The document discusses how to design organizations to be more innovative through ambidextrous structures that balance exploration and exploitation, using employee innovation networks to generate new ideas, and engaging in open innovation by leveraging external partners and ideas. It emphasizes that an innovative organization requires integrating strategies, processes, structures, resources, and culture to successfully generate new ideas and bring innovations to market. The people within the organization are ultimately responsible for innovation, so organizations must identify and empower their best innovators.

1. Frank Dethier

2. Frank Dethier –
HOW TO INNOVATE?
ONE HOLISTIC FRAMEWORK
Integrate Strategy, Process, Organization, People
& Culture in one holistic approach  this will
seriously improve your chances of success
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Strategy
Process
Organization
Resources
Culture

3. Frank Dethier –
HOW TO INNOVATE?
INNOVATION STRATEGY?
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Innova-
tion
Strategy
1. What’s your goal?
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2. A) How much investment? From where?
B) When?
C) Who?
3. Define & select your opportunities
(strategic innovation area’s)

4. Frank Dethier –
New &
Existing
Markets
Trends
• Technology
• Need
• Business
• Legal
Innovation
challenges
Dev
Projects to obtain
understanding of
• Technology
• Customer Need
• Business
Internal &
External Ideas
INNOVATION PROCESS S
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Strategy
Idea
selection

5. Frank Dethier
Session 4: Innovative
Organizations

6. Frank Dethier –
HOW TO INNOVATE?
ONE HOLISTIC FRAMEWORK
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Strategy
Process
Organization
Resources
Culture

7. Frank Dethier –
HOW TO INNOVATE?
ORGANIZATION
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Explore Exploit
Ambidextrous
Employee Innovation
Networks
Open Innovation

8. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS
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9. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS
 Organizational structure keeps current business
alive
 But often hampers Innovation
 Example
 Focus on current results
 Short term goals and metrics
 Little communication between people/departments
unless for current Operations
 Very clear agreements on roles and responsibilities
 Only top-down communication
 …
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10. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS
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Exploration Exploitation
Only this 
Costs of experimentation
without benefits
Only this 
Can’t adapt to changing
circumstances
Long-term, risky,
uncertain
Short-term, immediate,
certain benefits

11. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS ORGANIZATION
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Incremental
Innovation
Radical
Innovation
Sustaining
Innovation
Disruptive
Innovation
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More discussions needed
about ‘separation’

12. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS ORGANIZATION
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13. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS ORGANIZATION
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Loose
coupling
Structural
Google X-
labs
Google
Exploration Every individual
20% Exploration
80% Exploitation
Contextual
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Management

14. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS – HOW?
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Ambidextrous in organization
or project
Loose
coupling
Solution 1
Focus on
exploration
Individuals or units
Focus on
exploitation
Ambidextrous in time
Focus on
exploration
Complete organization
Solution 2
Focus on
exploitation
Later in time
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15. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS – HOW?
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Ambidextrous in organization
or project
Loose
coupling
Solution 1
Focus on
exploration
Individuals or units
Focus on
exploitation
Ambidextrous in time
Focus on
exploration
Complete organization
Solution 2
Focus on
exploitation
Later in time
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More used in ‘heavy’
R&D companies
More used in
dynamic service
companies

16. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS – HOW?
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Ambidextrous in organization
Loose
coupling
Solution 1a: Structural
Focus on
exploration
Units
Focus on
exploitation
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Ambidextrous in project
Solution 1b: Contextual
Focus on
exploration
Every individual
Focus on
exploitation

17. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS OVERVIEW
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Solution 1a
Focus on exploration
Focus on exploitation
Solution 1b
Focus on exploration
Focus on exploitation
(Contextual,
agreed % of time)
Structural
Solution 2
Focus on exploration (time N)
Focus on exploitation (time N+1)
Time based
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18. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS OVERVIEW
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Solution 1a
Exploration
Exploitation
Solution 1b
Exploration
Exploitation
Solution 2
Exploration
Exploitation
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Pro’s Con’s

19. Frank Dethier –
INNOVATIVE ORGANIZATIONS
CORPORATE VENTURING
Rather extreme example is setting up corporate
venturing unit inside large organization
 To stimulate entrepreneurial activity within an
existing business
 Based on methods used in VC industry
 Reward people for value created
 Invest in many projects to overcome uncertainty
 Fixed process to help with assessing projects (lean start-up)
 Care in formation of management team
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20. Frank Dethier –
INNOVATIVE ORGANIZATIONS
CORPORATE VENTURING
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Dutch engineer Barend Pek is part of a team helping turn the
revolutionary idea of cooling natural gas to liquid at sea into reality –
boosted by early funding from the Shell GameChanger program
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• Executive level support
• Dedicated funds
• Dedicated people
• Autonomous authority
• Open but limited scope –
Anything outside current
practices but within the ‘strategic
intent’ of the firm as an energy
company.
• Open to any idea from anyone
anytime

