What’s the main difference between level 3 and level 4?
Level 3 indicates that the organization is engaged in experiments and reviews. 1 in
10 ideas get prototyped, incubation pipeline gets reviewed quarterly and 1 in 3
employees participate in innovation activities. That is, if you walk around the
corridors or shop floor, innovation is palpable. Level 4 indicates that, in
addition to the above things, the organization now has a balanced portfolio of
small, medium, and large impact ideas. On average, the organization generates
1 idea per employee per year, and projected impact of the big idea pipeline is
greater than 10% of the revenue and there is at least one operational
innovation sandbox.
The run rate of 1 idea per employee per person is not easy
to sustain. However, with the momentum of the experimentation and challenge
campaigns, it is achievable. It is also not difficult to generate big impact
ideas. Ask this question in a leadership meeting and you could get a few ideas.
Your favorite search engine could also help you get a few. Things get tricky
when the rubber meets the road for the big ideas – a champion, typically a CXO, taking
a strategic bet, allocating resources, building experimentation infrastructure,
put a dedicated team around a focus area. Sandbox hesitancy hypothesis says
that organizations either hesitate to set up a sandbox or don’t give enough
attention to it.
Organizations tend to be secretive about their sandbox setup
and that is understandable. Amazon was secretive about the Kindle effort and Apple
was secretive about iPhone. But many times organizations end up acquiring new
resources – people/technology to build the sandbox. For example, in 2007 Google
acqui-hired a team for starting its self-driving car sandbox which eventually
became Waymo. The VueTool team
was working on a digital mapping project and some of its members had won 2005
DARPA Grand Challenge related to robotic self-driving cars. Mahindra
acquired Reva to strengthen the electric automobiles sandbox and Flipkart acquired
an AR/VR company Scapic last November. In all these cases, in all
likelihood, there was a champion at the top level (Bezos for Kindle, Sergey
Brin for self-driving car, etc.)
Is innovation sandbox applicable only for large companies? I
don’t think so. I feel that even an SME would need to build a sandbox with all
its characteristics – a champion, focussed challenge area, experimentation
infrastructure, dedicated team, and failure protection.
If the sandbox hesitancy hypothesis has any merit, then a number
of questions can be asked. Why do organizations hesitate to build an innovation
sandbox? Is it a lack of ideas? Or lack of confidence? Or lack of clarity on the strategic
bet? Or lack of resources? Or lack of urgency? Or lack of sandbox management experience?