Starting Innovation Seems Easier for Smaller Companies

After polling innovation managers and experts from all over the world about the size of the organization in relation to the ease of starting an innovation initiative, Gijs Van Wulfen takes a look at the arguments.

The fuzzy front end of innovation confronts you with a lot of questions. In my new book ‘Creating innovative Products and Services’ I try to solve them with the FORTH innovation method.

In one of my last blogs on InnovationManagement I discussed more than 40 reasons why people struggle with innovation. Corporate culture, uncertainty, a lack of support, a lack of market insights, the absence of an appropriate process, missing the tools and lacking the right resources all matter a great deal.

An interesting question is if the size of the organisation matters in the process of starting innovation. In the linkedin group on the FORTH innovation method, consisting of front end innovation managers and experts from all over the world, we had a poll on this with a clear outcome. Half of the innovation experts and managers believe starting innovation is easier for smaller companies. A quarter thinks there’s no difference and a quarter says it’s easier for bigger ones.

Is starting innovation easier for bigger organizations compared to smaller ones?

4%        Yes, it is easier for bigger ones

21%     Yes, it might be easier for bigger ones

26%     There ‘s no difference

29%     No, it might be easier for smaller ones

20%     No, it is easier for smaller ones

Even more interesting are the arguments!

Why would starting innovation be easier for smaller organisations? Five arguments are:

  1. It is easier to create urgency is a small firm.
  2. It is less hierarchical and political, thus quicker in adapting to change.
  3. Small companies are nimble and flexible.
  4. Entrepreneurs in small companies and start-ups are more willing to take risks.
  5. Smaller organisations are full of energy and ideas.

On the contrary there are four arguments mentioned why it would be easier for big ones to start innovation:

  1. A big firm has the advantage of deeper pockets. and a larger ‘brain pool’ to tap into.
  2. A big firm has more potential innovation champions.
  3. Larger enterprises have more room for failure.
  4. Innovation usually is a more integrated activity in the bigger ones.

A very interesting observation was that it might be easier to start innovation in smaller companies, but not necessarily easier to complete. They often do not have the resources to follow through. If the first five attempts at innovation are not quite right, funding the 6th initiative might be near impossible due to depleted financial resources. And we know that only 1 out of seven ideas is a success.

At the end of our discussion nevertheless most innovators agreed upon the fact that size doesn’t matter enough to be a clear distinction. What really matters for both small and big companies is the right culture, – strategy, – innovation processes and management style that create a fertile environment to jump start innovation.

By the way: Innovation is never easy. You just have to learn to love the struggle!

About the author:

Gijs van Wulfen (The Netherlands, 1960) is the founder of the FORTH innovation method. FORTH is an effective and structured method for ideating innovative products and services. The method is published in his inspiring and practical book Creating Innovative Products and Services’ (Gower, 2011).

He helps organisations to kick start innovation by facilitating the FORTH innovation method and advising companies on their innovation strategy, process and organisation. His clients are international companies in industry and services, as well as non-profit organisations in government and health. Gijs also trains facilitators in his method. His dream is to make FORTH the most used method for the front end of innovation around the world.

Gijs is a both presenter and chairman at several (international) innovation conferences, like the ISPIM Conferences and the European Conference on Creativity and Innovation. He is also founder of the yearly Dutch Innovation Conference on creating new products: ‘Nieuwe Producten Bedenken’.
  • Jeroen van Lawick

    Gijs,

    Thanks for wrapping this up all together, it now becomes actionable and insightful!
    Jeroen van Lawick

  • Gijs van Wulfen

    You are welcome Jeroen. Thanks for your contribution to this useful discussion in our FRTH linked in group.

    Gijs

  • Kutta Daudi

    Gijs,

    I like ‘it might be easier in smaller ones’. In both cases, it is actually not easy. It is difficult. Only that in smaller ones it might be easier to deal with decisions, conflicts, directions, commitments, leadership and facilitation. 

    In large organizations, especially those that preserve innovation to a small unit of the organization called R&D or nowadays with an I thrown in for innovation hence RD&I might also find it easier because of the size on the unit involved. But only if the organization is successful.

    On the hand,  innovation with a whole organization approach  might be difficult in large organizations based on the above factors.  It takes a lot for top management and leadership  to imbue a collaborative,  innovation and entrepreneurship spirit and culture at all levels. 

    A carefully facilitated strategy must precede the innovation process to ensure an easier  implementation of whole organization culture of innovation.

    However, it is not hard in both cases.

  • Luke Winter

    Gijs,As you’ve succinctly stated, whilst larger companies may have a bigger ‘brain pool’ to tap into on the company payroll, it is also common that this pool can be stifled by the humdrum of a familiar large scale work environment. On the other hand, while small companies have fewer people on payroll, they may be freer to bring their energy and ideas to the table. However, the potential knowledge pool of companies both big and small is no longer limited to the size of their office, and in my opinion, making such a distinction between the two is now outmoded. Product managers and marketers are now able to turn directly to consumers for ideas and advice on how best to innovate. This recent expansion of the knowledge base to include consumers means the amount of ideas and information available to all companies, no matter what their size, is huge.The companies that succeed will be those that best manage this wealth of information and have a tightly integrated workflow that allows the most innovative ideas to rise to the top, become part of the product development process and form an integral part of their final products. The software to do this is now readily available to companies both big and small. With new pools of information and new tools to properly capture and work with them at our disposal, it certainly is a very exciting time to be an innovator. Luke WinterCommunity Managerhttp://www.onedesk.com

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