Expanding Impact: How Brands Are Innovating With Their Ecosystems
Today, innovation typically occurs inside of the R&D room, often in secret. Every few moons, white smoke appears from the chimney and a new product pops out. It’s often an incremental update but, hopefully, the market will want it. You, the marketer, must take it to market.
In the future, fluid innovation offers a new, bold path. Advanced companies churn out many new offerings with the ideas, prototypes and concepts coming from a wide set of employees, partners and startups. You, the marketer, support this process from the start and enable them to take it to market. It’s messy, open and collaborative–and, ultimately, more effective.
The product roadmap is shortening. Companies can no longer wait months for R&D to ship out a product, as the digital landscape is changing at such a rapid pace. Yesterday’s technology partners–like Amazon, Google and Apple–can quickly become competitors. The avenues to market are also changing, as interfaces and methods of interaction quickly evolve.
Yet, large companies are traditionally complex and slow; our survey of large corporations uncovered the number one innovation challenge was “fostering an internal culture of experimentation and innovation.” Getting approvals from all areas of the organization isn’t feasible or efficient. Savvy corporations have shifted to nimble practices to achieve impact more quickly, such as agile methods, sprints or approved “innovation sandboxes” 1 for teams to experiment and deploy in.
Another challenge for those deploying an innovation charter is to involve a broader ecosystem of inputs during the collaboration process at the top of funnel. Held accountable to a myriad of stakeholders, they must tap external and internal sources–employees, startups and customers–to ensure they receive the right market feedback, and they must involve partners along the way. Companies that innovate in a vacuum not only risk being slow, they also risk alienating the ecosystem by not getting their buy-in early on and, worse yet, build a product the market doesn’t really need.
Marketing departments have a key role in the innovation process. They often have relationships with the broader market, own the go-to-market process and know how to effectively communicate internally, to partners, and externally to other groups.
Below are best-in-class examples of how large companies are innovating with impact, beginning with marketing, and involving their ecosystem in the process.
A common first step for marketers is to activate innovation within their own department. These teams have been dubbed “marketing innovation” or “interactive/digital marketing” and are on the forefront in understanding how to connect to customers using new technologies. In a recent interview with the Coca-Cola marketing team in Bulgaria, we discussed their chatbot “Red” that interacts with users on popular messaging app Viber. This app has a clear marketing purpose in activating customers to obtain a discount code, triggering a true call to action.
Innovation shouldn’t be limited to a small team within marketing. It needs to be enabled, empowered and amplified across multiple groups–with impact being measured departmentally and to the company at large. As referenced in Impacting Tomorrow’s Workforce, employee communications should apply an outside-in mentality and focus on teaching people where the category is headed, what leaders are thinking about and what their colleagues could teach them about getting better results. Last season, Clorox hosted an internal conference for hundreds of its global marketers in San Francisco. Many speakers and I shared remarks around new business models and other cutting-edge practices. They also hosted an innovation fair showcasing the latest technologies from their top partners. Throughout the event, the marketing innovation team spread their message on how to best advance the many brands at Clorox and provided a venue for peer-to-peer learning among the global marketers.
Companies that activate their employees (beyond the R&D group) to innovate are dubbed “intrapreneur” programs. Intrapreneurs are similar to entrepreneurs, but inside the company 2 . As an example, Adobe’s famed “Kickbox” program allows any employee who has an idea to improve products or customer relationships, regardless of role or function. This unique training program enables employees to learn the basic methods of innovation, A/B testing and pitching a business proposal (with data) to their direct manager. This “gamification” of innovation can be especially effective with Gen Z cohorts. Intrapreneurship often results in feature improvements, new products and patents.
