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The Innovation Matrix Reloaded | The Discipline of Innovation

The Innovation Matrix Reloaded

Since I put the Innovation Matrix together last year, we’ve been experimenting with it to see if it makes sense. I’ve used it in a couple of classes, and John and I have discussed it with a number of people that are actually responsible for innovation within their organisations. We’ve learned that the basic principle seems to resonate pretty strongly with people. We’ve also learned that the original configuration could use a bit of work (conversations with Mark Dodgson and Kate Morrison also helped in this regard).

Here is the new version of the Innovation Matrix:

This is a bit of a distillation of observations over time.  I thought of it because I think that a lot of people that are trying to improve innovation within an organisation think that they can go from the bottom left (No Innovation Capability) to the top right (World Class Innovator) in one jump, simply by introducing some sort of innovation program.  I think that this is impossible – that you actually have to make the trip in a number of steps, and that there are many different paths that you can take.

The table has two increasing dimensions.  Across the horizontal axis there is increasing commitment to innovation.  This can include things like talking about how innovation is important, including it as a core value, putting in systems to support and improve innovation, and explicitly earmarking time, money and other resources to innovation. This is measuring innovation inputs.

Going up the vertical axis shows an increase in innovation competence – mainly the ability to generate and successfully execute new ideas. This measures innovation outputs.

Here is a brief description of each box:

  1. No Innovation Capability: these firms don’t innovate.  This isn’t necessarily bad – there’s no value judgment being made. They can be successful if they have strong positions in stable industries, or they can be average performers or struggling in other circumstances.  I think we can probably all think of examples for this category.
  2. Thinking About Innovation: firms in this category are starting to talk about the importance of innovation.  They might add it to their list of core values, or have a CEO that is starting to talk it up.  Regardless of this increase in awareness and commitment, they are still not very good at it.  This is often the first step that organisations take in trying to improve innovation.
  3. All Talk, No Action: is a self-explanatory category.  They are talking the talk, with official innovation programs, commitment of time and resources, etc.  But they’re still lousy at actually executing ideas.  They may have an excessive focus on ideation, a bad selection process, or just not be very good at executing.
  4. Accidental Innovators: These would be firms that innovate under some other name – so they might be really good at process innovations through a continuous improvement or lean program.  They are able to execute ideas reasonably well, but they don’t have any structure in place to support it, nor do they think that they’re innovative. They innovate through stealth.
  5. Average at Everything: these firms have some structure in place to support innovation, and they are getting better at doing it. Several firms that I work with have gotten to this level after moving first to Talking About Innovation.
  6. Potential Stars: there are two paths to get to this point. Along on, these organisations are good at innovating, and they are putting more resources into getting better at it.  They have top-level commitment to innovation, good processes in place, and dedicated resources for innovation.  They are reasonably good at executing new ideas and have the potential to become extremely good. The other path is to be very good at executing new ideas, but with less structure. These organisations aren’t sinking huge amounts of resources into the process, but they are consciously trying to innovate. Because they lack full commitment to innovation, it might not become systematized, but they also have the potential to be extremely good.
  7. Unicorns: the problem with making a matrix is that you have to put something into every box, even if it’s mythical.
  8. World Class Innovators: Another self-explanatory category. In these firms innovation is deeply embedded in the culture – everything is oriented around innovation. Think Google, Apple, 3M, Procter & Gamble etc.

How to use this:

Here are some things that I think we can do with this:

  • Use it to make a better picture of how firms improve at innovation:  Many of the people in my classes are in firms towards the bottom left, and many of the examples that we use to illustrate points are from firms in the top right (Google, P&G, 3M, etc.).  This might be too big a conceptual jump. Not every firm can get to the top right, and neither should every firm aim to. It is more productive to think of this as an incremental process of steps, rather than one big jump.
  • Track the evolution of firms: we can learn about how to best manage innovation by tracking how firms progress through this matrix.  For example, one firm I work with started with No Innovation Capability, then started talking about it and moved to Thinking About Innovation, and now that they are getting better at it they are Average at Everything.
  • Realise that there are multiple targets to shoot at: Like I said, not every organisation can be Google. Thinking about innovation with this matrix, you can see that all of the categories in the top row are excellent at innovation. However, the farther you go to the right, the more resources you have to commit to build and maintain this level of excellence. There are many situations where you can try to be an excellent innovator with a more bottom-up, less resource-intensive system in place.
  • Think About the Best Path to Follow: Almost everyone starts by increasing commitment.  The danger with this is that you can end up in the All Talk, No Action category.  I wonder if we should be figuring out ways to improve capability rather than commitment.  Or is this even possible? It’s an interesting question, and you can certainly make a strong argument in favour of increasing capability before you increase how much you talk about innovating.

