Qindle in MT/sprout
Why more innovation often leads to less impact
Many large companies invest millions of euros in innovation. Yet surprisingly few ideas survive in the market. The problem? Not ambition, but the way companies have organized themselves. ‘The real challenge is translating what the market demands into what you can mobilize as an organization to respond to it.’
Innovation as the engine of renewal. Many organizations firmly believe this and claim to act accordingly. But in practice, their innovation teams surprisingly often function as system preservers. Not because they want to, but because the structure leaves them little choice. They rarely have the mandate to make fundamental decisions and turn out to be overly dependent on existing business units for budget, resources, and implementation. But why is that? ‘Many companies are built from isolated silos. Everyone operates from their own strategy, and ultimately nothing really connects. There’s plenty of experimentation, but rarely any real follow-through,’ says Taco Schmidt, co-founder of Qindle, that helps organizations connect strategy, technology, and brand into one coherent value proposition.
Why traditional innovation fails
The reflex of many organizations is to invest even more in innovation. More labs, more teams, more pilots. But that often makes the problem worse, Schmidt argues. ‘The core of this problem isn’t the number of initiatives, but the way the system is set up. Most innovation teams don’t have their own P&L, for instance. They don’t have to prove that something actually generates revenue, and that makes the innovation process too non-committal.’ According to Schmidt, what often emerges is a form of – what he calls – innovation theater. It looks like a lot is happening, but real impact is nowhere to be found.
He attributes this to three persistent patterns. ‘First, it feels safe to add new ideas, but no one dares to cut existing activities because of entrenched interests. On top of that, innovation teams are too dependent on other departments, with different priorities, for execution. The result is that ideas get watered down in a bureaucratic process. And finally, the wrong things get rewarded. KPIs drive activity: the number of pilots, ideas, and experiments. When really, it should be about actual impact,’ says Schmidt.
Jasper van Eck, Strategy Director at Qindle: ‘In Europe, innovation is often treated as an end in itself. While real innovation builds hard IP at the core of the business, in practice it’s often treated as a standalone incubator. An add-on to the company. Start by establishing what the driving force of your organization actually is. From that foundation, you can build an IP roadmap that genuinely connects to the core of your business.’
Internal fragmentation and achieving market validation
More innovation, then, is not always the answer. Because the more standalone initiatives emerge, the less connected they are to strategy, portfolio, and execution. What’s missing above all is coherence across those initiatives. ‘And that’s not the whole story,’ says Schmidt. ‘Even when strategy, technology, and commercial operations are well aligned internally, that doesn’t mean the market will follow.’ The real challenge, in his view, is twofold: addressing internal fragmentation and achieving market validation. The two reinforce each other. ‘Without internal alignment, external signals never reach the right place. But without market validation, that internal collaboration is built on assumptions. You’re aligning around a need that may not exist at all. The real challenge is the translation between what the market demands and what you can mobilize as an organization to respond to it.’
Concrete market-driven value
This is where things often go wrong in practice. Innovation gets aligned internally, but never translated into something directly relevant to customers. He cites a project at Philips as an example. ‘An integrated strategy was once developed there, bringing together brand, sustainability, digitalization, and supply chain. Internally, it all added up, and everyone was on board. And yet it stalled,’ Schmidt recounts. What was missing, in his view, was the translation into concrete business value. As a result, the investments never really materialized. ‘You see the contrast in reverse too. Take a company like Intel. A new chip was once brought to market from the ground up with a sharp, consistent value proposition. Everyone in the organization understood what it was about, and that consistency made the difference. Not the technology itself, but the way it was connected and translated.’
Systemic innovation
More and more organizations are looking at a different approach to innovation, known as systemic innovation. This doesn’t mean adding yet another innovation department, it means changing the system itself. A few guiding principles:
- Make sharper portfolio choices, including what to stop doing
- Restructure governance, who actually has the decision-making power?
- Shift budgets toward the areas that create real impact
- Revisit your KPIs: are you rewarding activity or impact?
- Treat innovation not as a standalone track, but as an integral part of the business
Innovation as connection, not as a department
What’s the most important takeaway? Schmidt doesn’t need long to think about it. ‘As long as your organization sees innovation as a separate column, little will fundamentally change. The real value lies not in standalone initiatives, but in connecting strategy, portfolio, and execution, and then translating that into the market.’ That requires a different lens, he argues. Not: how do we set up innovation better? But rather: how do we make sure everything is connected? ‘That’s why we work horizontally across organizations,’ says Schmidt. ‘So that vision, business strategy, brand, and execution actually connect. That connection isn’t an organizational trick — it’s a strategic competency. The ability to bring different perspectives together and turn them into something that works.’
Read the article in Dutch here
