Capgemini: Innovation Centers Are Not Delivering

A recent report by Capgemini’s Digital Transformation Institute showed that building innovation centers are not necessarily helping firms to become innovative.

The report, called The discipline of innovation: Making sure your innovation center makes your organization more innovative, surveyed 1,700 employees at 340 firms to find out how well innovations centers are helping them to stay innovative.

The report noted that despite the massive investments poured into innovation centers; many are struggling to create innovation-centered cultures. Without the right internal processes and leadership, the results of these centers are falling flat.

While 87% of those surveyed have an innovation center, no firm has reached "optimized" maturity. In fact, half of the surveyed business leaders felt that their firms are unable to keep up with market changes, and less than a fifth (17%) thought they have a company-wide culture of innovation. Most firms (76%) were still at the "building" stage of their innovation efforts, with projects being run solely at departmental levels and with no central management.

The main hurdle to reaching maturity, the report noted, was the company culture and lack of engagements with vendor and partner communities. Previous reports indicated that the same issues—culture—was also the reason for digital transformation failures.

"Organizations need to accept that they cannot just open innovation centers and expect an overnight transformation in their creative output. To achieve and sustain real change, firms need to create a culture in which all employees are encouraged, through financial and non-financial incentives, to experiment and push ideas to market,” Lanny Cohen, Global Chief Technology and Innovation Officer of Capgemini and member of the Group Executive Committee, said.

Four out of 10 respondents also said that their processes and technology were not aligned to enable interactions with partners. Concerns over sharing data with third parties and fear of losing their competitive edge are other reasons why firms are not interacting.

In contrast, innovative firms are 13% more likely to take part in internal and external collaborations with start-ups, academia, and other industry partners. Also, firms with higher innovation maturity are 25% more likely to have flexible processes.

“Innovation units can play a large role in this process, partnering with individual teams to develop 'out of the box' ideas and provide a link to the partner and vendor ecosystem. However, a sense of innovation and creativity needs to be instilled company-wide if it is to be truly successful," Cohen said.