4 Pitfalls for Scaling Up an Innovative Solution from Experimentation to Scale-up
🔥 To transition from experimentation to scale-up is a Herculean task for many organizations. Too often successful experiments end up with only local and temporary victory, failing to reach their full potential. They are stuck in the infamous stagnation chasm of the innovation process
, which exists for four primary reasons: the funding gap, the talent gap, the context gap, and the capability gap. In correspondence to these 4 gaps or challenges, organizations can leverage 4 enablers to succeed in the endeavor to industrialize their innovative solutions.
4 Scale-up Gaps and Enablers
- Funding Gap
The first pitfall and enabler for fruitful scale-up is funding, which includes four key elements.
1. Time to market: Time to market is a central element of funding because any innovative solution has an expiry date — it may not be valid forever on the market and there is a window of opportunity that has to be captured in time.
2. Non-monetary benefits: Besides the typical monetary benefits such as ROI, there are equally valuable non-monetary benefits that can be reaped from innovative solutions, such as developing brand, attracting and retaining talents, setting a foothold in a new market, etc. When we have an innovative solution, we should never assess the business case only from accounting perspectives, or else many promising opportunities will slip through our fingers.
3. Risks: Benefits from innovation tend to be echoed in the involved risks, but sometimes nothing is riskier than not to take on a task due to its opportunity cost. scaling up Innovation is one such task that often entails extravagant opportunity cost. The relevant questions we need to ask ourselves are "What happens if we don't deliver the new solution?" and "What if our competitors bring it to the market instead of us or before we do?"
4. Innovation adoption cycle: The innovation process must take into account the life cycle of how innovations are adopted. For example, the "Early Adopters" and the "Earlier Majority" of the famous innovation adoption curve represent two dissimilar populations of users with different expectations. Only after these differences are thoroughly explored and understood can we develop the right strategies and apply them in the implementation of innovative solutions.
- Talent Gap
The second enabler to industrialize innovative solutions is talent, which encompasses four all-important aspects.
1. We must be fully cognizant of the context change — from broad autonomy to a regulated environment. The experimentation of a new solution usually involves a team of a few talents who collaborate autonomously; while the scale-up of the solution could employ tens or even hundreds of people who work together within a strictly regulated environment with, say, project management gates, financial governance, and so on. There is obviously a significant change in context when innovation proceeds from experimentation to diffusion, which has to be scrupulously allowed for when setting up proper teams of talents so that the transition could be less strenuous.
2. We need an innovative sponsor and management. Among the talents required, one of the most vital roles is the sponsor, who has to be a visionary capable to motivate people with an innovative vision. Most of all, the sponsor has to be comfortable with uncertainty and novelty. Another critical role is the management, including team leaders, I.T. directors, etc. They have to come to terms with their new responsibilities in innovative initiatives that are different from traditional ones — they need to serve and support rather than manage and control in order to get ahead in innovation.
3. We need to develop or bring in missing skills. Almost every innovative initiative requires the development of new skills, as there is always something new (a new system, new technology, or a new distribution channel, etc.) for which we don't have the skills or talents yet. One way to address this problem is to leverage our partners — not by outsourcing innovation, but by collaborating with our partners like startups or academics who have the appropriate skills that we are missing — in order to accelerate our learning and speed up our innovation process.
4. We must engage idea and experiment owners. What happens to the people who were involved in an idea or experiment initially? Are they still there when we industrialize? The answer should be "Yes." They still have a vital role to play when we scale up because keeping the same people on board can ensure the required continuity between experimentation and industrialization. We don't want an entirely different group of people to take charge of delivering the innovative solutions without them involved in the ideation and experimentation phases — they don't understand the specific context and can lack the passion or even the interest in doing the work.
- Context Gap
The third enabler for innovation industrialization has to do with context: Are we able to transpose the context, in which the ideas have been thought of and the experiments have been validated, into a different and broader one when we scale up? The change in context brings about two points of attention — consideration of other application domains and interactions with other systems.
Consideration of other application domains is a natural part of scale-up. Take, for instance, a public transport operation company that has had a successful experimentation of installing a service status board in certain metro stations to better inform the users. In order to bring the experimentation up to scale, the company will have to ask questions concerning other application domains, such as "Will it also provide value for streetcar stations or bus stations?" and "If it works in New York, will it also work in Boston?"
The other important point of context is how the initiative of industrializing a solution can interact with other systems, for example with other technologies currently used, with people who are not working on the initiative, or with the existing processes. We need to think about whether there are resources from these other systems that we can share, whether the industrialization of an innovative solution would render part of the current systems obsolete, and so on.
- Capability Gap
The last enabler that can help an organization to scale up innovation is its capability, which covers its infrastructure, platform, IT Systems, and its production processes, and so on. Lacking any of them will impede the organization from delivering real value through innovation. So, we need to ask ourselves whether our organization has all the required capabilities to bring its innovative solutions to scale. If not, how can we build them with both quality and speed?
If an organization has validated some value hypotheses in experimentation that doesn't guarantee that it is well equipped to industrialize its innovation. There's a long way to go from experimentation to scale-up. Only when all the above 4 enablers are properly tackled is the organization able to successfully cross the stagnation chasm and deliver true value to all of its stakeholders.
Collet, B. (2019). "Agile leadership" (Online course).
Rathbone Results Ltd., "3 Challenges Companies Face When Growing/Scaling-up".
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