As the saying goes, “The best time to start innovating was yesterday, the second best time is right now.” But are you asking yourself how?: “How do we come up with new ideas for our business? How do we know which ideas to pursue? And how do we execute these new ideas?” Or maybe your organization previously tried to start an innovation team, but it didn’t deliver on its objective and was quickly disbanded.
You are not the only organization in this position. Many organizations know they need to innovate to stay ahead of the competition, but either don’t know what to pursue or don’t have the structure in place to do so. There are several ways to overcome these challenges, but one of the most effective ways we found is through innovation labs. At Credera, we help our clients start innovation labs within their organizations, enabling them to ideate, prioritize, explore, execute, and implement the impactful ideas that will grow their business. In this blog series, we’ll walk through the basics of an innovation lab and what we have seen makes one successful.
What is an innovation lab?
An innovation lab is a set of processes, tools and frameworks, and a governance structure that uses agile principles and the innovation mindset to achieve outsized results.
Labs can be set up to create any type of product or service, including new physical and digital products, process improvements, and marketing campaigns.
What do you need to make an innovation lab successful?
While every lab is different, in our experience there are certain best practices that make some labs more successful than others. We believe there are five best practices:
Choose a strong executive sponsor.
Identify a fully dedicated, cross-functional team.
Find available subject matter experts.
Set a clear scope and well-defined goals.
Create a strong governance structure.
1. Choose a strong executive sponsor.
Every successful innovation lab starts with a strong executive sponsor. This person must be:
Bought into the innovation mindset.
Open to new ways of working and able to bridge the gap between the old and new ways of working.
Willing to give the team freedom to explore ideas and execute the lab’s operating model.
An advocate/evangelist for the team’s value throughout the organization—someone willing to expend social capital.
2. Identify a fully dedicated, cross-functional team.
The second key to operating an effective innovation lab is staffing the lab with a cross-functional team whose time is fully dedicated to the project. Depending on the goal of the lab, the lab can be staffed with individuals from one department, from multiple departments, or even from multiple business units. But no matter where the individuals come from, the team should include a diverse range of backgrounds, skills, and ways of thinking.
3. Find available subject matter experts.
In addition to the core innovation lab team, every successful lab needs a network of subject matter experts on call to advise and assist as needed. These experts don’t need to be fully dedicated to the lab, but rather act as advisors who are available to solve problems and provide recommendations in their area of expertise.
4. Set a clear scope and well-defined goals.
As important as having the right team is having the right goals. During the establishment of the lab, the executive sponsor, steering committee, and lab functional managers should create a clear scope and well-defined goals for the innovation lab, spelling out what the lab aims to achieve and how it will measure success.
5. Create a strong governance structure.
Lastly, every successful innovation lab needs a strong governance structure. This includes a thorough operating model outlining the lab’s processes from intake and ideation through prototyping, testing, iteration, and implementation. In addition to the operating model, the governance structure should include clearly stated objectives for the lab, and well-defined roles and responsibilities for the lab team members. Daily activities of the lab are typically overseen by an innovation leadership team whose responsibility it is to ensure the lab teams are operating efficiently, the operating model is being followed, and the lab is achieving its stated goals.
Taking your first step with an innovation lab
As you explore your need for an innovation lab, keep these best practices in mind at the beginning of the process. In an upcoming article we will explore best practices to help your organization avoid the common pitfalls that plague innovation labs.
If you would like to learn more about if an innovation lab is right for your organization, contact Credera at email@example.com to start the conversation and unlock the full potential of business innovation.