resources, but between them, you have some nuggets of gold. Use these nuggets as anchor points to build solutions for the current market. Once your innovation capabilities mature, you can expand your horizons to more advanced goals.
Here is what you need in the beginning:
These are the assets giving differentiation to your products which only you can provide. This is what they look like:
You need to identify strategic assets that will give you an unfair advantage. These could be patented activities and materials, know-how, excess capacity, surplus or exclusive suppliers. You need a non-trivial advantage that gives the innovation a better chance of succeeding in the market.
Those resources should be readily available in substantial quantities without the need for a new capital investment. In the ideal case, the new solution should only add the cost of materials. Make sure that these assets are still unique and not already commoditized.
Under Your Control
Make sure you have control over the asset. Once you prove its value, your competitors will quickly try to copy you. If you don’t have the excess capacity for the exploration phase, you can borrow from another vendor until the idea is validated, but be careful that your interests are protected.
Without a unique asset, your new product will be just as everyone else’s with a minimal chance of success. You will be competing against players with better knowledge of the market and faster execution. Every new product should be anchored to unique assets. In time, the new product can become a unique asset itself and be a base for future innovation. Look at how Amazon used their existing cloud to serve new needs or how Kindle connected existing books and readers.
You have to always develop or acquire new unique assets and gradually discard the commoditized ones.