There is a popular myth that innovation only happens at the edges. That startups are the only ones who can develop breakthrough innovations. But the evidence tells a different story.
In Driving Innovation From Within, Kaihan Krippendorff draws on Wharton research examining the top innovations of the last three decades. More than 70 percent of these innovations were conceived, developed and commercialized by employees inside large organizations. This finding can be surprising to many.But there are real benefits to innovating inside an established company:
- Brand: Startups are virtually unknown and are building up their brand reputation. Most established companies have a well known brand with a strong reputation.
- Resources: Most startups, particularly in the early stages, have limited resources and access to human talent. Established companies often have access to large financial resources and world class talent.
- Market: Startups are usually fighting to grow their market position and access to customers. Most successful companies have an established market position with access to customers.
Having these three benefits is something that a lot of startup founders are looking for. Their job as founders is to create and grow these benefits within their startup. If you are innovating in an established company, you have access to these benefits from day one.
However, these advantages are often locked behind organizational boundaries. Access is not automatic. It has to be earned.
Innovation Inside Organizations Is A Buy-In Problem
I have worked with many innovation teams that are physically separated from the core business, insulated in labs and proud of their distance from corporate politics. This separation feels entrepreneurial, but it quietly undermines the reason for innovating inside a large organization in the first place.
If you are not tapping into the brand, the resources, and the market, you are not benefiting from being in a large company. You are simply running a startup with less freedom and more internal friction.
To get access to the benefits of innovating inside an established company, you have to build relationships.
In other words, you have to create buy-in. We say that buy-in exists when people believe an initiative is legitimate and worth supporting and when they actively contribute time, energy and resources to its success.
Without buy-in you get resistance or indifference, which can lead to failure. When you have buy-in, sales opens doors to customers, marketing helps with crafting narrative campaigns, finance provides oxygen, legal removes friction and HR enables scale. These functions are often treated as obstacles to innovation, but they are how innovation becomes successful.
Building these relationships early turns corporate advantages into real leverage.
The Paradox of Corporate Innovation
To benefit from innovating inside a large organization, you must be good at two things at once: entrepreneurship and relationship building.
You have to experiment under uncertainty while building legitimacy and coalitions across the organization. Ignore entrepreneurship and you don’t create breakthrough innovations. Ignore buy-in and you cannot launch and scale your ideas. You have to be good at doing both.
This is how you can benefit from innovating inside a large company.