How To Build an Innovation OS (Operating System)

“It’s not about ideas. It’s about making ideas happen.” — Scott Belsky

As a leader, innovation is your biggest lever for growth.

Innovation is also how you can respond to market disruptions, changing consumer preferences, and technological advancements.

Without a simple approach for innovation, these challenges can quickly make your existing business models obsolete.

For many organizations, innovation isn’t a lack of ideas or inspiration.  It’s the struggle to translate those ideas into tangible, successful outcomes.

I’ve led innovation for several years at Microsoft, including leading innovation as head coach for Satya Nadella’s innovation team.

One of the most important things I learned is how to structure innovation to make it a sustainable team sport.

To support innovation in any sort of sustainable way, you need to structure it.

Imagine having a structured approach, a well-defined framework, and a clear roadmap for innovation that empowers your organization through creativity, development, and implementation of new ideas.

This is where the concept of an Innovation OS (operating system) comes into play.

In this article, learn how to structure and implement a powerful Innovation OS (Operating System) that drives sustained innovation, fosters a culture of creativity, and helps you forge the future of your organization, today.

What is an Innovation OS (Operating System)?

An Innovation OS refers to a structured and systematic approach that an organization adopts to manage and drive innovation effectively.

It comprises a set of interconnected strategies, processes, tools, and practices designed to foster a culture of innovation and deliver sustainable results.

This Innovation OS helps an organization streamline its innovation efforts, align them with its strategic goals, and ensure that innovation becomes an integral part of its daily operations.

It provides a framework for managing innovation from idea generation to execution, enabling the organization to continuously adapt and thrive in a rapidly changing business environment.

Why Do You Need an Innovation OS?

Here are a few reasons why an organization may need an Innovation Operating System (Innovation OS):

1. Sustainable Growth: To achieve consistent and sustainable growth in an ever-evolving business landscape, organizations need to continually innovate to stay relevant and meet changing customer demands.
2. Competitive Advantage: Innovation can provide a significant competitive edge by enabling a company to differentiate itself from rivals, respond swiftly to market changes, and outperform competitors.
3. Cost Efficiency: Implementing innovative solutions can lead to cost savings, improved resource allocation, and enhanced operational efficiency, ultimately boosting the organization’s profitability.
4. Market Expansion: When entering new markets or addressing emerging customer needs, innovation is crucial for tailoring products and services, ensuring successful expansion, and capturing new opportunities.
5. Talent and Culture: An Innovation OS can attract and retain top talent who are drawn to innovative organizations. It also fosters a culture of creativity, experimentation, and adaptability, which is essential in today’s business environment.

5 Key Choices for the Success of Your Innovation OS

There’s no shortage of innovation blueprints and playbooks and ideas about end-to-end innovation.

But there is a lack of strategy, implementation and success 🙂

According to Dr. Marc Sniukas, the key to success is in addressing 5 choices about how you manage innovation:

1. Governance: How do you want to manage and steer your innovation efforts?
2. Organization: How do you want to organize your innovation efforts?
3. Processes and Practices: What is your innovation playbook? Which methodologies, frameworks, and tools to use?
4. Capabilities and Infrastructure: What skills, support infrastructure and tools do you need to put in place?
5. Activation and Enablement: How are you going to nurture and spread a culture of innovation throughout the company?

Let’s take a closer look at how to structure an organization for innovation…

Incremental or Sustaining Innovation

To achieve a culture of sustained innovation, it’s important to adopt an inclusive approach, “innovation from everybody”, where everyone has a role to play.

This can be enhanced by having a dedicated team of experts who facilitate and support the innovation process.

By combining the creativity and drive of the entire organization with the specialized knowledge of the core team, the potential for successful innovation is greatly increased.

The idea here is that “everyone is innovating” and it’s a part of the culture.

That’s good.

It’s mainly effective for incremental or sustaining innovation.

But when it comes to the bigger transformations and venturing into new areas outside of your core, you need a more strategic approach with support end-to-end to be successful.

Transformation and Non-Core Business Growth

If your goal is to venture into uncharted territories and explore new areas for growth or transformation, a dedicated team is essential.

With a dedicated group of experts focused solely on this objective, you’ll have the best chance of creating and executing on innovative ideas that can drive non-core business growth.

According to Dr. Marc Sniukas, you can design your organization for innovation as follows:

1. Cross-Functional Innovation Steering Committee.

A steering committee made up of key stakeholders from various business units and functions plays a crucial role in driving innovation forward.

This committee sets the innovation agenda and outlines the areas of focus, providing guidance and accountability to ensure that the organization’s innovation aspirations are realized.

2. Corporate Innovation Function.

The Center of Competence is the heart of the innovation system, shaping the way it operates.

It defines the methodologies, processes, and tools needed to drive innovation, and focuses on delivering both short-term and long-term, game-changing innovations.

This center is dedicated to ensuring that the organization has the necessary infrastructure in place to continuously innovate and remain ahead of the curve.

3. Innovation Roles Throughout the Company.

The local innovation team acts as a bridge between the organization and the corporate innovation efforts.

Their focus is on coordinating local innovation initiatives and ensuring they align with the overall innovation strategy.

