Integrating an Innovation Mindset into Organizational Culture
Words by Emily Smith
Recently, we were excited to join the vibrant discussion on a Corporate Innovation debate on LinkedIn hosted by Innolead. Here’s a bit on yet2’s perspective on integrating an innovation mindset into organizational culture!
In today’s fast-paced world, even industry giants like have faced the threat of disruption. Take General Motors (GM) and Chrysler. They were part of the “Big Three” auto companies that dominated the US auto industry in the 1920s, 1950s, and 1960s. The Big Three were based in Metro Detroit and produced three-quarters of all automobiles in the world by 1950:
1950s: GM had the largest share of the market at around 45%, followed by Ford at 25% and Chrysler at 20%.
1963: GM accounted for 53.7% of the new-car market, while Chrysler had a 13.1% share.
1965: The Big Three had a combined market share of over 90%.
1990s: The Big Three’s market share was above 70% for most of the decade.
However, the industry faced challenges in the 1970s and beyond, including increased competition from foreign auto manufacturers and high oil prices. GM & Chrysler were disrupted by the likes of Honda who came into the U.S. market with a cheaper car offering, that served the consumers that did not want the big expensive GM’s.
The phrase “disrupt or be disrupted” is no longer just a cautionary tale, but a reality for organizations across industries.
Consider these statistics. One ninth of large companies are headed toward disaster. At any one time, roughly one third of large US companies are experiencing a severe, 2-year decline in their ability to create shareholder value. Within that group, roughly one third fail to recover within the following five years.
Examples of large company disruptions from yet2’s OI Training:
To thrive, companies must cultivate an innovation mindset, integrate it into their culture, and foster an environment that encourages open innovation (OI) and external partnerships.
Building the Case for Open Innovation
Open innovation is a powerful tool for driving innovation and growth. By leveraging external partnerships, companies can access new ideas, technologies, and markets that might otherwise remain out of reach.
Successful open innovation requires more than just a willingness to collaborate; it demands a mindset and environment conducive to embracing external contributions. As part of our OI training, we cover a lot of this in detail, but here are few key snippets of learnings.
Key Learnings:
To embed an innovation mindset into your organizational culture, consider the following foundational steps to integrate into the environment you operate in:
- Build a Culture of Celebrating Wins
Recognizing and celebrating successes, no matter how small, reinforces the value of innovation. It motivates teams, builds momentum, and demonstrates the tangible benefits of innovation to the broader organization. This positive reinforcement helps embed an innovation mindset into the company’s DNA.
- Focus on Results Over Process
When embarking on open innovation, it is crucial to prioritize results over the process. Rather than getting bogged down in finding the “perfect” method, it is more effective to dive into external collaborations on key topics right from the start.
The journey of open innovation is dynamic and ever-evolving, so instead of delaying action to refine processes, focus on driving tangible outcomes. As you navigate this approach, we are here to guide you, offering the coaching and support needed to ensure your efforts yield the innovation breakthroughs you are aiming for.
- Openness is Critical
Do not waste time formalizing the innovation process – just get started. Identify the first key stakeholders/champions. Just get started, and pick first projects with high chances of getting to deal externally, to have first quick wins and build momentum internally.
Open Innovation Success Example
Mondelēz’s Co-Lab Tech: A Model for External Innovation
CoLab Tech is Mondelēz International’s R&D accelerator program for emerging food technology start-ups, a prime example of how integrating external innovation can lead to success.
yet2 partners with Mondelēz International to identify start-ups with innovative technology. CoLab Tech has provided Mondelēz with the ability to evaluate novel technologies while also providing the start-ups with valuable resources to help them accelerate their development.
The 8-week program includes virtual sessions, 1:1 mentorship, and the potential for proof of concept testing. Up to ten companies are selected in the areas of nutrition, ingredients, packaging and sustainability.
Following the success of the inaugural CoLab Tech in 2023, Mondelēz has announced the CoLab Tech 2024 participants. The newly announced cohort includes: Bread Free, Enginzyme, Enjay, HS Tumbler GmbH, Kokomodo, Luminescent, Outlander Materials, Savor, Tasteomics, and Yangi.
The 2023 CoLab Tech cohort included Computomics, WNWN Food Labs, Prote-in, Captic, Epogee, Cultivated Biosciences, SoilTech, Stephane Thermal Runs, and Eggmented Reality, providing Mondelēz with unique insights and opportunities to help solve their sustainability, ingredients and packaging challenges.
Through its CoLab Startup Engagement Program, Mondelēz International has achieved several key successes:
- Strategic partnerships: Mondelēz is collaborating with some of the participants to put their technologies into practice.
- Pipeline of developing technologies: The CoLab Tech program has built a robust pipeline of partnership opportunities, allowing Mondelēz to tap into fresh ideas and technologies.
- Reputation as a “Partner of Choice”: Mondelēz’s proactive approach has earned it a reputation as a preferred partner in the startup community, creating a halo effect that benefits the entire organization.
Observing Culture: The Difference Between Success and Failure
Organizations that successfully integrate open innovation exhibit distinct cultural traits. They prioritize speed and momentum, provide timely feedback, and remain open to new opportunities. In contrast, less successful companies tend to be slow-moving, risk-averse, and closed to ideas that don’t promise massive returns.
– Successful Companies: These organizations set clear KPIs focused on speed and responsiveness. They are open to disruptive ideas and ask questions like, “What would have to be true for this lead to be of interest?” They celebrate successes and ensure that internal and external innovations are equally incentivized.
– Less-Committed Companies: These companies often impose projects from management and view open innovation as a burden rather than an opportunity. They may resist external ideas, asking, “Why didn’t we come up with this?” rather than embracing new possibilities.
In conclusion, integrating an innovation mindset into your organizational culture is not just about adopting new processes; it’s about creating an environment where open innovation and external partnerships can thrive. By getting stakeholders involved early, celebrating wins, and fostering a culture open to new ideas, your organization can position itself as a leader in the ever-evolving marketplace.
This is just a small sampling from yet2’s Open Innovation Training. To learn more about this training for your organization, contact us here.