Innovation blah blah blah. Books, podcasts, conferences, Ted Talks … There’s an entire industry dedicated to telling you why and how to innovate, offering fool-proof innovation strategies and secret sauces. It’s a lot. No wonder innovation fatigue is setting in. Frazer Bennett, Chief Innovation Officer at PA Consulting, warns that “much of this talk of innovation tends to be anything but innovative—and has sent even the most ardent innovators to sleep.”
In uncertain times—and we don’t have to innumerate the uncertainties of the moment—organizations have a tendency to hunker down and focus on short-term stability or even survival. The first victims of this short-termism are innovation and the passion to deliver it. And the first signs of an innovation slump are here.
The Economist has argued that short-term crisis management has taken precedent over long-term innovation. Certainly, the appetite among larger players to pay for the ideas and IP of innovative startups seems to be shrinking. Last year, according to the Economist, “rich-world” spending on intellectual property products was running below pre-pandemic levels at $3 trillion a year. Global mergers and acquisitions activity sank to its lowest level in over a decade in the first quarter of 2023. Meanwhile, data from the US and Patent Trademark Office shows although the number of registered patents in the US more than doubled between 2000 and 2019, it has since slipped into reverse gear.
Bennett insists that this is exactly the right time to keep investing in and fostering innovation—to “double down”, you might say. And the organizations that will go on to thrive are those that radically rethink the ways they are delivering innovation—not scale down or even give up on it entirely.
“If you’re tired of innovation, then you’re tired of success, of brilliant new ideas, and of better ways of doing things,” he says. “So in reality, you’re most likely not tired of innovation, but of the type of innovation you’re attempting to deliver, and the way you go about delivering it.”
The Breakthrough Brigade
Of course, there are still business leaders fostering and scaling audacious, transformational ideas. Bennett calls them the Breakthrough Brigade. PA interviewed C-suite decision-makers at large enterprises across multiple countries and identified a clear split between organizations that focus on incremental innovation (if at all), and those that leapfrog their rivals through breakthrough innovation. This latter group bring ideas to market faster, achieve the highest ROI, and continually seek new opportunities.
Take Rimac Automobili, founded by Mate Rimac. In 2009, the 21-year-old Bosnian-born car and electronics enthusiast living in Croatia bought a 25-year-old BMW and built an electric engine to put in it. He took the car racing and was soon winning. Now, at just 35, Mate Rimac’s Rimac Automobili provides electric powertrain tech to Aston Martin, Porsche, Jaguar, Hyundai, Mercedes, Jaguar and more, with the company now valued at £2 billion (Rimac worked on the electric Jaguar E-type in which Megan and Harry sharply exited their wedding ceremony).
The company builds its own electric Nevera hypercar, yours for £2 million, while also developing self-driving taxis. Rimac insists that shared ownership and autonomous vehicles are the future of the car industry. He also runs an eBike company. Oh—and he’s now CEO of Bugatti.
Of course, it’s not just spirited startups that can do disruptive innovation. Microsoft is leading the way in the application of generative AI to our workaday tools, promising a profound liberation from routine, drudgery, and email sludge.
If you want to be part of the Breakthrough Brigade and reignite your passion for innovation, PA’s research revealed five key behaviors that help organizations break away from the tired tropes of innovation, raise the levels of ambition, and deliver results.
Dare to be a breakthrough growth leader
Organizations reflect their leaders. And bold organizations have bold leaders. When they don’t, employees take note. One third of respondents from different industry sectors in the PA survey said that leaders in their organizations lack the vision and passion needed to make breakthrough innovation happen, while one fifth said leadership vision and commitment was a barrier to delivering breakthrough innovation.
By modeling the behaviors they want to see, leaders can spearhead breakthrough innovation. This means breaking rules and norms, and being prepared to take risks that might not always pay off. Breakthrough Brigade leaders build buy-in across the organization by championing new ideas.
“If we are to foster and nurture the sort of culture of innovation that we’ve invested in so heavily and not stifle it, elite leaders are going to have to explicitly wear that on their sleeve,” says Bennett. “And they do that through their behaviors. It’s what they do, not just what they say. It means working with innovators, empowering people, and giving them space to innovate. Such behaviors evidence to others in an organization that it is safe to work this way.”
