The Rise of the Innovation Department

Companies of all sizes are organizing their innovation programs around their crowds these days. The reason for this is because a great deal of research has emerged that proves the power not just of valuable ideas, but connections between valuable ideas. That’s why companies use systems like IdeaScale where anyone (customers, employees, partners) can submit ideas, combine ideas, build on the ideas of others, and more. That sort of transparency has proven invaluable for fostering connections between promising themes, ideas, trends, proposals, and early-stage concepts. But to manage complex and powerful programs like that, more and more companies are starting innovation departments to manage the flow of ideas.

And IdeaScale’s annual research has confirmed that this trend is growing. Nearly 40% of IdeaScale’s customer base is managing their idea management program from an innovation department.  Other firms and forecasters are seeing this too, with Accenture reporting “there is  a gratifying increase in the number of innovation departments formalized within company structures.” This number has only continued to grow each year.

Like many emerging disciplines, however, there are some unique challenges for this new department. Here are some of the most obvious ones:

No Established Resources. The roles and responsibilities for the innovation department aren’t yet established, which means that many organizations aren’t sure what innovation teams yet: how many team members, which innovation skills do they need to develop, how much budget should be assigned to innovation programs. Unfortunately, if companies fail to assign adequate resources to these companies, it’s unlikely that the programs will succeed. New ideas need runway for testing and that runway requires money and people.

Developing Processes. For a long time, innovation was considered to be an activity that was exclusive to creators and inventors – and that it couldn’t be programmed or predicted. What innovation management has shown, however, is that good innovation is repeatable – but only when there’s a process for sharing and connecting ideas, building out and testing ideas, and socializing that success far and wide. An innovation department needs to provide process and structure to innovation as one of its responsibilities.

No Fixed KPIs. Finally, without a set of innovation metrics, innovation programs can’t track or articulate their value. As we’ve discussed in the past, there are a variety of things to measure from innovation inputs (like ideas generated and percentage of workforce trained in innovation) to innovation outputs (like revenue generated or customer sentiment improvement). Innovation departments need to decide what to track and then report on it regularly.

What do you think will happen next for the new innovation department?