Discover multiple paths to success


Today’s business landscape is rapidly evolving, driven by data and emerging technologies. Innovation—a word used perhaps too freely—is at the center of it all. While it’s simple to say you keep innovation at the forefront, it seems the larger an organization becomes, the more difficult it is to artfully innovate. This is because creating and sustaining a culture that drives innovation can be challenging. Certain organizational structures can slow down the exchange of information, impacting the decision-making process. Incentives can become misaligned, failing to encourage and reward innovative behavior. Many companies also make the mistake of designing from the “inside-out,” forgetting to keep client needs in mind. 

But sustaining innovation is critical in a constantly changing world where clients want real-time responsiveness. So, where do you start? 

Define the problem

Necessity is the mother of invention. This common saying goes to the heart of the issue. We don’t innovate for the sake of innovation; we innovate to solve a problem, or at least, we should. 

Examine what’s needed before innovating. Start with a specific problem. Why focus on this issue? Has no one solved the problem or is the existing solution not good enough? How does this problem connect to the organization’s business strategy? Need is not sufficient; the solution must be tied to the company’s overall business vision. Move forward if the answers lead you in this direction.

Multiple paths to innovation

Innovation is often attributed to smaller, entrepreneurial organizations, but large organizations can be innovative, too. Their size is an asset because it comes with more resources and options. Large companies have a variety of innovation options available: purchasing a solution, collaborating with organizations with developed solutions, or creating the solution in-house.

If there is a viable solution in the market, explore this option with careful analysis. Is it an appropriate fit and will it enhance your client offerings? Is the timing right in the market? Is there internal alignment with your product teams? Using internal and external resources such as in-house experts, industry thought leaders, and client input can help you determine if this is the right approach. 

When to partner

When partnering with a company that has a complementary product, think about whether to combine your strengths for a unique solution.  

Internal corporate venture capital and business development teams can help your innovation approach, as they can identify early-stage companies to bring innovative solutions. To be successful, first define the investment and partnership criteria. Most important is discipline in scope and in the number of investments. Try to avoid scope creep by limiting investments to adjacencies or products that could enhance your core offerings. 

When to build

Partnering and purchasing existing solutions helps mature organizations meet clients’ changing needs, bringing enhanced solutions to the market quickly. While this seems counter to the traditional innovation concept, I would argue they are a core tenet to an effective innovation strategy for mature companies. 

However, there are certainly critical business cases that call for building a solution from scratch. I’m a firm believer that companies should dedicate a percentage of their R&D budget to this work, focusing on solving problems in new ways, to help the organization and its clients. These are some guiding principles I always consider: 

  • Identify an executive champion. It is crucial for an executive team member to believe in the project. They can help clear obstacles, identify funding, and ensure the project remains true to the organization’s strategy. 
  • Define success stage gates. Stage gates are important because they help keep the project on track and allow for the team to pause and review. When a stage gate is not met, the team can work to understand the root causes. Is it a lack of funding? Do you need different talent working on the project? Does it fit the market? 
  • Install a kill switch. The beauty of innovation is that it’s okay to fail. Every project needs clear criteria for when to stop moving forward. The working team and executive champion should agree on the criteria.
  • Set approval rights. Establish your core team of approvers and ensure there are individual representatives for each major area, including finance, project management, marketing, product design, and architecture.
  • Expedite decision-making. Agility is key to innovation; delayed decisions can quell teams’ innovative spirit. Any decision affecting the working team that takes longer than a week should be escalated to the executive leader. 
  • Keep the development team small and nimble. Sometimes too many people can be a problem. Keep the working team to less than 20 until the proof of concept or early designs are ready.
  • Spread out project controls. In a large company, it’s easy for projects to get tangled in the organizational chart layers. Decide which projects should be managed centrally versus in a decentralized way with lighter controls. For example, have only two or three big projects managed centrally, and several smaller projects managed in a decentralized manner. This allows for multiple wins throughout, as bigger, centralized projects take more time. 
  • Launch only when you’re ready. You get one chance in the market so make it your best. The most important piece is ensuring your product is bringing unique differentiation to the market.

While the art of innovation is unique for each company, success for larger enterprises often lies in a hybrid blend of approaches. The key is choosing the right path to accomplish each unique mission and meeting your organization and clients’ needs. 

Sreeni Kutam is president of global product and innovation at ADP.