What is innovation governance?

Sep 17 2012, 03:55 IST
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SummaryInnovation governance provides a frame that defines the mission, focus and implementation of innovation in the company. It addresses questions dealing with both content and process.

Jean-Philippe Deschamps

Managing innovation effectively involves mastering a number of processes—from idea generation to project management and commercialisation—across functions, disciplines, or even companies. At the same time, it requires promoting a culture that channels creativity, stimulates entrepreneurship and encourages teamwork. The role of top management is to combine ‘hard’ business processes and ‘soft’ people factors through an effective innovation governance system. Innovation governance is not a task that can be delegated to any single function—innovation is inherently cross-functional—nor is it one that can be delegated to the lower levels of the organisation.

Innovation governance provides a frame that defines the mission, focus and implementation of innovation in the company. It starts with establishing a set of policies regarding the scope of innovation and addressing a number of questions dealing with both ‘content’ (i.e. projects) and ‘process’ (i.e. approaches and responsibilities).

In many companies, management behaves as if innovation dealt only with the development of new technologies and products. It ignores or at least underestimates the importance of other types of innovations. Therefore, innovation governance must fight this misapprehension and promote and steer all aspects of innovation. Defining innovation broadly means at least three things for senior managers: enriching projects through multiple innovations; paying attention to all the specific processes within innovation; and combining top-down and bottom-up innovation.

As part of its governance mission, management must ensure that their company innovates across all aspects, not just in technologies and products. More importantly, they need to remind the organisation that sustainable advantages often come from combined, mutually-reinforcing innovations. It is important to establish a process whereby project teams are required to think through and propose innovations in all aspects of their product, including business model, process, offering and delivery.

Thinking broadly about innovation means going beyond the traditional focus on new product development projects. Innovation governance execute effectively all the critical, albeit fuzzy, upstream processes—starting with an immersion in the market, the identification of opportunities and the generation of ideas to exploit them. It implies also to focus the organisation on the disciplined downstream processes that conditions success in the market by way of the product launch, roll-out and customer integration.

Some companies, particularly in the US, are known as archetypical bottom-up innovators, meaning they rely heavily on the creativity, imagination and entrepreneurship of their staff. Others, particularly in Asia, favour ambition-driven, top-down innovation. In these companies, leaders search for and target opportunities, then align the organisation to

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