\Corporate Innovation Opinion/

A former Google and Twitter staffer: this is why corporate innovation isn’t working

Mimicking the surface rituals of innovative companies isn't enough, you need to be asking three deeper questions.

Credit: Woman having fun with a VR headset

By Brendan Kearns

Professor Rita McGrath of Columbia Business School says that we used to think of the competitive environment as a sort of equilibrium with long periods of stability between seismic disruptions. But now things are different. “The disruptions are coming closer and closer together. The competitive environment is in perpetual motion,” says McGrath. She’s right. McKinsey famously reported that the average lifespan of a company in the S&P500 in the late 1950s was 61 years, by 2027, it’s expected to be just 12.

It is no surprise then that big corporates are attempting to remodel themselves to behave more like the four horsemen of the digital apocalypse (Apple, Amazon, Google, and Facebook), which have long been eyed as examples of how to be an innovative business in the 21st century. Even in Silicon Valley, the cultural home of tech, firms have popped up to cater to corporate leaders on pilgrimage to their idea of disruptive Mecca. One such company, aptly named the Silicon Valley Innovation Centre, even offers execs the chance to “breathe it all in alongside the creators, visionaries and engineers who make it happen,” All for just a few grand a pop…

No amount of test drives in a Tesla or getting your picture taken wearing a Hololens will leave you with innovation fairy dust.

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As a former staffer at companies like Google and Twitter, I’ve seen my share of how the sausage is made inside big tech—and I can tell you that no amount of test drives in a Tesla or getting your picture taken wearing a Hololens will leave you with innovation fairy dust. It would be like saying that I can become a professional footballer because I’ve watched some of the best players in the world from a distance.

Prior lockdown in March, I was running a strategy session with a dozen or so executives from a leading telco. We asked meaningful questions, talked about the strengths and weaknesses of the business, had great ideas, and fast approached the moment in the day where we needed to converge on a commitment to take things forward. That’s where it all fell apart.

“We’ll never get approval to run any of these as real projects,” said one product leader.

“We’ve tried to work like this before, and it doesn’t gel with who we are,” said another.

“I’ve not seen it work yet, so I’m cautious about committing any budget,” said the most senior decision-maker.

“I’m not surprised that your competitors are finding it so easy to eat your lunch,” is what I should’ve said. Instead, I stayed silent.

Everyone suddenly became very interested in their email. I wasn’t too disheartened, responses like these are common in response to the need for change inside most incumbent organisations—a sort of logical fallacy that people use to protect themselves from being singled out as the owner of a particular failure.

Innovation can only happen when a failed outcome doesn’t mean failure overall.

From my vantage point, the difference between incumbents and their disruptors is that larger organisations look for certainty from the get-go and usually go all-in on a single bet. Disruptors look for evidence and data to see multiple possibilities and then hit the accelerator on the one with the most promise. In my experience, innovation can only happen when a failed outcome doesn’t mean failure overall. Instead, failure is a lesson to be used across the entire business—the kinds of insights born from leaning head-first into new ways of working as a catalyst for transformation, not just theatrics.

Too many organisations dip their toes in the water and mimic surface-level rituals of their disruptors instead of committing to becoming a more experimental business as a method for survival. Tools like accelerators, labs, and workshops are not a panacea for organisations whose culture is at odds with the reality of transforming a business while being sandwiched between an incumbent mindset and a siege of disruptors nipping at their heels.

Think about it this way. Imagine you’re an investor looking at a shortlist of two companies: The first moves slowly and despite looking like a modern company, it only makes a small number of conservative bets every couple of years. The second is more nimble, and at any one time is running dozens or hundreds of experiments that test different markets, products, and features to see what works and what doesn’t, while also maintaining its current business. Which company would you invest in?

If you aren’t seeking better answers to one of these three questions, then you’re in the innovation entertainment business.

The good news is that you don’t need to add another performance to your innovation bow. In one of my teams at Google, we had three simple questions to guarantee we were focussing on what really mattered:

  • Who is the user (customer)?
  • What problem are we solving?
  • When (or how) will we know that we’ve done it well?

It really doesn’t matter how you figure out the answer. But if your innovation efforts, however fanciful, aren’t seeking better answers to one of these three questions, then I’m afraid you’re in the innovation entertainment business, or worse, playing the fiddle while Rome burns.

There are no guarantees in this line of work, except that the team trying to unseat you is looking for the answers to the same three questions, and I guarantee they’re not doing it by temporarily imitating the fanfare of disruptive culture. They live and breathe it.

Brendan Kearns is the founder of Rival, an agile innovation studio in London.

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Rene Tomova
Rene Tomova

As someone who works at the cross-section of startups and corporates I quite agree with your take. Until fear of experimentation and betting on “tried and tested” solutions is the modus operandi in large companies and their leaders innovation will largely remain “an entertainment business.” The major question that I still haven’t found the answer to, though, is: “How do you break the mould?”. Where do you start? In my professional experience we have started from the top and we have started from the bottom and incumbent culture always wins. So, how do you instil a culture of experimentation in… Read more »

Elvin Turner
Elvin Turner

Nice article Brendan. All sounds very familiar, but as you allude, possible to overcome..:-)