How to Create a Culture of Product Innovation

by | Mar 1, 2022

Why building innovative, new products requires more than a commitment to creativity

The fear of building new, differentiated products

culture of innovation

Building something entirely different to your competitors and the rest of the market feels slightly terrifying. As we’ve previously discussed, the gravitational pull towards doing what’s ‘normal’ i.e. what everyone else is doing, is so strong that it can have a major stifling effect on your team and business’ ability to bring new products to market.

You may have sat in a room or on a call where the agenda is innovation and whilst everyone is sharing ideas, one or two ideas sound so outlandish that the person sharing it laughs to themselves about it. These are sometimes just bad ideas, but they’re also often the source of true innovation.

As the old adage goes ‘first they ignore you, then laugh at you, then they say you’re crazy and then you change the world’. OK, sure, maybe you’re not going to change the world, but the point is that innovation, by its very definition, means you’re going to attempt to do things differently – and lots of us don’t like change, or doing things differently. It feels uncomfortable. Stepping out of your comfort zone doesn’t feel safe. It’s far easier to stay within the confines of the boundaries of acceptability defined by years of corporate inertia. Easy it may be, but we’re not aiming for easy. We’re aiming for something different.

The 3 elements of innovation-oriented product companies

  1. Cultural
    • Freedom to explore – the freedom to share ideas without unfair critical judgement
  2. Practical
    • Idea generation – idea generation is encouraged and facilitated
    • Cross pollination talks – cross pollination sessions to create new connections between previously disconnected industries and concepts
    • Shark tank / Dragon’s Den pitches – new concepts and ideas are regularly pitched internally
  3. Structural
    • Innovation oriented team structures – to bring ideas to life, teams need to be structured in a way that facilitates the building of new products.

Cultural innovation

The freedom to explore and generate ideas without unfair judgement is essential for a product company that wants to foster an innovation-oriented culture.

If an employee knows that every time they generate a new idea they’ll get berated or shot down, that will of course, have a knock-on impact on the likelihood of other employees to generate and share their ideas too.

What a culturally innovative company looks like

  • New ideas are regularly celebrated.
  • Innovation inside and outside of your market is highlighted and shared with the rest of the company.
  • Team members are encouraged to seek out new technologies and explore creative ways of using them.

Without a culture of innovation, you’ll fail to take any innovative ideas to the implementation stage since many employees won’t bother to participate in the idea generation in the first place.

 

 

Practical innovation

It’s one thing to talk about having an innovative-oriented culture, but quite another to implement the practical processes that facilitate it.

 

Practical ways to create an innovation-oriented culture

Ideas Slack channel

Consider creating a Slack / comms tool channel that is specifically focused on ideas only. At any time during the working week, anyone can post an idea they have. You could agree on a set template for this or make it an informal free for all where members of the team can randomly pitch ideas.

Whilst you may keep the structure loose, there should be clear criteria for what is allowed to be submitted. These ideas should be a distinct category of their own: ideas for innovative, new products and not for customer service issues or bugs.

At the end of a work week, if you have weekly demos, you can use them as an opportunity to read out all the ideas submitted that week and celebrate them.

You don’t have to immediately do anything with these ideas in the first instance. The purpose of this is to create a culture of idea generation by practising a habit of generating new ideas.

Later, you can feed these ideas into your strategic decision making sessions, including your product council, for example.

Google's 8 pillars of innovation

Google’s 8 pillars of product innovation innovation

Google exec Susan Wojcicki outlines Google’s 8 pillars of innovation. Download the full document here.

 

  1. Have a mission that matters
  2. Think big but start small
  3. Strive for continual innovation, not instant perfection
  4. Look for ideas everywhere
  5. Share everything
  6. Spark with imagination, fuel with data
  7. Be a platform
  8. Never fail to fail

Idea hackathons

Just as you’d do with standard hackathons, your teams could set aside dedicated time to do nothing but explore and generate genuinely bold, new ideas that could be brought to market.

Setting aside an entire day or two of the company’s time feels scary but the truth is, the energising effect that these days can have often outweighs the potential loss in productivity.

A “10 ideas a day sprint” sprint

The 10 ideas a day sprint is a concept where team members are asked to create 10 new ideas every single day. This sounds a lot simpler than it is and it’ll feel uncomfortable, but the critical thing here is to get team members into the habit of generating new ideas and to kickstart their brains into creation mode rather than consumption mode.

10 ideas relating to your product or business have to be generated every day for 5 days straight. They can be submitted or written down privately, but the ideas must be created. No matter how bad people may think they are.

After the 5 days, in a team of 20 people you’ll have over 1000 ideas. Keep the format of ideas standardised and these can be fed into a central document later for analysis.

Cross pollination talks

Some of the best ideas are generated by forcing connections between two previously unconnected products.

Tinder took the swiping motion used for viewing galleries on iPhones and turned it into a dating decision.

Amazon took Apple’s iPod / iTunes model and applied to books.

NFTs take the concept of real world collectibles (Pogs, Pokemon, trading cards, stamps) and applies them to the blockchain.

One way to force connections is through the use of ‘cross pollination’ talks.

Cross pollination is the process of bringing together two previously disconnected ideas to create something entirely new.

Cross pollination talks can include people both from within your organisation and outside your organisation to help people form new, creative connections which can spark innovative new ideas.

If you work in the fintech space, invite speakers from the edtech industry to share insights about how their industry is building products.

If you work in ecommerce, invite folks from Web3 crypto projects to understand how new technologies could potentially impact your space.

