Innovation teams: People who get to waste money for a living
Does your company have an "Innovation" group? Congrats, you're wasting a ton of money and not innovating at all.
If you work at a sizeable company, you might have an “innovation” department. A bunch of people who’s job is apparently to … innovate? Innovate what? Everything? I don’t know, but I can almost guarantee that the entire innovation group is a waste of time and money.
So what’s the big idea?
I have never commissioned the creation of a innovation department, but I can hazard a guess as to how they get created:
The inner circle
We aren't innovative enough! Look at our competitors! We're falling behind. How can we INNOVATE dammit???
What if we hire a bunch of people to do just that! Their whole focus will be innovation!
Great idea! Here's 20 million dollars to set it up.
This is the solution you would come up with if you only thought about the problem for 5 seconds. It has some obvious flaws that no one appears to be capable of realizing.
Bonehead assumptions
Our current teams can’t innovate
This whole idea of an innovation team seems to assume that your current product teams can’t innovate. That they lack the skills to do so.
Our regular teams are “too close” to the product and aren’t aware of the “new trends” like “crypto” and “AI” and “quantum.” Their tiny brains just don’t have space for all that AND their regular work!
The solution: we need “smarter” or more “creative” people who can “think outside the box.”
I don’t have data to back this up, but I can pretty much guarantee you that people on innovation teams are not any more intelligent or creative than the regular people. Frankly, I’d be willing to bet they have some serious flaws. Mainly that the reason they are on an innovation team is that they couldn’t hack it on a team that was actually accountable to outcomes.
If you can’t hack it as a cat, you’re probably not gonna be around very long.
So we’re starting off praying that “if we just got better people, we could win.” This is the same logic that people use to justify hiring Deloitte or McKinsey, and all that gets you is pushing painkillers and supporting authoritarian regimes.
The only way to innovate is to create dedicated space for it
The second and related fallacy is that the regular teams can’t innovate because they don’t have time. We have to create a whole separate team with nothing to do but innovate.
Now I’ll admit, this sentiment is partially accurate. Often, the regular product teams can barely keep the train on the tracks, let alone have time for thinking about new innovative products. (Note: the reason for this is probably one of a few things: the team is constantly getting distracted by the idiot executive’s passion of the week or half their team was laid off last quarter.)
So regular product teams do lack time for “innovation,” but a dedicated innovation team lacks something too: knowledge of the business constraints and the customers. Knowledge that comes from doing the day to day work! And unfortunately, that lack of knowledge in an innovation team is a death sentence.
The ugly reality of innovation teams
So whether it’s a good idea or not, lots of companies have innovation teams. So here’s what usually happens…
The big reveal.
Exterior. INNOVATION TEAM KICKOFF CALL.
The team has a virtual whiteboard with one question on it: "How might we innovate garden rakes?"
INNOVATION JOE
What if the rake was on the blockchain and you could sell your rake NFT to your friends?
INNOVATION JENNY
What if we could use genAI to make the new rake designs for us and 3D print them at the stores? That way we wouldn't need designers and every customer could get a totally custom rake.
ALAN, DIRECTOR OF INNOVATION
Guys, you're not thinking big enough. We generate and print the rakes and then we put them on the blockchain.
Applause explodes from the room.
INTERIOR Innovation showcase. Two months later.
The team has built a proof of concept of "Gen-Rake." In a highly scripted sequence, it prints a rake with a QR code on it. The chat goes wild.
Cut to the next day. The CEO greenlights an additional 20 million dollars for the new Gen-Rake project. All product teams are ordered to allocate 30% of their capacity to Gen-Rake related initiatives next quarter. The company does a press release and interview about the new project. Stock price jumps by 10%.
Exciting right? So how does it turn out? Fast forward another six months and the Gen-Rake project is dead. Customers hated it and the logistics were a nightmare. But hey, c’est la vie right?
WRONG. Not only did you waste money on this group but you also distracted your regular product teams AND you have the opportunity cost. You could have used all that money and time to do something else! Double whammy.
How it’s really done
The silly thing with all this is that it actually wouldn’t be all that hard for most companies to innovate within their products more. There really just a few leadership tweaks that need to happen. No new innovation teams or consultants or any of that expensive nonsense.
1. Give your existing teams ambitious goals
If you’re a product or business leader, one of your core goals is to outline a strategy and from it, assign ambitious goals to your product team. NOTE: I said GOALS, not features or stuff to do. Something like “gain 5% market share in Latin America” or “reduce subscriber churn by 10%”.
2. Trust your teams, but hold them accountable
Once you’ve assigned those goals, let the teams come up with the solutions. They know the products and ecosystem best and so they will craft the best solutions that balance innovation with practical constraints.
That trust though, isn’t endless. The product teams need to be held accountable for results. If they don’t deliver, it’s on them and failure can have consequences.
3. Get the hell out of their way
Probably the most important. Give them one goal and stick to it. Don’t come back in a month with some totally different goal or a side quest to go on. Product teams need focus and space to maneuver and build. If you don’t, you can’t hold them accountable for bad results.