In this chapter we explore how an organization arranges itself to house innovation: where innovation sits in the structure, the enablers it requires, how units can work together rather than each in isolation, and who leads this effort. We take the university as an applied case whose thread runs through later chapters.
One university has what many organizations aspire to: a business accelerator, a Fab Lab for digital fabrication, an innovation oasis, research centers, a program for gifted students, and a Deanship of Student Affairs that organizes competitions. Each of these units has its own plan, indicators and annual reports. Yet a student survey showed that many students did not know these units existed, and those who did saw no connection between them and their courses. Assignments in most courses measure the ability to answer exam questions; a student with an idea does not know where to take it; and each unit waits for students to come to it.
This university has all the inputs. What it lacks is the architecture that would bring these units together into a single ecosystem reaching students where they learn. That architecture is our concern in this chapter: how an organization arranges itself so that its side-by-side entities become an organizational capability for innovation.
After studying this chapter, the reader should be able to:
An innovation initiative may succeed thanks to an enthusiastic leader or an exceptional team, but that does not mean the organization has become capable of innovation. Organizational capability shows itself when the flow of opportunities, experiments and implementation is supported by a structure of roles, resources and relationships that endures when the organization’s standout members move on, and through which innovation is spread across the whole organization. This is why the international standard defines the innovation management system as the organization’s means of developing and demonstrating its innovation capability (ISO, 2024).
When innovation stalls, organizations tend to blame a shortage of ideas or a lack of employee enthusiasm. It is more useful to ask about the architecture: Does innovation have a clear place in the structure? Are its enablers in place? Do units work together? Does the system reach people where they work?
Organizations follow one of three models in organizing innovation, each with its strengths and limits. From their study of large firms pursuing radical innovation, O’Connor and DeMartino concluded that building the capability for it requires turning scattered efforts into a clear organizational function (O'Connor & DeMartino, 2006).
A particular form of the centralized model, the innovation lab, has spread widely in the public sector. A study of 35 government labs found that the motives for setting them up included tackling complex problems and technical challenges, but also imitating other agencies and seeking legitimacy (Tõnurist et al., 2017). A lab created because others have created one, or to make the organization look innovative, risks remaining an input with no output.
Wherever it sits in the structure, innovation needs enablers that are a precondition for its work. An organization’s declared support for innovation remains incomplete as long as people are innovating with the same resources they use for their routine work.
| Enabler | What it means | Sign of its absence |
|---|---|---|
| Time | Protected time for exploration within official working hours | “Innovate once you’ve finished your tasks” |
| Skills | Understanding beneficiaries, formulating hypotheses and designing experiments, alongside generating ideas | Repeated brainstorming workshops with no progress |
| Data and tools | Access to data and to prototyping and testing tools | Teams waiting months to obtain data |
| Spaces | Places for collaborative work and experimentation, close to people | An elegant space in a remote building that no one visits |
| Networks | Connections to experts and partners inside and outside the organization | Every team starts from scratch |
| Funding | Funding that increases in step with the evidence | Either no funding at all, or large early funding with no stages |
Time deserves particular attention, because it is the scarcest and most overlooked of the enablers. Amabile and her colleagues analyzed the diaries of 177 employees and found that time pressure undermines creative thinking when people feel they are on a treadmill or working on autopilot, whereas creativity remains possible under pressure when people feel they are on a meaningful mission, know its purpose, and are protected from distraction (Amabile et al., 2002). The issue, then, goes beyond the amount of time to its meaning: do individuals feel that their time is directed toward a clear purpose, or spread across scattered tasks that never end?
Many innovation opportunities lie in the gaps between organizational units. One unit may carry a burden created by a decision in another; an employee may re-enter data because systems are not integrated; a beneficiary may wait between two service points because ownership of their journey is fragmented. Each unit may look efficient on its local indicator, while the overall journey remains slow.
This does not mean that the answer is more meetings and joint committees. Hansen showed that collaboration between units has a cost, that it pays off only when its expected value exceeds that cost, and called for disciplined collaboration: collaboration measured by the specific result toward which it is directed (Hansen, 2009). Productive integration between units requires:
The opening case returns with a practical question: how can the university’s side-by-side units become a single ecosystem? The common response is to set up a new unit in charge of “innovation.” The risk is that this unit becomes a seventh isolated entity alongside the other six. A better alternative is an orchestrating unit that reports to senior leadership and works in the background. Its function is limited to connecting the existing units with one another and connecting all of them to the student, without owning initiatives or competing with those units.