Daring leaders are also prepared to lean into the opportunities offered by the latest technologies in surprising ways—so long as they deliver the right outcome. In the UK National Health Service (NHS), artificial intelligence (AI) is being used to predict when people might miss appointments and offer back-up bookings. The new system is anticipated to predict attendance with 90 percent accuracy, with the potential to hugely impact the £1.2 billion yearly cost to the health service of “did not attends”.
Invest in experimentation
Not every breakthrough idea is going to work out. But Breakthrough Brigade organizations fail fast and recover quickly, adapting their approach as required. Brave leaders also create environments that can spur and encourage experimentation—where the build-test-learn cycle is lean enough to reduce costs and gain the momentum to deliver results.
When people feel psychologically safe, they have the confidence and security to pursue breakthrough innovation without fear. They understand that failure is an opportunity to learn and improve.
Bennett insists that large organizations are just as, if not better, equipped to create that kind of innovation safe space as lean, mean startups. They have the talent, the experience, the data, and the resources to ensure that their collective learnings and experiments can translate into success. Take Unilever, for instance. With an experimental mindset and a “data laboratory” approach, it has developed the first true-red vegan lipstick using a replacement for the vibrant red of carmine for consumers through its Hourglass brand.
“There’s a misconception that large incumbents can’t be disruptive or innovative,” says Bennett. “But they are ideally positioned, with both the insights and investment needed for experimentation. Large organizations overlook the real assets that they have. They get bogged down in the things they see as blockers to innovation and overlook the things that are real catalysts for innovation.”
Ready your rebels
Every organization has rebels. They are the fresh thinkers, the ideators, the people who ask “why?” and “how?” These “corporate explorers” as they have been dubbed, challenge accepted norms, question embedded processes, and play devil’s advocate in a productive and positive way.
Krisztian Kurtisz was a manager at the Hungarian outpost of the 200-year-old Austrian insurance company UNIQA when he proposed a radical new business model to his CEO. Kurtisz wanted to apply the algorithm-driven logic and delight of Spotify to insurance. His bosses backed him in creating an internal startup and the result, CHERRISK, is now rolling out across Eastern and Central Europe.
Most organizations are not rebel friendly—and culture plays a significant role. PA’s research into the barriers to breakthrough innovation found that over a fifth (21 percent) of respondents felt they were held back by their company culture. Breakthrough Brigade organizations develop cultures that mix and match diverse teams and support collaboration and constructive rebellion.
“To activate your outliers, develop a really strong culture that celebrates rebels,” says Bennett. “Rebels will be most attracted to organizations where they feel their voice will be heard and valued. They look for empowering leaders, and a clear, meaningful organizational purpose. And organizations need square pegs for all their round holes.”
If you want to attract rebel talent, young or old, you have to rethink recruitment and onboarding. Realizing the potential of both new and existing rebels can be achieved through internal workshops, sprints, forums, and feedback channels.
Experimental side-projects can also be a way of introducing your organization to radical side-ways thinking. The trick, though, is not to simply outsource this kind of rebel thinking, but to use these projects to shift your own cultures and open up space for in-house rebels.
Rebellious thinking brings unexpected outcomes. The Center for Regenerative Design and Collaboration (CRDC) is an international disruptive building-materials company that creates appreciating value from the world’s plastic waste. With operations in multiple countries including Costa Rica, the US, South Africa, and Australia, it is focused on transforming environmentally harmful waste plastic into an additive that can be used in the production of low-carbon concrete, directly addressing two of the world’s biggest environmental challenges. PA is working with CRDC to better understand the science of their system—how concrete and plastics integrate, and the mechanism of carbon capture in the product.
Combining CRDC’s understanding of concrete and engineering with PA’s scientific knowledge and test facilities, the new process is currently being optimized ahead of a move towards an industrialization and commercialization phase. Eventually, the goal is to create a scalable system and define an optimum business strategy for global launch.
PA innovation and manufacturing expert Ruan Jones explains: “CRDC is simultaneously taking on two significant environmental challenges and addressing them in a way that is relevant to both developed and developing markets. They are creating an ecosystem that embraces a new value stream for non-recyclable waste plastics, and uses materials that would previously have gone to landfill or incineration in a manner that has the potential to significantly reduce the carbon footprint of concrete.”
Build an innovation engine
Scaling and taking great ideas from concept to market, and doing it over and over again, requires an internal innovation engine. How internal that engine needs to be can vary. You can embed it within the organization or have it sit outside in a “hub” or “skunkworks”. One thing you can’t do with it, says Bennett, is stick it in a sealed black box, point at it, and say “look, we do innovation”.
