Innovation can arise from several sources e.g. individuals, firms, research institutes, non-profits and/or the linkages between them. But what makes some individuals or companies more innovative than others? Is it the creativity of the individuals and therefore for companies HR policies matter the most in this regard? Of course it does matter, but other things count too.
One popular theory is that of Professor Ronald S. Burt on “structural holes”, which refers to two independent social networks with missing links in between them. So knowledge in one network does not flow to the other. Since innovations mostly utilize existing technologies/ideas and use them in a different context, innovations and good ideas are likely to be coming from individuals and/or companies which bridge the structural hole between two independent knowledge networks. These individuals and companies can be referred as knowledge brokers. One classic example is the Edison laboratory where innovation resulted from the engineers’ prior knowledge of electromagnetic power from the telegraph industry, which they applied in lighting, telephone and mining.
Another example is design company IDEO. By the nature of their work, designers are exposed to a diverse set of industries which are often unaware of the technological progress in others. They often act as a knowledge brokers, utilizing the ideas from one industry and applying it to another (where it can be usefully applied). This may result in an innovative product.
However, if you are not a design company how will you take advantage of such a privileged broker position?
One possible way forward would be relying on your employees exposure to the outside world. They do have diverse backgrounds and interests but often they are unaware of the problems faced by the other colleagues if they are not in the same team. This is where culture and technology can play a role. It is common knowledge that to foster innovation requires a culture in the company where employees are not afraid to ask for help, they know failure is a part of the process, managers emphasize on valuing others ideas and building on them… Given the right culture, what is needed is a idea management tool where ideas and solutions to known problems are stored and become part of organizational memory. So that they can be retrieved whenever required and the innovation process can be systematically managed.
If we think how much money and effort companies put in their own R&D, if even a very small percentage of it is allocated for facilitating idea exchanges across the company, it could have drastic results for the company.
(Originally published at http://www.vaibmu.com/sources-of-innovation/)