Innovation Australia: overcoming conservatism in the consumer age


2 September 2016

I have spent the last five days on a whistle-stop tour of Australian businesses understanding the Aussie approach to digital transformation and innovation. Visiting up to five companies each day it has been a fascinating journey of discovery but the overwhelming feeling I’m left with, and the word used time and again by those leading innovation in this great country, is conservatism.

This endemic cultural trait could be a significant barrier to Australia taking it’s rightful place on the global innovation stage. Plenty of lip service is paid to innovation and there are well funded (public and private) innovation programmes. Yet it feels like Australia is taking a deep breath before launching itself into the critical mission to compete globally in the decades to come.

Of course there are pockets of genius, so by way of acknowledging the people doing a fantastic job pushing the innovation agenda, whilst giving those taking a deep breath a step up, I have crystallised the initiatives I’ve seen underway in the Australian public and private sector into nine approaches to innovation.

And at the end of this article I’ll reveal the main un-locker to innovation in the companies I’ve visited.

1. Stand alone innovation team

The most common starting point for launching innovation efforts involves staffing an innovation team within the company of full time employees dedicated to developing strategy, managing, and activating innovation programs. These leaders are experts at internal communications, and are change agents. They can and do make a real difference to corporate culture and constructively challenge conservatism from the grassroots right up to the c-suite.

2. Centre of excellence

Similar to number 1 and often the next stage after a dedicated team has been created. Companies quickly learn that innovation can’t happen in a single group because without broader institutional digestion, new ideas will falter and fall. Some corporations are setting up cross-functional, multi-disciplinary groups to share knowledge throughout the company.

3. Intrapreneur programme

Rather than rely solely on external programs, internal employees — dubbed ‘intrapreneurs’ — are given a platform and resources to innovate. These programs invest in employees’ ideas and passions to unlock everything from customer experience improvements to product enhancements and full-blown internal startups that are then launched from within the company.

4. Open innovation: hosted accelerator or corporate incubator

Hosted inside a corporate office, a handful of large corporates are inviting startups to embed at their physical locations and provide them with funding, operational support, and other perks. This brings innovative startups inside a large company for everything from overnight hackathons to long-term programs. Other variations include online open-innovation programs that request — and often reward — ideas from the crowd.

5. Innovation field-trips

I’ve been asked more than once, as an entrepreneur, what would make me nervous about joining a large organisation because such organisations need people with an entrepreneurial mindset. My answer is consistently ‘being institutionalised’.

I learnt working at the heart of the UK government that you can quickly find yourself mirroring the language of the conservative naysayers. To prevent this, I recommend frequent innovation field trips (like mine to Australia) where you get the chance to tour innovative organisations, companies, and regions to discover trends in various industries, meet partners, and be inspired as you immerse yourself in innovation culture.

It has been brilliant to watch innovators in Australia learn from the early adopters around the world and skip some of the ‘zombie’ steps that have consistently prevented progress across the globe. Without a doubt, if conservatism is put aside, Australia could use this keen ability to learn and adapt to leap-frog the competition.

6. External accelerator

In this model, corporations partner with third-party accelerators to provide sponsorship and/or funding in exchange for relationships with startups and integration opportunities. Corporate innovation professionals often embed themselves in accelerator offices, fostering relationships with local startups.

7. Technology education, university partnership

Corporations are tapping into new graduates, early-stage projects and companies, and the network of an established educational institution. I met a number of super smart Australians with impressive academic backgrounds and deep knowledge of areas like human-centred design who are doing big things in their respective companies.

8. Investment

A handful of companies are placing bets among the startup ecosystem, with both small amounts for early-stage startups and larger amounts of corporate funding that yields market data, creates opportunities for follow-on investments, and blocks competitors. Most of these initiatives in Australia are at an early stage and many innovators indicated that the next 18 months is about scaling the pilot projects they have successfully invested in and seeking out more disruptive innovation.

9. Acquisition

Rather than build innovation from the inside, some corporations have acquired successful startups and then integrated them into their core operations. This approach can be fraught with challenges, especially the integration of cultures and is often very expensive. However, if the startup is already successful, and the acquisition can help the startup scale further it can certainly be a fast route to innovation in a slower moving corporate world.

The secret to unlocking innovation

The reality is that many large corporations are deploying a combination of the nine approaches above. However, there are two things that set apart the successes and failures:

  1. Even if they start out with models 1 or 2, without doubt the key to long term innovation is unleashing model 3 and creating a culture of intrapreneurs within your business, embedding innovation into your cultural DNA.
  2. And this always requires sponsorship and shepherding directly from the c-suite. If you have a brilliant person leading your innovation efforts that doesn’t mean too much time investment from the board. But giving a mandate to your innovation leaders and following that up with action and fast decision making is the number one differentiator in the companies I’ve seen nailing innovation this week.

I’m heading back to Europe today but hope to be back soon. So if you’re an innovator who’d like to hear more about my field trip or are willing to generously share your experiences, I’d love to connect.

With thanks to the ever brilliant Jeremiah Owyang for helping me articulate the themes I saw on this field trip.