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Too Much Innovation? Can a Company Over-Innovate?

February 6, 2013 15inno 5 Comments

Is it possible for a company to over-innovate? I was asked this question recently by Tom Jantzen.

The simple answer is “Yes”. Companies can over-innovate although I would say that under-innovate is the more likely problem at most companies.

When companies over-innovate, I think we need to look at both internal and external issues.

Internal issues have a lot to do with the thickness of the idea and innovation pipeline within your company. You might have a very strong idea generation process (the front end of innovation), but this does not matter much if you not capable of taking these ideas through the internal system towards the market. Execution is just as important as ideation.

Another internal issue could be whether your executives have the vision to see the full potential in the many ideas or whether they have the guts to move forward with them.

External issues are very much about the market and the industry in which the company operate. Are they even ready for your new innovation?

You should of course still try to bring the innovation to your current markets even though the industry struggles with it at first. Overcoming such initial resistance can help create strong positions, but you should not be naïve and blindsided either. Today, the timing of innovation is much more important than ever and it could very well be that you are too early with your innovation and then it does not really matter how hard you keep pushing it. Then, it is better to stay low with the particular innovation and stay ready to execute once the market is ready.

If you get no traction at all in the current markets, an over-innovating company in a conservative industry should try to turn this into a positive thing by looking at new opportunities in new markets. This could very well be within adjacencies of the current market or industry.

Since innovation today happens with partners, we have to link the internal and external issues. It might be that your internal innovation pipeline is fat enough to accommodate all the innovation your company wants to bring to market, but your external innovation partners might not be as prepared as you are. This should not stop you, but it might slow you down. Here you have to put in an extra effort to bring your current partners up to speed if you decide to stick with them. If not, then you need to find new partners.

I don’t assume many people will disagree that companies can over-innovate, but perhaps you have some different perspectives on why this happens and what companies should do in such cases.

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Currently there are "5 comments" on this Article:

  1. Michael Fruhling says:

    The topic is interesting, Stefan. A lot of companies have too many projects in process, and need to focus more. It isn't that all of these projects will go to market. Some of them are low priority and are making slow progress. However, the point is that some of these projects need to be shut down and resources redeployed. For whatever reasons, many companies have a hard time killing off projects, which would almost certainly permit more efficient use of limited internal resources.

    • Stefan Lindegaard says:

      Agree – I call them zombie-projects. They are living dead that suck out resources that could be used better elsewhere. If you want to you are welcome to share some insights here on this topic and then I will write a post on this mentioning your input.

      • Michael Frühling says:

        Thank you, Stefan. I like the term "zombie projects" because it describes them so well! In my experience, I have found that projects exist in part as a way to maintain relevance, and visibility and to command airtime for scarce management bandwidth and corporate resources. After all, everyone wants to be working on something that management cares about, right? And similarly, management is reticent about killing projects because they don't wish to send negative messages to staff. So, quite often, projects are perpetuated despite their being largely irrelevant.

        One refreshing break from practice was implemented at Bath and Body Works some years ago, when CEO Neil Fiske and his management team agreed that only 8 new projects would receive prioritization and resources. The projects would be decided by their strategic relevance and projected contribution to sales revenue. The departments competed for the 8 slots in a venture capital pitch type fashion (I'm oversimplifying, but you understand my point). After the decision was reached, if a project wasn't among the 8…it was not to be worked nor was it to receive any resources. Painful for some, but many. Obviously, those whose projects didn't make the cut felt vulnerable, but that type of discomfort isn't necessarily a bad thing.

        Best regards,

        Michael

      • Ben Ratje says:

        Zombie Projects. I like this term. I will definitely use it and give credit where credit is due!

  2. Héctor Iglesias says:

    Dear Stefan: I totally agree that most companies under-innovate. Perhaps in many industries ´the financial problems started on 2008, still persist. The only companies that can afford over-innovation are the high tech ones.
    Best regards – Héctor

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