The main point with The Innovation Matrix is that improving your innovation performance is a journey of many steps, not simply one big leap. The matrix is designed to help us think about this more accurately, and to be more successful at improving our innovation performance.

If you have any thoughts on this, we’d love to hear them.

About Tim Kastelle

Student and teacher of innovation - University of Queensland Business School - links to academic papers, twitter, and so on can be found here.

13 Responses to The Innovation Matrix Reloaded

  1. Alex 18 June 2011 at 9:58 pm #

    I think this is great Tim – summarises the innovation spectrum really well and will be very useful for talking with organisations about where they sit. (Though I have a problem with using Unicorns – it makes me want to aim for that bit of the matrix because nothing is cooler than unicorns…)

  2. Tim 19 June 2011 at 9:05 am #

    Hi Alex, I can see how that would be tempting. I didn’t really take that factor into consideration when I was putting this together…. That aside, I’m glad that it seems like it could be useful!

  3. Craig Thomler 19 June 2011 at 6:24 pm #

    I’m still not sure where the mythical creature comes in…

    I don’t think that the two axes are necessarily the best to choose.

    Perhaps ‘Innovation Competence’ should instead be ‘Innovation Execution Competence’. It’s all well and good to be competent at innovating (whether committed to it or not), however execution is the key word.

  4. Tim 19 June 2011 at 6:33 pm #

    Thanks for the feedback Craig. I’ve gotten similar feedback from a coupe of other people. And I agree that execution is really what we’re interested in along that dimension.

  5. Mathieu Halley 20 June 2011 at 10:19 am #

    Hi Tim,
    One curious thing about this model is that it can be read on a personal/personnel level as well as an organisational level. Meaning that an initial organisational level analysis using this model could then be distilled down to characterise the key personnel that need replacement/attention. e.g. “The problem here is that your R&D department is led by a unicorn.”

  6. Tim 20 June 2011 at 5:37 pm #

    I’d love to be able to say that to someone Mathieu, so I’ll choose to believe that it does in fact work on the personal level as well.

  7. Marco 21 June 2011 at 10:41 am #

    Hi Tim,
    For me the 2 dimensions can also be called “attitudes about innovation” (horizontal) and “behaviours to promote innovation” (vertical). Most people move quite easily on the horizontal axis. A spiffy presentation, a cool demo, a pep talk will move them from left to right. Apathy, prolonged period of inaction will move them back.
    But it is particularly hard to move them up and down (i.e. change behaviours). In my line of work, we use a mix of sticks, carrots, public acknowledgment, shaming and metrics. But it is still quite difficult.

  8. Tim 21 June 2011 at 5:53 pm #

    That’s an interesting thought Marco – I’ll give it some consideration. It does seem like a good way to frame it.

  9. Juergen Staeudtner 21 June 2011 at 8:09 pm #

    I think an example for Unicorns can be companies that focus on customer needs.

    When trying to deliver and implement new things to meet customer needs they can frequently develop new products and services without actually having a commitment to innovation.

  10. Tim 21 June 2011 at 10:04 pm #

    Thanks for the comment Juergen.

    I agree that those types of firms can innovate without having a commitment to it. I’m not sure that they would qualify as being excellent at it – that’s something to which I’m still giving some thought. But it’s definitely a good suggestion!

  11. Paul Kenny 23 June 2011 at 2:39 am #

    I really like this model Tim, I have a couple of questions just so I can be clear.

    Is innovation commitment just about ability to execute and does it include the ability to kill ideas that are not not going to add value.?
    I know it’s a cliche to bring in The Sinclair C5 as an example but this is a great example of an expensive (company ending) failure that should have been killed some time after the prototype phase.

    No one doubts that Sinclair were very good at innovation (calculators computers and watches were all disruptive tech & big sellers) and they must have been very committed to get their electric car to market, but their failure to test public reaction or even to get any outside view led them to launch a product that no one wanted. In this case they were far from world class. So how do we allow for the critical evaluation process in the model?

    Also do you have or plan to have a diagnostic tool to help organisations get to a mature understanding of where they really are (rather than they would like to think they are)?

    Great post

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