Scott Anthony penned an article in the Harvard Business Review last year titled ‘The New Corporate Garage’.
Anthony reviews the past three eras of innovation:
- 1st Era – The lone inventor/innovator.
- 2nd Era – The assembly line & the rise of the corporation.
- 3rd Era – The VC-backed start-up.
He then introduces the fourth and current era of innovation, the rise of the ‘corporate catalyst’. These catalysts are motivated individuals within a large company that have the leadership skills to utilise the benefits of being within a large company (e.g. brand, distribution channels, networks, experience with regulators, partnerships etc.) to tackle and solve large global problems. Their solutions are just as much a business model innovation as a product innovation. To me these corporate catalysts seem to be a type of ‘intrapreneur’. The rise of such individuals has led to companies finding themselves in a better position to exploit an opportunity than the small, agile start-ups of the previous era.
Anthony states that this era change (third to fourth) is being driven by three trends:
- cost of innovation is low and competition is high,
- embracing open innovation and less hierarchical management,
- innovation is targeting business models
Being an employee within a med-large (by NZ standards), science research company (which also has a long history) I can certainly see how such 4th-era innovation can come about. Given the size and long history of the organisation, I find myself having access to a plethora of resources (extensive R&D capability, technology, knowledge, networks, relationships, money), something that a smaller enterprise is devoid of.
Thus when approaching a problem or opportunity, rather than simply offering some research services to a small enterprise, I assess how I can best utilise my company’s resources more holistically. I want to understand how I can ensure that the overall problem is being solved or opportunity is being captured with maximal impact. For example this could mean utilising my companies relationships with organisations throughout an industry to establish a more secure and reliable supply chain, or identifying technologies that I could in-source from other industry partners to make Product X even better. This I would say is only a slither of what characterises fourth-era innovation.
While I can see fourth-era innovation is certainly happening around the globe (an example in the article is Medtronic), I don’t know whether it defines an era yet. It’s simply to early to tell. At present it seems that fourth-era innovation is a trend only evident in a handful of organisations and we eagerly await for it to be adopted by others.
For now, I suggest you download a copy of the article and have a read, it is well worth it.