“If you walk into an organization and there’s a room that says ‘innovation’ on top of the door, your heart sinks,” he says. “Innovation is not a department, it’s a mindset. It’s a frame of mind and it permeates through the whole organization.”
It begins, says Bennett, with a kind of auto-disruption. “I tell people you can innovate by automating chunks of what you do and just thinking about how you can make what you do better. And by succession planning, bringing on the next generation. Start by being disruptive in your own organization.”
Innovation engines should also bring together a diverse, expert team with a wide range of skills and capabilities.
“Diversity and dissonance are two big drivers of innovation,” says Bennett. “And there’s good science and evidence to back that up. When you get people with differing points of view or different perspectives on a challenge together, that’s when the magic happens.”
PA’s Global Innovation and Technology Centre (GITC) gathers technological, strategic, and production capabilities under one roof, providing a fully equipped hub where concepts can be tested and trialled.
PulPac, a revolutionary circular packaging company, is preparing its patented Dry Molded Fiber product for market alongside technology and design experts at the GITC. The solution is sustainable, scalable, and offers a low-cost replacement for plastic. And it’s currently at the centre of the Blister Pack Collective, which brings together brand partners dedicated to eliminate or minimise the use of plastics in over-the-counter prescription drugs and nutraceuticals. Another example is Dizzie, which is helping retailers and brands to make the transition from single-use to reusable packaging. In the case of Dizzie, the innovation engine was an entire innovation eco-system, and required an understanding of the needs right across the end-to-end supply chain: Not just retailers, but pickers and packers in the warehouse, delivery and return drivers, plus the needs of those cleaning reusable packaging, too.
Elsewhere, the Eye in the Sky initiative, run as part of Ofgem’s Strategic Innovation Fund with Innovate UK and National Grid, alongside the European Space Agency, Cranfield University, and a wider range of partners, is using space technology and satellites to boost the resilience of energy networks against the impacts of climate change. The program has the potential to deliver up to £22 million in cost savings over a decade, while also providing better energy system recovery, and better grid reliability.
Nail the idea, scale the idea
Scaling is the most important and difficult aspect of breakthrough innovation. The move-fast-and-break-things mantra and the cult of the minimum viable product has led to the premature release of too many ill-considered and under-cooked goods and services.
Breakthrough Brigade organizations get the idea right through experiments, testing, and fully understanding the question the breakthrough idea will solve. Once the idea is fully scrutinized and ready for market, scale will take care of itself.
“If you read the history of WhatsApp, they invested hugely in creating the most delightful experience for what was basically a completely commoditized thing—messaging chat,” says Bennett. “And they did it before launch.”
In products that combine the physical and digital, understanding what problem it solves, how it does it, and how it can do it at scale are crucial to nail before launch. That is the approach PA took in partnership with Cumulus Neuroscience in creating a medical-grade electroencephalogram (EEG) monitoring platform to record the brain activity of patients with neurodegenerative and neuropsychiatric diseases. The partnership was set on creating a headset that was comfortable to wear, humanized, and which softened a frightening technology, enabling it to be used easily at home—and it had to be produced at scale.
Melanie Turieo, who leads PA’s Health and Life Sciences, Product Development business, explains that while it’s tempting to press ahead, ensuring you are answering the right question first will increase the reach and impact of breakthrough innovations.
“There’s huge pressure to move quickly,” she says. “But, in complex environments like healthcare and life sciences, there’s a complex ecosystem of stakeholders with different wants, needs, and priorities.”
“When introducing a new change, it’s critical to define the value proposition up front for each of these stakeholders, and consider the effect across the entire ecosystem,” adds Turieo. “You prepare for that change as much as possible by bringing stakeholders along on the journey, introducing them into the process early, and protecting the value vision throughout the turbulence of implementation and realization.”
The five key behaviors of the Breakthrough Brigade can be replicated across all industries and organizations, from startups to established powers. It’s not an easy or instant fix. It requires flexible, inspiring, and risk- and rebel-friendly management at all levels. It can mean massive cultural shift and looking for smart ways to network innovation drivers across an organization. But as Bennett says, innovation is where success and smart ideas live. If innovation is dead, then long live breakthrough innovation.
Technology has the potential to answer many of the world’s toughest challenges, but it requires human ingenuity to unleash it. PA Consulting, in partnership with WIRED, shares insights on how visionary leadership can help deliver life-changing technology and innovation.
This article was originally published by WIRED UK