With a team of local innovation experts at the ready, they provide the support, expertise, and guidance needed to bring local innovation projects to life.

By working closely with both the corporate and local teams, this group helps to ensure a consistent, unified approach to innovation across the organization.

4. Orchestrated Innovation Ecosystem.

The Corporate Innovation team is responsible for engaging and collaborating with external partners to drive innovation forward.

They leverage existing solutions and tap into external expertise to address innovation challenges and provide inspiration for new ideas.

With dedicated resources at their disposal, this team ensures that the organization is taking full advantage of the opportunities for innovation that exist outside its walls.

By fostering partnerships and exchanging knowledge, they help to keep the organization on the cutting edge of innovation.

Practical Examples: Learning from Innovative Leaders

To truly understand the power of structuring an organization for innovation, let’s take a look at some real-world examples of companies that have successfully implemented innovation.

1. 3M’s Innovation Bootcamps: 3M, a company synonymous with innovation, hosts innovation bootcamps where employees from different divisions collaborate on projects. This cross-pollination of ideas has led to iconic products like Post-it Notes, demonstrating the power of bringing diverse minds together.
2. Amazon’s Two-Pizza Teams: Amazon’s approach to innovation involves creating small, cross-functional teams that are small enough to be fed with just two pizzas. This structure allows for quick decision-making and fosters a culture of ownership and innovation within each team. The result? Innovations like Amazon Web Services (AWS) that revolutionized cloud computing.
3. Apple’s Design-Centered Innovation: Apple’s innovation strategy centers around design excellence. By focusing on user experience and aesthetics, Apple has transformed industries with products like the iPhone, iPad, and MacBook. Their emphasis on design-led innovation showcases how a well-structured approach can lead to game-changing inventions.
4. Google’s 20% Time: Google is renowned for its innovative culture, and one of the practices that set the company apart is its “20% time” policy. Employees are encouraged to spend 20% of their workweek on projects unrelated to their primary job. This policy has led to innovations such as Gmail and Google Maps, showcasing how a culture of innovation can drive groundbreaking ideas.
5. Toyota’s Continuous Improvement: Toyota’s success story is rooted in its commitment to continuous improvement and innovation. The company empowers every employee to contribute ideas for process enhancements, creating a culture where innovation is everyone’s responsibility. This approach has made Toyota a leader in lean manufacturing and automobile innovation.

Actionable Takeaways: Building Your Innovation Operating System

We’ve walked through the essence of innovation and the strategies for structuring an organization.

Now it’s time to equip you with actionable steps to start building your innovation operating system.

Here are a few key takeaways to foster a culture of innovation within your organization:

1. Define Your Innovation Governance: Begin by setting clear governance structures for innovation. Formulate an Innovation Steering Committee comprising key stakeholders from various business units and functions. This committee will guide your organization’s innovation agenda, ensuring alignment with strategic goals.
2. Establish a Corporate Innovation Function: Create a Center of Competence dedicated to innovation. This core team will define the methodologies, processes, and tools needed to drive innovation. It plays a crucial role in delivering both short-term and long-term, game-changing innovations.
3. Empower Local Innovation Teams: Form local innovation teams that act as bridges between corporate and local innovation initiatives. These teams ensure alignment with the overall innovation strategy and provide support, expertise, and guidance to bring local innovation projects to life.
4. Collaborate in an Orchestrated Ecosystem: Engage with external partners to drive innovation forward. Leverage external expertise, existing solutions, and partnerships to address challenges and inspire new ideas.
5. Encourage an Inclusive Culture: Foster a culture of innovation where everyone has a role to play. Encourage employees at all levels to contribute ideas, experiment, and embrace innovation as part of the organizational culture.
6. Measure and Iterate: Implement Key Performance Indicators (KPIs) and innovation metrics to track the impact of your innovation operating system. Continuously evaluate your strategies, make necessary adjustments, and iterate to drive ongoing improvement.
7. Seek Inspiration from Innovators: Learn from the success stories of innovative organizations like Google, Amazon, 3M, Toyota, and Apple. Draw inspiration from their strategies and practices and adapt them to your organization’s context.

Structure Your Innovation for Success

The speed of change is a challenge you already feel.  Technology is changing the game under your feet.

As the competitive landscape evolves, the challenges are getting more complex.

To respond as a leader, the need for a well-structured innovation framework becomes even more important.

Dr. Marc Sniukas’ five key choices—Governance, Organization, Processes and Practices, Capabilities and Infrastructure, and Activation and Enablement—provide a roadmap to help you navigate this ever-changing path.

Whether you are trying to establish continuous innovate within your core business or embark on non-core growth and transformation, structure your innovation for success.

Engage cross-functional innovation steering committees, nurture corporate innovation functions, empower local innovation teams, and orchestrate innovation ecosystems.

But remember, innovation is not confined to hierarchies, roles or orgs.

Innovation is a collective endeavor that thrives in an inclusive culture. Encourage every member of your org to ignite the spark of innovation.

As you embark on your innovation journey, measure progress, draw inspiration from trailblazers, and continuously refine your innovation operating system.

Innovation is not a one-time achievement—it’s a mindset, a commitment, and a way of life.

Innovation is also the key to your future success, that starts by what you do today.

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