The powerful part of cross pollination talks is forcing yourself to create new connections. You could even ask the speaker to work with you before their talk to consider how to practically apply the concepts to your own industry.

Idea generation vs. idea curation

The role of a product manager is not just in generating ideas (often, most ideas don’t come from the product person), but in curating those ideas too. The challenge for product teams will be to decide which ideas to pursue.

The usual way to assess ideas is by using a bunch of frameworks to help guide decision making and forums like the product council.But what if you could use something a little different?

Shark tank style pitches

If you really want to shake things up, try introducing a Shark Tank / Dragon’s Den style pitching panel.

This can work by creating a formal process for pitching ideas to a panel who will then assess the idea, just as potential investors would do on the TV show.

Clearly, this wouldn’t be a suitable forum for ideas in their early stages and is more suited to ideas that have been fleshed out in more detail. But the format makes things more interesting than some of the others – plus, you can mix up the panel so that it’s not just the highest paid people.

Imagine a panel of six people which includes a lead engineer, a sales executive, a customer service representative and the CEO all debating on potential pitches from product teams.

Structural innovation

If your teams are not structured in a way that enables ideas to be taken to the next level – and ultimately built – then innovative ideas won’t really matter.

Let’s explore two approaches to creating structural innovation: one views innovation as deeply centralised and another attempts to decentralise it.

A centralised approach to innovation could see the creation of dedicated teams whose sole focus is on brand new product development.

This approach sometimes manifests itself through initiatives such as innovation hubs or lean startup teams who operate within existing corporates. But the idea is that innovation is a neatly carved out discipline that is the focus area of only a select few team members.

For the members who are part of that team, life is fun. They’re free to explore new technologies, create MVPs of new, exciting products and come up with alternative ways to solve problems besetting the company.

You could even take the centralised approach a step further by appointing a Chief Innovation Officer role, designed to be a representative and cheerleader for new product initiatives.

The ups and downs of a centralised approach

This approach can work in larger corporations with thousands of employees. It’s almost impossible to not do innovation in this way in companies of this size.

Examples of product innovation labs

 

Amazon's Lab 126

Amazon has its Lab126 R&D Unit, a team “that designs and engineers high-profile consumer electronic devices”, responsible for the Kindle and Echo.

 

Airbnb's in house lab

Airbnb has an in-house lab called Samara to work on ideas beyond apartment rentals.

 

Hive smart home lab

British Gas created a dedicated lab to build out its Hive smart home technology.

Carving out a dedicated team in this way that interacts with the wider business but is solely focused on exploring new ideas and delivering innovative new products can result in some truly groundbreaking products.

 

However, there are plenty of reasons to be cautious:

  • Not my problem – once you introduce a team dedicated to it, innovation is seen as someone else’s discipline – just like marketing or sales, the rest of the business views innovation as a separate department. Something that they have no business getting involved in.
  • Friction – the innovation teams are often seen to be given the freedom to operate slightly outside the boundaries of the rest of the business which can cause internal friction. Some companies will adopt a stealth approach to innovation to prevent other teams knowing exactly what the innovation folks are up to.
  • Corporate inertia – what often happens in large corporates who attempt to create innovation hubs is that new ideas get generated, everyone gets very excited about them and then when they move to the execution phase they become stuck in internal processes which slow everything down to a grinding halt. One way to combat this is for senior execs to carve out entirely separate, fast track processes that allow innovation teams to circumvent standard procedures. This does, of course, come with a lot of risk.

Ultimately, a centralised approach has many flaws but it can work – and if nothing else, these types of teams can help create new technologies that will then be used in other parts of the company. For example, the technology used in Amazon’s failed Fire Phone was eventually used in creating the Alexa.

 

The decentralised innovation set up

In a decentralised set up every team is responsible for delivering innovation – or at least considering how they might build innovative, new products. It’s everyone’s responsibility.

This approach expects product teams to approach problems with an entrepreneurial mindset and not leave innovation as something that the innovation lab deals with instead.

In this set up, you could consider some of the following:

  • Innovation roadmap allocation – teams could be asked to consider how innovative their roadmap is by asking critical questions about the features included. Are we first to market? Is this sufficiently differentiated? How easy is this for competitors to copy? Why would this excite our customers? This is likely to happen anyway, but formalising it can help to bring more focus. Teams could be tasked with allocating a set % to innovation each quarter.
  • Innovation time allocation – product teams are given time each week or each development sprint to consider how to make their products more innovative and differentiated.
  • Internal press releases / blogs – building on the Amazon approach of writing a press release, product teams could be responsible for their own ‘news’ feed on the official company blog. The press releases / blogs are used as a place for celebrating innovative new products. By giving teams a platform to celebrate the new innovative products they’ve created, this may spur on future creativity.

The downsides of decentralised innovation

Without a formal team dedicated to thinking about and building innovative products 24 / 7, innovation can become an afterthought. Sure, the roadmap may already include a bunch of creative ideas but the lack of focus can mean the day to day workings of building products means it gets forgotten about.

 

 

Bringing it all together

For tech leaders, innovation is often cited as one of the top challenges facing their business. It is extremely difficult for companies to fully keep on top of new emerging technologies. And for many leaders, this doesn’t mean just understanding new, emerging technologies, but more importantly – how new emerging technologies and market conditions can be translated into compelling product offerings to customers.

Luckily, with a strong culture that fosters idea generation, creativity and execution, innovation-oriented product teams should be in a position to do just that.

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