21. Frank Dethier –
INNOVATIVE ORGANIZATIONS
CONCLUSION AMBIDEXTROUS
 Choose a model that fits with your organization
& Innovation Strategy
 Another way of looking at it: The art is in finding
ways to optimize these apparent opposites
simultaneously: introducing standard operational
work wherever possible, while continuing to get
better and better at delivering customer solutions
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22. Frank Dethier –
INNOVATIVE ORGANIZATIONS
AMBIDEXTROUS ORGANIZATION
 Management Team needs to take full responsibility for
Growth as well as Earnings
 Spend 20% to 40% of your time as CEO on Growth/Innovation
 Ask right questions
 What serious customer problems can we solve?
 What do we need to learn to be effective in this new terrain?
 What capabilities must we assemble?
 What business model will capture value?
 Instead of
 What revenue can we expect in 18 months?
 What does the P&L look like?
 How fast is the market growing?
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23. Frank Dethier –
HOW TO INNOVATE?
ORGANIZATION
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Explore Exploit
Ambidextrous
Employee Innovation
Networks
Open Innovation

24. Frank Dethier –
INNOVATIVE ORGANIZATIONS
EMPLOYEE INNOVATION NETWORKS
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Discussions @ lunch
Light agenda & involve
people other departments
Rapid prototype of idea
2nd and 3rd team created
All in a Lean Startup approach and
compliments official innovation program

25. Frank Dethier –
INNOVATIVE ORGANIZATIONS
EMPLOYEE INNOVATION NETWORKS
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Autonomy: e.g. own agenda
Mastery: e.g. improve your skills like brain-
storming
Purpose: e.g. company acknowledging
discussions and resourcing their ideas
Informal networks rely on intrapreneurs, who are filled with energy,
can engage others and have a willingness to push for change.
Identifying, directing and engaging these individuals are key.

26. Frank Dethier –
HOW TO INNOVATE?
ORGANIZATION
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Explore Exploit
Ambidextrous
Employee Innovation
Networks
Open Innovation

27. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OPEN INNOVATION
 What?
 Prof H. Chesbrough “Open innovation is a paradigm
that assumes that firms can and should use external
ideas as well as internal ideas, and internal and
external paths to market, as the firms look to advance
their technology”. Alternatively, it is "innovating with
partners by sharing risk and sharing reward.”
 Why?
 Probably, others can help you
1. Customers
2. Suppliers
3. ‘Outsiders’
4. Specialists
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28. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OPEN INNOVATION
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29. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OPEN INNOVATION
Be careful when actively pursuing OI
 It cannot be a remedy for your own Innovation ills
(ideas, development, go-to-market, …)
 Able to set-up strong relationships
 Have IP policy
 Not-invented-here syndrome
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30. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OPEN INNOVATION
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Control & Leveraging
What do you want?

31. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OPEN INNOVATION
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Need in business area’s

32. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OPEN INNOVATION
 Why pursuing OI?
 Speed up TTM, reduce/share investment costs, get
more creative/innovative ideas, …
 But define first your
 Goal & scope
 Investments
 IP
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33. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OI & SME
 Small firms lack the required internal financial
resources and technical capabilities
 They therefore must collaborate with external
partners to innovate successfully and especially
open innovation creates new business
opportunities for SMEs because they can develop
business model innovations without having the
required technologies in-house
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34. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OI EXAMPLE IN 1 SME
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Curana: OEM for bike accessories
Mid-1990’s: brands buy internationally  huge price pressure
Challenges
• How to create products with premium value?
• No in-house design expertise
Strategic ambition: create unique products for every brand

35. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OI EXAMPLE IN 1 SME
 Long learning process
1. Plastic mudguards  no premium look
2. Garden chair industry  top segment uses
combination of plastics & alu
3. Strategic cooperation with such partner  unique
technology & product
 Today, Curana creates new concepts and uses
new materials without waiting for explicit
request of bike brands
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36. Frank Dethier –
INNOVATIVE ORGANIZATIONS
OPEN INNOVATIONS
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How far can you go?
Co-Creation
Micro-factoriesOpen Source
Community
Design
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37. Frank Dethier –
DESIGN V0.1 OF YOUR
INNOVATIVE ORGANIZATION
 How will you design a more innovative
organization?
 Ambidextrous organization
 Innovative networks/networking
 Open Innovation
 Discuss within your team
 Time foreseen: 30 min
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38. Frank Dethier –
 How will you design your organization to become
ambidextrous?
 How will you employ more networks/networking?
 Do you see opportunities for OI? Why (not)?
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39. Frank Dethier
Session 5: Resources

40. Frank Dethier –
HOW TO INNOVATE?
RESOURCES
 Strategy, Process & Organization are important,
but eventually, your People will innovate!
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41. Frank Dethier –
HOW TO INNOVATE?
RESOURCES
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Right person,
Right job
Individuals Project Teams
Diversity
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42. Frank Dethier –
HOW TO INNOVATE?
INDIVIDUALS
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Who are your best Innovators?
Most companies have a lot of experience identifying their best performers,
but not their best Innovators
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43. Frank Dethier –
HOW TO INNOVATE?
INDIVIDUALS
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44. Frank Dethier –
HOW TO INNOVATE?
YOU
 Run 2 exercises and get a good idea
1. http://www.humanmetrics.com/cgi-win/JTypes2.asp
2. http://www.standaard.be/innovatietest
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