The ten types of corporate innovation programs
Large, established companies are trying on various programs to foster new innovations in an attempt to find the best way to change course for their big ships. These established companies...
Strategy 2: Innovation Center of Excellence
Innovation can’t happen in a single group; without broader institutional digestion, new ideas will falter and fall. Some corporations are setting up cross-functional, multi-disciplinary groups to share knowledge throughout the company. Example: Various retailers and consumer packaged goods companies enable this.
Strategy 3: Intrapreneur Program
Rather than rely solely on external programs, internal employees — dubbed “intrapreneurs” — are given a platform and resources to innovate. These programs invest in employees’ ideas and passions to unlock everything from customer experience improvements to product enhancements and full-blown internal startups that are then launched from within the company.
Example: Adobe’s Kickbox program is widely recognized as the leading program; we’ve documented it here.
Strategy 4: Open Innovation
Hosted Accelerator or Corporate Incubator Hosted inside a corporate office, large corporations invite startups to embed at their physical locations and provide them funding, corporate support, and other perks. This brings innovative startups inside a large company for everything from overnight hackathons to long-term programs. Other variations include online open-innovation programs that request — and often reward — ideas from the crowd.
Example: Allianz Digital Labs in Munich hosts startups, and GE Garages enables startups to partner.
Strategy 5: Innovation Tours
Frequently inspiration comes from outside, not within. Corporate leaders tour innovative organizations, companies, and regions to discover trends in various industries, learn from speakers, meet partners, and be inspired as they immerse themselves in innovation culture.
Example: European-based WDHB and nexxworks tour executives in Silicon Valley and beyond – I’m a frequent speaker at their events.
Strategy 6: Innovation Outpost
A dedicated physical office, such as in Silicon Valley or wherever innovation happens in their market, staffed with corporate innovation professionals whose job is to sense what’s occurring in a market, connect with local startups, and integrate programs back into the corporate HQ. Some of them host partners, events, and startups, thereby spreading the function to Internal Accelerator programs. An Innovation Outpost is typically managed by employees — unlike an External Accelerator, which is run by a third party.
Example: Swisscom, Vodafone, and Nestle have opened Silicon Valley outposts. Read Evangelos Simoudis’ blog for insights.
Strategy 7: External Accelerator
Corporations partner with third-party accelerators to provide sponsorship and/or funding in exchange for relationships with startups and integration opportunities. Corporate innovation professionals often embed themselves in Accelerator offices, fostering relationships with local startups. These External Accelerators are run by third parties — unlike Innovation Outposts, which are managed by employees.
Example: Plug and Play, Singularity University, Rocketplace, Runway, 500 Startups, Betaworks, and more.
Strategy 8: Technology Education, University Partnership
Corporations can tap into new graduates, early-stage projects and companies, and the network of an established educational institution. In addition to traditional universities, there are new private versions opening up that are dedicated solely to technology training, like Galvanize and General Assembly.
Example: General Assembly, Galvanize, and most tech- or business-focused universities.
Strategy 9: Investment
Many corporations place bets among the startup ecosystem, with both small amounts for early-stage startups and larger amounts of corporate funding that yields market data, creates opportunities for follow-on investments, and blocks competitors.
Example: Intel Capital is a leader in direct corporate investments.
Strategy 10: Acquisition
Rather than build innovation from the inside, many corporations acquire successful startups and then integrate. While often expensive, the startup is often already successful, and the acquisition can help the startup scale further.
Example: As one example, Dollar Shave Club was purchased by Unilever for a reported $1B.
In summary, corporations don’t have a one-size-fits-all approach to helping their company activate new ways of doing business. They will deploy multiple forms, at different times, with varying degrees of success.
What’s very interesting is that a majority of these examples are “outside-in” innovation, where companies are drawing knowledge, resources, or expertise from groups outside their own company.
Because most of these programs rely on external innovations, organizational alignment is key to helping companies digest market changes.
Stay tuned on www.web-strategist.com for further insights as we prepare to publish our report on corporate innovation this fall, and please leave a comment if we’ve left out a strategy — or need to modify an existing one.
This guest article first appeared on Jeremiah Owyang's blog.