Eight Foundations for the Front End of Innovation

How do you know if you have a good front-end of innovation?

• You’re generating lots of ideas
• There’s a steady stream of great concepts coming out that mirror your strategic intent
• The organization is energized by each concept’s potential and is motivated to drive effective implementation
• You are meeting or, better yet, beating your innovation metrics in timing, costs, and profitable growth
• Your current and new businesses follow the life-cycle model that is right for the firm

A good front-end should help the organization achieve these outcomes.

When you talk to managers at companies that have a good front-end in place and look at their processes, you find common ground. Their approaches may have different names, but they share key attributes.

I’ve broken them down into 8 front-end foundations.

1. Systematic and repeatable front end process
2. Empowered and connected front-end teams with executive sponsorship
3. Externally focused organizational learning
4. Cross-functional team immersion
5. Customer-driven research approach
6. Open technology discovery
7. Climate for developmental thinking
8. Portfolio perspective

Here they are with a little more depth!

Systematic and repeatable front end process - A good front end requires an on-going process rather than periodic ideation when the cupboard is bare. It includes discovery, concept development, and validation phases. It enables sustained innovation by delivering a steady stream of opportunities aligned with strategy.


Empowered and connected front-end teams with executive sponsorship - Small cross-functional teams make up the core of the front end organization. The team has freedom to explore and develop opportunities within prescribed strategic focus areas. Team members have linkage to the business and their functional homes, providing connectivity to the front end. The team is flexible in composition, adding temporary expertise as needed from within or outside the firm. Executive sponsors provide mentoring and resources, as well as organizational blocking and tackling when needed. There is clarity in roles, responsibilities, and decision making within the team and across the organization.


Externally focused organizational learning - Organizational learning is embraced to overcome internally derived paradigms or mental models that limit management’s thinking. The front-end goes beyond what’s already known. They socialize their discoveries and concepts, expanding the range of opportunities in a manner the whole organization can get behind.


Cross-functional team immersion - Deeply imbedding new knowledge within the cross-functional team is critical. Leveraging the diversity of informed minds leads to better problem definition, solution development, and ultimately organizational alignment.


Customer-driven research approach - Building an empathetic understanding of current and emerging customer needs is a central process. The team uncovers new frameworks by listening to the customer’s story. They discover customer need insights that can be merged with market and technology insights to guide innovation.


Open technology discovery - Technology discovery is proactive and connected to customer needs. Anticipating internal and external technology’s impact on the competitive environment, customer needs, and possible solutions allows for faster, innovations with competitive insulation. But there is more to it. Understanding the future impact of science and technology helps the team anticipate latent customer needs. Needs that the customer cannot articulate and may not even realize they have yet. Focusing the innovations towards latent needs creates the opportunity to truly excite customers and transform the market.


Climate for developmental thinking - A non judgmental and safe environment allows the team to create ideas and not kill them too soon. Ideas are nurtured and developed into viable concepts that can withstand the rigor of validation. The developmental thinking environment enhances team creativity, the strength of their new concepts, and the willingness of the organization to adopt and implement their innovations.


Portfolio perspective - The team creates a range of innovation opportunities from close-in changes to existing offerings up through breakthroughs. The portfolio is aligned with strategy, and takes into consideration the needs and timing of the business units and technology availability. As a result, the pipeline is populated with a steady stream of innovations.

Take a look at your front-end.

How many of these foundations does your organization embrace?

Too Old to Innovate?

In the digital world we live in, innovation often seems to be the province of the young. If you’re old enough to remember what it was like to have a corded telephone in your kitchen, the popular assumption is that you have too many cobwebs in your head to do any genuinely creative thinking. Happily for those of us who spent our teenage years tethered to a phone jack, a recent flurry of research has confirmed our (often superior) capacity for innovation.

