Boards, CXO’s and the Risk of Innovation

Why does so much innovation not get adequate IP and other legal support, often until it’s too late to adequately secure the innovation?   Too many companies seek to limit risk of fruitless innovation by limiting time, attention, and financial support.  Instead, they risk innovation gone bad.

Sometimes the board and senior management have never thoroughly committed to systematic innovation and these pockets are simply spots of employee creativity that occasionally percolate up from the bottom, often with a self-conscious managerial tolerance of the “odd” engineer, technologist, or marketing creative.

Perhaps more commonly, the board and senior management have committed strategically to innovation and yet misunderstand the innovation process as mystical but Darwinian: they squeeze the innovation culturally, including financially, to see what survives. They believe that the squeeze limits their risks.

Whichever the approach, both are scattershot, rarely financially productive. and can be a recipe for later legal nightmares because no one has invested the time and attention necessary to think through the legal protections, even the freedom to operate, as the innovations have evolved.

Despite a decade’s discussion of innovation and the board, we have seen too many companies mired in exactly the problem McKinsey’s Marla Cappozzi identifies here: the little pockets of unscalable, inchoate, poorly supported innovation within the larger organization. Listen to your engineers, bring in industrial designers, and dial up counsel.

© 2013 S. Caroline Schroder. All Rights Reserved.
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