Priya Kannan-Narasimhan, University of San Diego – Innovation in Large Organizations

How can large companies excel at innovation?

Priya Kannan-Narasimhan, associate professor of management at the University of San Diego, determines the key may be looking at what they’re already succeeding in and doing it differently.

Kannan-Narasimhan holds a PhD in management from UCLA’s Anderson School of Management. She teaches strategic management and innovation management. Her research focus is on innovation and corporate entrepreneurship. Her latest research was published in February in a special issue of the Strategic Management Journal focusing on how innovators shape their organization’s strategy to get their innovations adopted. She also has published in FT journals and top innovation journals such as Strategic Management Journal, Organization Studies, Journal of Product Innovation Management and R&D Management and has won recognition for organizing showcase symposiums at the Academy of Management Conference.

Innovation in Large Organizations

When I ask groups of executives if their companies excel at innovation, fewer than 10 percent of them raise their hands.  How can large companies excel in launching new ideas in the same way lean start-ups do?

Following dozens of interviews with Silicon Valley managers and executives, our research shows the key to success for innovators is not only to come up with great ideas but to show how they fit their companies’ existing strategies. If you can reframe your organization’s unique competencies to show why your ideas fit and how you can deliver better value than your competitors, most decision makers will endorse them.

At one firm, for example, an innovator recalled the resistance he faced after proposing a new idea for virtual reality videoconferencing. His managers responded the company’s core competencies were in printing, not movie production. But when he responded with saying that movies are printing pixels on screen, his superiors realized they were in a unique position to provide value for their customers.

Decision makers in organizations do not view innovation the same way venture capitalists do. Middle managers and decision makers in large companies know they will not be fired for doing nothing but could be fired for doing something innovative that fails.

Innovators must minimize the risk for their decision makers. They can do this by showing how well their idea fits the organization’s existing strategy and creates unique value for customers.

Employees and managers need to think of their organization’s assets not as fixed but as flexible and applicable to many new ideas. This is the key to success in innovation for large organizations.