The corporate innovation space is booming. Companies are setting up new innovation offices, incubators, or accelerators, and hundreds of internal and external hackathons are being organized around the world. Facebook has organized more than 50 hackathons to support innovation within the company since its beginnings. So, its no wonder that this trend has opened the market for a new breed of consultants dedicated to innovation. Are innovation consultants truly contributing to higher levels of success and does your company need one too?
There is no doubt that every successful company has innovation written in its DNA. Look at Tesla, Salesforce, Adobe, or Dropbox. It is impossible to sell products on the market that don’t correspond to customer needs, market trends, or technology development. Some companies such as Kodak or Toys R Us, after becoming market leaders, fail to keep up the pace in one or more areas, lose the entrepreneurial spirit they once had, and eventually lose their customers and die. Innovation consultants are here to bring corporations back on track and up to speed.
5 Reasons Why Corporations Should Hire Innovation Consultants
Some corporations have mastered the art of creating and supporting innovative culture and processes in the whole company; some have set up a proprietary department for innovation that leads the innovation efforts; and others have sought external help from innovation consultants as a substitute to internal innovation.
Who is doing it right and who is doing it wrong? Here are five basic challenges that corporations encounter during their innovation efforts and five approaches that suggest how external innovation consultants can help.
1. You are in early stages of innovation
Being a beginner in innovation is tough. Innovation initiatives need time make it to the stage of a minimum viable product. As an innovation manager in a corporation, you are fighting for financial and human resources, and all eyes are on you.
Innovation consultants know that you need quick results and success stories. They can help you narrow down the scope of your challenge, set milestones and goals for the project, as well as, criteria that measure the impact on the product line, employees, finance, and the company as whole. A consultant can quickly assess what your innovation status is, how well you’ve formulated your pain points, and how well you know the market. Then, they guide you through specific steps to show you how to get up to speed and eventually, innovate yourself.
There are several prerequisites making such an engagement successful:
- Mission and vision: If your company is missing one or both it likely doesn’t incline to innovation. Define them before engaging in innovation activities. Patagonia, American Express, or IKEA can serve as a great inspiration.
- Executive buy in: Without this, it is only your pet project.
- Basic innovation culture: If your company is risk averse, doesn’t allow failure, and leadership focuses only on profit, you have to build the innovation momentum first. People should learn how to bring innovative ideas to the table every day. Like at Intuit:
2. Your R&D team is your company's only innovation department
Many technology companies claim that they have always had an innovation department because they have R&D. This is not entirely true, as in many cases, the whole R&D office is full of scientists with little or no external context. Often, it is hard to remind them that they shouldn’t forget about the customer while bringing the latest technology to life.
Innovation consultants can help you draw the attention to external innovation resources, such as startups or innovation platforms, that focus not only on highly specific technical issues but also on the broader business, social, financial, and environmental implications of various trends.
However, consultants will not set up innovation processes in your company. If you want to improve operations and internal processes leading to innovation, you need strategic consultants that will focus on the company structure, communication tools, and process optimization.
3. You are lost in the sea of opportunity
The innovation ecosystem is steadily growing with various players and possibilities. The question is where to begin:
- Inspire! The easiest, albeit not the most efficient way, is to attend innovation conferences and events for inspiration. They will give you an idea of what your future options are and you can become a member of a specialized innovation platform like Catalyst Companies.
Source: The five corporate innovation models by Catalyst Companies, http://www.catalystcompanies.co/blog/
- Create! The second best option is to become a sponsor of an accelerator where you get to meet innovative companies specialized in your industry, and you can select which startups you are going to engage with and how like at 500 Startups or Plug and Play.
- Consult! The third and most advanced option is to hire consultants. Great innovation consultants will provide a tailored selection of innovation resources that are adequate to your innovation needs, budget, maturity, and ambitions. There are many types out there focused on design like Ideo or technology like RocketSpace.
The bare minimum that you will need to know before engaging with an innovation agency is what you are trying to accomplish, who is on your team, and what your budget is. You will also want to determine whether you want to find inspiration for your new product or service, partners for product development, ways to build an internal incubator, or companies to invest in.
4. Startup engagement guidebook, anyone?
Working with a startup is not a business partnership like any other in which the usual processes can be applied. Startups do not operate as corporations, and that’s one of the reasons corporations partner with startups.
The most cited reason for a startup and corporate partnership is the mutually beneficial relationship in which the startup brings the entrepreneurial spirit (that the corporation lost while growing), the speed (that the corporation cannot achieve due to complexity of processes), and expertise, while the corporation brings the business experience, scalability opportunity, and the financial backing.
There are a number of steps needed to ensure that both sides benefit from the partnership. Quality consulting companies make a detailed assessment of the corporate and startup opportunities, needs, and challenges; and, then they recommend the next steps, timeline, and guidance on how to communicate and what to expect from each other.
5. You are lacking tangible innovation results
Some corporate innovation offices have a whole portfolio of initiatives, but they don’t have any short term results that they can present to management which puts their existence in risk. There are several ways innovation consultants can help you:
- Navigate in the sea of opportunities. A good consultancy is able to help you define short term and long term priorities and goals. They will help you answer the question of how and where to start and focus first.
- Tailored recommendations. They will support you in your goals and make sure they correspond to the company culture. They will also provide tools, numbers, and facts that support your cause.
- Balance between short and long term projects. Consultants can help you prioritize and set goals for projects that can be successful faster and projects that take longer but have more impact and scalability.
To hire or not to hire innovation consultants
Innovation is a complex process that requires innovation leaders to connect many dots inside and outside of the company. They need an innovation mindset, executive buy in, patience, and luck. External innovation consultants can support the leaders but can never do the job for them.
RocketSpace works with global industry leaders who find themselves in challenging conditions. The San Francisco based consultancy provides these corporations with innovation strategies assessing their short and long term challenges and opportunities, recommending top areas of interest, and providing guidance in the technology startups ecosystem. They deliver tailored solutions and set up corporate startup partnerships based on mutually beneficial relations. Their main advantage is the combination of external innovation expertise drawn from a wide spectrum of industries, emerging technology access, through an established global startup network, and the focus on actionable solutions that allows innovation leaders to execute on the proposed strategy rather than keeping it well stacked in their library.
But, their expertise by no means covers the innovation ecosystem; so, go out and look for your innovation consultancy. It is highly likely that you will find a suitable one if you do your homework first.