In my previous blog in this series, I shared the key components needed for an Innovation Funding Board (IFB) to function effectively, including the importance of establishing what success will look like at the outset. Now, I’ll break down the innovation process itself—and the key stages needed to take a great idea from initial inception through to full implementation.
There are many ways that the innovation process can be approached, depending on the ultimate goals of those involved. The method described in this blog uses a build/test/learn approach to encourage a lean startup mentality amongst project teams. There are four main phases involved: Ideas; Rapid Evaluation; Incubation; and, finally, if a project is successful, Implementation.
As a project moves between phases, its accompanying business plan will undergo continuous refinement until it’s completed, de-risked, and ready for implementation at the end of the process. Let’s look at each phase in a little more detail:
The starting point for any new project is the Ideas phase, where the innovation venture teams consider longer-term ideas and shape them into meaningful concepts for the IFB’s consideration. Input at this stage can come from many sources, including strategic organizational priorities, customer insights, co-creation opportunities, and more.
Any project proposals deemed good enough by the IFB to warrant further exploration move to phase two: Rapid Evaluation. At this stage, initial funding is granted, buying the venture team a limited period of time (usually two to four weeks) to stress test the core concepts and establish whether it’s a good idea or a great idea. Peer reviews will often take place in the rapid evaluation phase, as well as low-fidelity testing of killer issues. Ideas deemed to be merely good should be killed at this stage to make way for truly great ideas.
Projects that make it to the Incubation phase have been thoroughly stress tested and proved to have significant commercial viability. At this stage, the first funding tranche is made available to the venture team and an experimental plan is agreed on with the IFB. It’s then down to the venture team executing against the agreed on plan and deciding how and when to return to the IFB for progress reporting and further funding. At any point during this phase, the team and IFB can decide to pivot based on new learnings, persevere with the current project direction, or kill and celebrate learnings made.
Finally, if the IFB approves the project for full Implementation, it will transition out of the IFB process to standard governance processes used within the wider organization.
A Note on the Importance of Ongoing Evaluation
Throughout the entire IFB process, the importance of ongoing evaluation cannot be overstated. Not only does it allow for accurate measurement of the quality of the idea, but it also helps to ensure the innovation process is being followed properly at all times.
There are many ways evaluation can be done, from scoring of opportunities against pre-defined metrics to tracking key variables such as the number of hypotheses developed, or customer engagements taking place. Whichever methods are chosen, evaluation should be both thorough and regular.
In my last blog of this series, I’ll share the important final considerations to think about before implementing an IFB and summarize key learnings that can help every organization get its innovation back on track.