Some interesting conversations happened over the last few weeks that resonated with some of the main insights we have had into how innovation may happen in large organisation - and maybe also why not. An often overlooked elephant in the room is that he way large organisations are structured creates big barriers for innovation. Already in 2002 Theodore Levitt said in a HBR article: "Organizations, by their very nature, are designed to promote order and routine; they are inhospitable environments for innovation." This is also something that Shoshana Zuboff has dedicated much of her research to, essentially stating that the voice of both consumers and staff never really get onto the leadership radar as there are too many filtering layers - and no one is encouraged to pass along "bad news". As a consequence, senior executives are often blissfully unaware that they might have some rather burning platforms in their company - and that is why many a corporate innovation effort addresses the wrong questions.
The cost of complexity is astounding as a recent HBR article by venerable management scholar Gary Hamel states: "More people are working in big, bureaucratic organizations than ever before. Yet there’s compelling evidence that bureaucracy creates a significant drag on productivity and organizational resilience and innovation. By our reckoning, the cost of excess bureaucracy in the U.S. economy amounts to more than $3 trillion in lost economic output, or about 17% of GDP."
This might explain the recent popularity of the lean start-up movement with large corporates - because as Seth Godin said: "Small is the new Big." What makes things difficult for start-ups that are funded by old school venture capitalists is the obsession with "scale". But luckily there is a changing mindset emerging which we really like. This is driven by likes of Paul Jarvis in his approach called the Company of One: "What if the real key to a richer and more fulfilling career was not to create and scale a new start-up, but rather, to be able to work for yourself, determine your own hours, and become a (highly profitable) and sustainable company of one? Company of One is a refreshingly new approach centered on staying small and avoiding growth."
This refreshing take on the Gig-Economy and Future of Work will be a theme that we will discuss in posts to come.