Newsweek recently reported in their article, “The Golden Age of Innovation” that “despite stereotypes of entrepreneurs as fresh-faced youngsters, new research has found that older workers are more likely to innovate than their under-35 counterparts.” Here are a few highlights:

• The highest rate of entrepreneurship in the U.S. is in the 55-64 age group
• People over 55 are almost twice as likely to start a successful business as those 20-34
• Since 1996, the entrepreneurship rate has actually dropped among people under 35

Even within established companies, older workers may be the strongest contributors to innovation. The Newsweek article reports that one German company commissioned an internal review of its continuous improvement system, expecting to justify its early retirement program. The opposite happened. It turned out that older workers’ ideas for process improvements produced significantly higher returns than the ideas offered by younger workers. The early retirement program is being phased out.

So what does this mean for innovation teams? As always, diversity is critical. The most productive teams embrace the contributions from older and younger employees alike. While the younger set may make valuable contributions based on their comparatively recent education in the newest tools and techniques, older workers have years of accumulated expertise in their fields, an understanding of customer needs based on decades of observation and feedback, and, ideally, a willingness to share their knowledge. Employers can encourage this sharing by acknowledging its value. BMW’s mixed-age team and Siemens “cross-mentoring” are attempts to bring younger and older employees together for maximum impact. Perhaps that is only a start.

In this post-recession environment, many workers who had been approaching retirement are now considering staying employed well beyond their previously planned exit dates. “How-to” take advantage of the older workers’ experience, expertise and knowledge, overcome the stereotypes, and drive innovation will be the next challenge for the innovative organization. Organizing, training, and coaching team members and their management sponsors to take advantage of diversity, young and older, should be part of the approach.

Age diversity is a resource that every company aspiring to innovation excellence should embrace.

Creative Destruction: Why Microsoft Can’t Innovate Part 2

So, how do you organize your company for innovation? You need to match the organizational structure to the innovation strategy. Microsoft failed to do that, and that was a big part of the problem.

Let’s take a look at the company’s lifecycle.

In the late 1980s, Microsoft was a fast-growing, high-energy, risk-taking enterprise. They needed a certain management style to implement and create value from their breakthrough innovation. But as the business grew and eventually matured, it needed a different type of management.

By the late 1990s, Microsoft had a hierarchy of managers running its large, complex business. The structure reflected to company’s vested interest in the status quo: They need the Windows and Office cash cows to keep generating cash. If those cows want to graze on the occasional newly-sprouted idea, so be it.

The problem, of course, is that other, more nimble growth organizations started nurturing those new ideas, and finding success.

Strategic Intent: Incremental or Breakthrough?

A key question corporate innovators need to ask is how to nurture ideas so you can create rising star innovations, bring them to market and capture their value, while maintaining the cash cows. How do you foster innovation in a way that’s in line with your strategic intent?

At GE, P&G, Coca Cola and many other successful companies with mature businesses, the intent of innovation is to continue the success of the core business. Although they develop new products, and occasionally new platforms, most of their innovation is incremental. It provides as much growth as the market expects.

With that strategic objective in mind, these companies organize within their existing functional structures and establish cross-functional teams, with management oversight and a phased-review innovation process.

Successful senior managers provide strategic focus and balance the resources for innovation based on their higher level portfolio perspective. They pace the resources based on the progress of the team relative to other innovation investment opportunities.

On the other hand, when the strategic focus is on breakthrough innovation, the goal is to disrupt the market place and gain competitive advantage, drive growth and capture substantial value. Companies successful at this higher level of innovation take a different organizational approach. Some refer to it as Tiger Teams: separate organizations outside the core business.

Tiger teams are fully dedicated, with control over their own resources and process. They may be physically located outside the walls of the parent business, and their leader may be at the CEO level with full budgetary authority. They are not vying for resources with managers responsible for sustaining a huge business like Microsoft Office. They have different decision criteria, performance standards, pace of innovation, and risk environment.

The interesting question is why one of the most successful innovation companies of the past 30 years structured itself for incremental growth in an industry full of breakthroughs. Why did they force start-up growth businesses to compete with internal 800-pound gorillas? It starts with leadership. What drives Bill Gates and Steve Ballmer compared to Steve Jobs? Where are their companies in the business lifecycle?

Steve Jobs is the super product champion driving a growth business by pursing a breakthrough innovation strategy. That’s not what Microsoft is all about. If they want to go in that direction, they need to organize for it.

[Image - Crabapple.net]