I’ve been working with innovation for most of my career. This includes vision projects, strategic initiatives, innovation networks, mountain bets and moonshots. Even my masters thesis was about the role of innovation in large companies. And I have a confession to make:

In established companies, innovation is a dirty word. Anyone who isn't part of the exclusive group that works with innovation sees innovation as an endless money pit. From their vantage point it is easy to find proof points for this impression, too. If one were to measure the return on investment of innovation projects, the “money pit” reputation would hold up.

Whenever an initiative is called “innovation”, its chances of survival in the corporate environment decreases dramatically.

In contrast, the word innovation almost does not exist in the internal vocabulary of a startup. Because it is what a startup does. All day. Every day. Non stop. A startup exists only to innovate.

Then, why is it so that the word innovation got such a bad rep in so many large corporations? Let's dive in.

Inclusion

When innovation seems to be happening behind closed doors, the people outside will resent being excluded from all the fun.

Many companies are under the (very wrong) impression that innovation is a specialty. That it is a noun. When in fact it is very much a verb and a collective activity.

Scaling vs Learning

The enterprise thinks - and yes, I consider the large company as a living breathing organism - that the absolute measure of success for innovation initiatives is going to market as soon as possible. And making a lot of "new" money in the process.

In reality, the main purpose of innovation is learning. The road to revenue is oblique and any innovator that pushes their luck towards immediate profits will have to face the same issues any other ordinary initiative faces. Moreover, making new money is the most romantic and unrealistic view of innovation. Enhancing the brand, lowering costs, and decreasing employee frustration are all very possible and maybe much more valuable outcomes of innovation projects.

Predictability

All management teams are inherently afraid of making wrong decisions but more often they are afraid of uncertainty. There is always a desire for predictability and safety for each cent spent.

Experimentation gives each future a tangible view in the now.

Innovation is seen as the riskiest activity a company performs and usually is the first to be cut when times get tough. It is seen as the antithesis to predictability. Although, when used correctly, innovation is the only way to decrease uncertainty. Experimentation gives each future a tangible view in the now. It has the power to make murky waters clear up at least for a small amount of time or aperture with minimum investment. These small experiments compound over time.

Upfront Costs

Many innovation initiatives for large companies resemble building the Noah's Ark as a project. There is usually a Noah at the helm who alarms enough executives about a coming flood. The anticipated disaster almost always is a competitive threat due to emerging tech which always seem to have a very real deadline. The Noah makes a substantial budget request with a substantial promise signed in blood.

When such an innovation project gets financed, it becomes a force in itself. It is not uncommon for the Noah to find a new office building, possibly in a new shiny city, with a lot of juicy benefits to new employees complete with bean bags. It is unfortunately all too common that the disaster comes in a form completely different from the flood. Somehow the ark never seems to finish and more and more funding is needed without anything floating on water.

But wouldn't it be better if we were to build a lot of smaller ships? Ones that could be used to fish in case the flood doesn't come?

Overcoming hurdles

It's no wonder that innovation is earned a reputation as a dirty word among upper management and operational parts of the organization. But it doesn't have to be this way. If you want to foster true innovation in your organization, here are some antidotes:

Make innovation inclusive

Everyone can innovate. Consider how you are excluding some of the best minds in your organization when you lock innovation behind closed doors. Oxygen is the best fuel for ideas. Let as many people get a taste of innovating as possible. Make them come up with ideas that make their current product or service better. Let your managers say "You're not only allowed to innovate, you're expected to". Make innovation networks and events commonplace where people who are interested and energized meet each other and share their experiences.

Let innovation be about boring topics

Leave behind the romantic view of innovation. The reality is messy and difficult. Innovation is not only about playing catch up with your competitors on the open market. It is also about decreasing costs of your internal processes. Finding lost boxes in a warehouse does not sound all that exciting but it's surely worthy of true innovation. Let your innovators solve old but tough problems in new ways.

Empower innovation to decrease uncertainty

Instead of expecting every innovation initiative to go to production, create incentives for sharing the learnings - the good and the bad - as wide as possible. Instead of obsessing with the innovation horizons and ROI, obsess with using smaller initiatives to make your future bets safer. Find the riskiest assumptions that operational teams have, find and eliminate the taboos. Find creative ways to spend the least amount of effort to test the maximum number of assumptions.

Most of my professional life, I have worked with innovation but I rarely had a job title with the word innovation in it. And it is not by accident. I can imagine many creative minds out there that would dream about working with innovation and many senior professionals avoiding any association with the word innovation. My two cents to all innovators out there: Be careful about calling your initiative innovation. And to all the managers out there, let's create environments where everyone can innovate - whatever we call it.