This document discusses how large, established companies can establish structures and culture to foster innovation. It argues that operating procedures focused on efficiency can inhibit innovation, and that innovation and operations should be structurally separate. Additionally, it states that companies need the right mix of people, including those without proven track records, to foster radical innovation. Rewarding behaviors over outcomes and establishing political support for new ideas are also discussed.

1. *
“Running an Agile Fortune 500 Company”
Aditya Yadav, aditya.yadav@gmail.com
in.linkedin.com/in/adityayadav76

2. * A Typical Global Company
* Fortune 500/1000
* 200 Divisions
* 40 Countries
* 25000 Employees
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3. *
@ Acme Inc.

4. * Original Question “We are not innovating
enough. How do we innovate?”
* The Correct Question - “How do we establish
structures, processes, people, culture and
reward systems to enable Innovation at our
company?”
*

5. *
And The Philosophy Behind The Answer

6. * Structure
* Processes
* Reward Systems
* People
* Culture
*

7. *
Contrary to what you think - From a business point of view creativity is
the easy part. If you know your thing then by the end of the day you
will have 4 new ideas. Creating a viable business and revenue stream
from it is the difficult part.

8. * When you have a mature product/phase then
to enhance your product you have to listen to
customers i.e. being a Customer Driven
Company!
* For radical innovation - feedback from the
customers is irrelevant and it will also hurt
you. Customers will limit you to current usage
patterns and needs. And will not be interested
in something radical in the future if it doesn't
solve their immediate problems right now.
*

9. * Companies with strict operating procedure
stifle innovation. Performance Measurement
systems of a mature phase company doing
execution/efficiency/operations will inhibit
innovation and lead to very conservative risk
management.
* If innovation is important you have to put aside
manpower and capital which might not deliver
anything or might deliver a blockbuster.
*

10. * No dominant company manages to stay
dominant with the next wave of technology.
e.g. Google, Yahoo, Facebook, ...
In order to succeed they need to
operationalize, execute and optimize the
current technology and business which inhibits
the next wave. Their system forces them to kill
innovation due to the strong operating goals
and performance systems that help them
succeed today.
*

11. * Patents have no correlation with innovation.
* Patents measure invention. Inventions are not
innovations (Ability to commercialize and bring
to market & benefit customers)
* Invention creates technical value, and
Innovation creates economic value
*

12. * 3-4 Gates for Technology
* 5-6 Gates for Products (Just because with
Products a lot more is at stake and risks and
costs are high)
*

13. * Operating and Innovation organization should
be...
* Physically - geo separated
* Structurally separate - one guy not responsible
for both
* Financially separate - should not be fighting for
the same budget and have multiple sources of
funding
* Culturally - different
*

14. * Google and 3M try to be contextually
ambidextrous within the same organization
unlike mentioned on the previous slide.
* Contextual Dexterity (People/Organization)=>
Operations + Innovation
* Most people look at 3M, Google, Amazon… and
praise it today. You should look at where the
DNA for these companies today is coming from
*

15. * Toppers of Top Institutes are conformists.
* They ask - Tell me the guidelines and what is
expected of me?
* They have proven track records to deliver proven
results NOT INNOVATION.
* People who have never experienced failures and
related learning's and humility don’t make good
innovators.
* Toppers don't have that
* Get the right mix of people!
*

16. * Don’t reward outcomes
* Reward behavior's e.g. mentoring, sharing
knowledge, doing this doing that etc.
* Sorry no third point. Above is all there is to it
;-)
*

17. * Incremental Operational Innovation (We are
not worried about it really, it happens in a
mature company if slightly facilitated)
* Radical Innovation - This is what we are
concerned with in the Strategic Sense.
*

18. * Innovation is an inherently extremely political
process - Dominant Players/Status Quo and
Operations fight with New Ideas and Innovators
*

19. * Organizations are filled with people in easy
chairs of dismissal of ideas. - "We think your
idea sucks and that's it. Case Closed"
*

20. Aditya!!!
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