Innovation For Nothing
What is a team with an innovation agenda but no budget supposed to do?
It is a scenario that arises often. Management, particularly those who are proponents of some nebulous concept of innovation culture, believe that all it takes to get innovative is throw people at the problem. In some organisations, it is much easier to find people than find money, so it seems like and easy way to get an innovation program started.
The issue with this is that making innovation happen is not just about ideas and people. It also requires execution, which is the difference between an idea which sits around gathering dust, and one which can actually be converted into something that creates revenue. Execution, usually, requires money.
The situation where innovators have no budget at all almost certainly will result in failure, and here’s the reason.
Before it is possible to make an investment decision with respect to something new, there are three key questions which must be answered. The first is “Can we do this?” which is actually about the technicalities of the innovation. The second question is “Should we do this”, which is actually about the financials of the innovation. And the third question is “When?”, which has to do with market entry timing.
In order to answer such questions, innovators will probably have to pay for research, prototypes and, potentially, the time of analysts. It is rare indeed that an innovation group will have access to all these capabilities in house.
So for innovators with no money at all, there are few alternatives but to try to answer the key questions themselves. Usually, this results in very poor business cases, extremely unattractive to big budget holders on account of their paucity of detail. The innovators wind up tossing poorly formed propositions over the fence for funding, with little or no chance of being taken seriously.
When you start your innovation effort, you need to consider the funding options. James Gardner’s free online innovation book has advice you should consider.
