“Innovation is the key to jobs, growth and economic vitality. That's a view that's becoming increasingly recognised both in business and beyond, and ever more attention is being focused on finding ways to foster and promote innovation.”
Those efforts received a big boost at last month’s 2011 Global Leadership Summit, when Deloitte’s Global Chairman, John Connolly, announced the launch of the Deloitte Institute of Innovation and Entrepreneurship at London Business School.
The Institute is the latest part of the School’s longstanding commitment to exploring innovation and represents a new level of involvement by Deloitte in the study of this critical area. As Mr Connolly told the summit, by many measures the UK is lagging in innovation, and the Institute is a significant step towards solving that problem.
The announcement about the Institute was just one part of a summit that explored the whole subject of innovation from many different angles and in close detail. Beginning with a poll that found that the audience’s favourite definition of innovation was “Fresh thinking that creates value”, the speakers and audience launched into the topic with gusto.
In his opening address, George W Buckley, Chairman, President and CEO of 3M, said one key to innovation was for company leaders to create an environment in which people can experiment and sometimes fail. He said that unless business leaders were personally involved in innovation, it wouldn’t happen, and that it can be done even in businesses you might think are dying.
Vince Cable, the Secretary of State for Business, Innovation and Skills and President of the Board of Trade, told the summit that, when looking at how to energise a sluggish economy, it was worth noting that innovation was responsible for around two-thirds of the growth in the UK economy, and that most of that drive came from about 10,000 middle-sized companies.
He said that although Britain was 50 per cent below the OECD average in terms of investment in R&D, it had an efficient research base and a cosmopolitan research community and was open to inward investment, all of which provided a firm base from which to boost innovation.
As a striking example of how innovation has the potential to make a huge difference, Shai Agassi, founder and CEO of electric vehicle infrastructure company Better Place, outlined the rapid progress his company and its partners have made towards making electric cars a mainstream cost-effective form of transport in just a few years.
Lively discussion dominated the summit’s panel sessions. One panel, featuring George Buckley of 3M, Nick Hughes of Signal Point Partners, Geoff Vuleta of Fahrenheit 212 and the LBS’s Gary Dushnitsky, examined the question of whether big companies can innovate. They concluded that they could, but that in most big companies innovation was not something that came naturally and therefore needed focused effort. “For by far the majority of companies, innovation is not part of the DNA,” Geoff Vuleta said.
Innovation has to come from the top, according to a panel on how to set the scene for innovation featuring Lloyds CEO Antonio Horta-Osorio, Philip Rutnam of the Department for Business, Innovation and Skills, Michael Hayman of Seven Hills and StartUp Britain, Philip Cullimore of Eastman Kodak Sarl and the LBS’s Phanish Puranam. It’s also crucial, they agreed, to accept that innovation means accepting failure. “Innovation is about new ideas, but most new ideas are bad ideas,” said Phanish Puranam. “The problem is how to cope with the failures.”
A third panel, on whether culture is stronger than leadership, featured vigorous exchanges among the participants, Matt Brittin of Google, Stephen Leonard of IBM, Sir Martin Sorrell of WPP, Deloitte’s Chief Executive Elect David Sproul and the LBS’s Rajesh Chandy.
A key condition for innovation, said Sir Martin Sorrell, was to have “a messy organisation”. “The 21st century is not for tidy minds,” he said. David Sproul said it was important to measure the time and effort that goes into innovation projects, the failures and the revenue stream from the successes.
The final panel session, on social innovation, featured Rodrigo Baggio of Brazil’s Centre for Digital Inclusion, Michael J Barber of GE, Amit Mehra of Reuters Market Light, Kamalini Ramdas of the LBS and Parminder Bahra of the Wall Street Journal Europe, and came up with strong arguments for the role and importance of social entrepreneurship.
Rodrigo Baggio set out an approach to motivation for all innovation, both social and commercial. “Life’s not about making money,” he said. “It’s about being fulfilled. Invest time in what inspires you.”
A similar approach emerged in a presentation by Fujitsu’s Marc Silvester and Masahiko Yamada about their company’s approach to innovation. “You have to be ambitious,” said Masahiko Yamada. “Ask yourself: are you changing the world, getting through the day or just making money?”
That kind of fresh thinking was just one of the many highly useful approaches participants took away from the summit, all of them valuable additions to the understanding of what innovation is and how it can be fostered. As the Dean of the School, Professor Sir Andrew Likierman, told the summit, given the challenges we face today, innovation is more important than ever.