At a university, integration can take several possible forms, depending on what the diagnosis reveals. Three pathways stand out:
We return to these pathways in the chapters on the innovator and their environment, adoption and scaling, and innovation ecosystems, and then bring them together in Chapter 20 on the university innovation ecosystem.
An ecosystem is built by designing the flow between its entities more than by adding new ones. The question that reveals the quality of the architecture is: how many steps does an idea’s owner need to take to reach someone who can help?
The orchestrating unit needs someone to lead it. Many organizations assign this to an innovation officer who goes by various titles: director of the innovation unit, head of innovation, or chief innovation officer. The role carries a paradox: its holder is responsible for results that are mostly achieved within units they do not head, by people who do not report to them. Their success is therefore measured more by their ability to make others succeed than by what they carry out themselves.
The chief innovation officer’s role is consistent with the logic of the orchestrating unit: they build capability and leave ownership of ideas with those who originated them. Table 6.2 sets out the main domains of the role, what the officer takes on in each, and what they would do well to avoid.
| Domain | What they take on | What they avoid |
|---|---|---|
| Strategy | Works with leadership to formulate search fields and the level of ambition, and translates them into understandable priorities | Writing the strategy alone, or copying it from another organization |
| Portfolio | Manages gates and staged funding, and ensures a reasoned response to every idea | Owning initiatives in place of their originators, or deciding on them unilaterally |
| Enablers | Provides tools, skills and protected time, and removes procedural obstacles | Becoming the organization’s only source of ideas |
| Connection | Connects units with one another, and connects the organization with partners and beneficiaries | Competing with existing units through parallel programs |
| Measurement | Measures flow and impact, and learns from failure | Measuring their success by the number of events and competitions |
| Communication | Tells the story of what is achieved and credits it to those responsible | Attributing success to their own unit |
The OECD identified six core skills for public sector innovation that public servants need to varying degrees, and that those who lead innovation need to a greater degree: iteration, that is, developing solutions through rapid rounds of prototyping and testing; data literacy; user centricity; curiosity, that is, seeking out new ideas and different perspectives; storytelling, that is, explaining change through a narrative that builds support for it and links the past to the present and a possible future; and insurgency, that is, challenging the status quo, working with unusual partners, and treating setbacks as opportunities to learn (OECD, 2017).
The chief innovation officer’s position between units adds a critically important competency: influence without authority. Cohen and Bradford argue that such influence rests on exchange: the person making a request understands what the other party cares about and what they can offer in return, whether resources, information, support or recognition, so that the relationship shifts from a request to a partnership (Cohen & Bradford, 2005). Those who lead innovation by instruction alone usually obtain formal compliance; exchange is more likely to generate commitment.
The chief innovation officer also needs to place on leadership’s agenda issues that were not there before. Dutton and Ashford described this phenomenon and named it issue selling: the efforts employees make to direct senior management’s attention to issues they consider important and to shape how management understands them (Dutton & Ashford, 1993). A later study identified three sets of moves that distinguish successful attempts: packaging moves, such as linking the issue to the organization’s goals and presenting it in the language of results and cost; involvement moves, such as building a coalition of supporters before the pitch; and process moves, such as careful preparation, choosing the right timing, and combining formal and informal channels (Dutton et al., 2001). A good idea presented at the wrong time, or in language that does not speak to leadership, may be rejected even though it deserves acceptance.
When someone is put in charge of innovation, it is tempting to start with a visible program that proves their presence: a competition, a platform or an award. It is wiser to understand before building. They can map the internal ecosystem using the tool presented in this chapter, listen to leadership, units and beneficiaries, look for successful efforts already under way, and agree with leadership on a clear mandate and defined decision rights. Then they can choose one or two initiatives that address a problem everyone acknowledges, use them to produce early evidence of value, and earn the trust on which to build what comes next.
Draw a map of the units that support innovation in your organization. For each unit, note what it offers, who actually benefits from it, its connection to people’s everyday work, and its connection to the other units. Then look for three signs on the map: a unit unknown to those it is supposed to serve, two units offering the same service, and an idea that finds no clear path from one unit to another.
| Unit | What it offers | Who actually benefits | Connection to everyday work | Connection to other units |
|---|---|---|---|---|
| Business accelerator | Incubating entrepreneurial ventures | A limited number of proactive students | Weak: no link to courses | Limited |
| Fab Lab | Prototyping and fabrication tools | Students from some engineering colleges | Moderate | No link to the accelerator |
| Gifted program | Enrichment programs | Those enrolled in the program | Separate from students’ majors | Limited |
| Colleges and courses | Formal learning | All students | They are the everyday work itself | Do not refer students to any unit |
| … |