One of the advantages of being a large, multi-division company like IBM or Johnson & Johnson is that keeping your innovation capability in fighting form without distracting the company from the current winning business model becomes a matter of portfolio management.
With a company that defines itself by a single line of products or services, paradigm shift inevitably disrupts the current business. And because paradigm shift is how we distinguish innovation from improvement, a single-threaded company that is enjoying strong growth playing by the rules of its current business model is right to err against changing those rules in the near term.
That means the answer innovators in such companies often receive even for very good ideas is, “Let’s wait and see.” Not fun for innovators who, no matter how good the current business is, want to try something different.
But in a highly diverse business like IBM – what I would call a strategically aligned conglomerate – there is always some part of the overall business that is facing a clear and present threat. The core competency of such companies is not on one specific business or business model but rather on managing a portfolio of options. So for lucky innovators in strategically aligned conglomerates, there is always something to do, some business that needs to be reinvented.
A strategic conglomerate can focus innovators where real innovation is needed without throwing the whole company into a spin. Managers in parts of the business that don’t need to be transformed at the moment can nominate those employees who are happiest “changing the rules” for innovation projects in other parts of the business that do need transformation.
Anyone in the company can get onto these focused, innovation “seal teams,” but not everyone in the company needs to – or even wants to – be actively involved in paradigm shift all the time. This “focused fire” strategy keeps innovators in the company, honing their skills as game-changers, while leaving improvers to further improve how the company plays the games it is currently winning.