Crowdsourcing new product and marketing ideas isn’t anything new, but what’s really important is the bigger trend to embrace customers to help market and design products and contribute to the go-to-market process so they feel connected, offer better ideas and are more integrated with your brand. For several years, GE has been a leader in this space with their early crowdsourcing experiments with startups that enable customers to submit new product ideas and even share in the rewards. Today, GE has expanded to their GE Fuse program 3 , where customers can submit new ideas to improve GE products. They even offer a crowd-service potentially for your own company, called GE Geniuslink, which generates revenue for GE. Consider the technology implications and integrations needed to quickly act on crowdsourced ideas, while also tracking impact across business units.
We found that the most advanced companies in innovation enabled their entire ecosystem to innovate with them, for them and around them–and shockingly, in the case of Johnson & Johnson, even supporting companies that could be competitors in an effort to improve the entire health space. Johnson & Johnson’s JLABS consists of nine physical locations around the globe which offer million-dollar medical equipment, physical labs and offices for health and biotech startups to rent. JLABS focuses on treating the ecosystem just and fairly, and it does not require equity or IP sharing of the startups that are renting space. JLABS executives have said they strive to structure a personalized relationship that is equitable, in the hopes of building a long term relationship with the ecosystem. As Rowan Chapman, head of Johnson & Johnson Innovation explains, “What we’re trying to do is personalize that partnership to the external innovator. We try and do the right thing, we’re not going force anybody to do one thing or another. It’s personalized.”
- Be goal-driven. Put business goals first, then ask employees to come up with new ideas and self-form teams as intrapreneurs. Mastercard’s innovation team put forth a requirement of innovation projects having a minimum of $1 billion in business impact.
- Build relationships. Chances are, an innovation team exists within your corporation––in addition to any “marketing innovation” group. You’ll need to build a close relationship with them, provide them with market intelligence and go-to-market brand support, and they’ll keep you in the loop. Be careful not to “squash” their new ideas, or they’ll clam up and resist telling your teams about progress until it’s too late for input.
- Activate internal communications. This is a core skill that marketing teams inherently know. Mastercard has a small team of employees whose primary function is to conduct video interviews with global innovation project leads, recording their stories and communicating them to other business functions. Activate internal comms to not only spread the news of successes (and failures), but also to teach employees how innovation can impact their category, leadership and KPIs. With the rise of Gen Z in the workplace, it’s essential that internal communications strategy empower them to find solutions for business objectives.
- Democratize innovation. Make sure it’s equitable for all parties to participate in the innovation process. Use widely accessible digital channels like mobile apps and internal social networks (e.g., Slack) to offer advice and track progress. Tie rewards, promotions, equity and revenue-based bonuses to innovation performance. We found that many employees value recognition and the ability to feel empowered in their career.
- Enable ecosystem connections. When working with outside partners and startups, structure the deals so they can benefit from a large company’s resources: access to a global supply chain, production capability, global marketing and brand association. Startups seek investment, IP, access and other deals that you should structure on as-needed basis. Invite them in via open innovation and allow access to your APIs. This may require some data sharing, so be sure to consult with your IT department and related decision makers for advice.
The most advanced open innovation programs, which activate the entire ecosystem, allow for startups and competitors alike to win––in the mindset that “common tides raise all boats.” Translation? If every company in the industry is innovating at their best, it will push others to innovate more rapidly and disruptively, ultimately benefiting all. Supporting the broader ecosystem will result in your company becoming the central player for the market, with innovation orbiting around your company.
1 “Your Guide to Innovation and Design Methods.” Web-Strategist. April 2017. Source: http://www.web-strategist.com/blog/2017/04/04/a-sample-of-corporate-innovation-methods/
2 Kaleido Insights found in a survey of large companies that 50% had an intrapreneur program in place which activates employees to generate new product and service ideas to solve customer needs. Source: The Corporate Innovation Imperative, Kaleido Insights, 2017.
3 ”Working The Crowd: This Fuse Will Set The Collective Brain On Fire” GE Reports. April 2017. Source: https://www.ge.com/reports/working-crowd-fuse-will-set-collective-brain-fire/
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