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Nine emerging trends in the management and support of innovation

The ways in which we innovate have evolved dramatically over a generation.

The big laboratories in firms and governments that pioneered scientific and technological advances such as the laser have been superseded by more open, collaborative models allowed by advances in digital technology. Despite significant changes in innovation, government policies to support and manage this process are sometimes not well suited to the 21st century. To help counter this mismatch Nesta has been at the forefront of codifying, developing and spreading novel innovation methods from challenges prizes to innovation mapping.

Yet we are aware that new ways of managing and supporting innovation are emerging on the periphery. Nesta has started a rapid horizon scan of these novel approaches with the innovation practice Brink. Here’s what we’ve uncovered so far. These emerging signals will be honed in the next step of our work - interviews with innovation leaders and insights from you, the wider innovation community.

Trends

The first set of trends are about the ways emerging digital technologies are enabling new innovation processes.

Trend 1: AI is reinventing the way we invent - The greatest impact of artificial intelligence (AI) may not be through widely known applications like driverless cars or image recognition but through altering the process of innovation. Fields such as material science and medicinal chemistry face the challenge of identifying and understanding huge numbers of compounds. Generative adversarial networks can assist by pitting AIs against each other to help find answers, as is being done through In Silico Medicine’s and Neuromation’s approach to drug discovery. Other ways in which smart machines are helping with innovation include BenevolentAI’s use of natural language processing and AI to analyse structured and unstructured scientific data.

Trend 2: Machines are getting creative - Advances in AI are giving machines the ability to create novel designs rather than simply optimise existing solutions as had been done in past. This process of digital generative design involves innovators providing machines with goals and constraints from which solutions are generated through a process that imitates biological evolution. At the forefront of this approach is the company Autodesk that collaborated with NASA’s Jet Propulsion Laboratory, to explore new approaches to designing an intra-planetary lander. Digital generative design is aided by additive manufacturing that allows the rapid construction of some of the products conceived through this process.

Trend 3: Open innovation is going micro - The innovation process and large innovation challenges are starting to be broken down into smaller challenges in an evolution of open innovation. This micro open innovation is gaining traction because the open innovation system is now large enough to sustain smaller challenges, which are more attractive to individuals who want to learn, develop portfolios and do not have access to substantial teams or resources. It can also allow more iteration and faster results. Micro open innovation has been successfully used by General Electric’s platform Genius Link to reduce the weight of an aviation component by 84%, and at NASA to develop this video for the RFID-Enabled Autonomous Logistics Management (REALM) project.

The second group of trends are organisational innovations that are spurring innovation.

Trend 4: Efforts to remove bias from funding decisions - There is increasing recognition that the current system of funding new ideas can be biased with mixed gender founder teams making up a lower proportion of investments by venture capitalists than the pitchdecks (proposals) venture capitalists receive. In response, novel methods of decision-making are being explored that can make innovation funding not only fairer but also more efficient and support bolder ideas. Funders are starting to use these tools to override their biases and explore fairer ways of supporting innovation.

Fairer methods of funding in the public and charitable sectors include randomisation where elements of innovation resourcing have been distributed by lottery such as at the Volkswagen Foundation or UKRI. Other approaches include collective allocation which is currently being explored in the Netherlands and involves funding being evenly divided with a proportion then allocated to others by individual researchers. In the private sector, Fuel Ventures has starting trialling anonymous pitchdecks in an attempt to avoid unconscious bias.

Trend 5: Distributed and adaptive innovation teams - Innovation leaders are starting to galvanize people around challenges in small, relatively autonomous multidisciplinary teams that are coordinated more through shared mission, culture and principles than traditional management hierarchies. This more distributed way of organising offers flexibility and is more suited to tackling complex problems than direction from the centre. Examples build on Spotify’s well known squads and chapters models that are interpretations of Laloux’s ‘Teal’, or self-organising systems implemented on a team level in Pepsi, or company-wide in Klarna last year.

Trend 6: ‘Firefly’ companies - Decentralised Autonomous Organisations, or DAOs, are companies powered by automated smart contracts on the blockchain such as Digix. These entities can routinely and rapidly form and close down autonomously (i.e. without any human involvement). Enabled by this new technology, firefly companies may become a way of rapidly prototyping organisations that will be capable of testing new markets and capturing value from them without any human intervention or overhead.

The third group of trends are about priming the ability of individuals to innovate.

Trend 7: Mindset is being emphasised over method - As the number of innovation methods multiply and our understanding of the innovation process matures, there has been growing interest in the mindsets required by innovators and innovation leaders that allows them to adapt to fast-changing and uncertain contexts. The shift away from a purist focus on methodology is illustrated by Stanford d.schools move to teaching design thinking mindset and principles rather than “the” process of design thinking. Other examples of the mindset approach include Mercy Corp’s use of SCARF, a brain-based model for collaborating and learning with others, Strategyzer’s latest research project to quantify the seemingly softer stuff of innovation, and States of Change that focuses on the behaviours and cultures that enable innovation in government.

Trend 8: Organisations are attempting to foster neurodiversity to spur innovation – Neurodiversity, where neurological differences, such as autism and dyslexia, are recognised and respected as much as any other human variation is gaining traction as a feature not a bug for innovation teams. This builds on the growing recognition by companies like Slack of the importance of diversity not only for moral reasons but also to strengthen innovation.

Fuelled by their belief that innovation comes from the edges, the German software multinational SAP pioneered neurodiversity in their hiring and support practices through the Dandelion Principle. Now neurodiversity is being incorporated into the recruitment practices of the likes of Microsoft, Ford and EY as an enabler of innovation. Neurodiversity forms part a wider move to apply insights from neuroscience to innovation, such as through neuroleadership discussed below.

Trend 9: Neuroscience is shaping leadership development - Deeper understanding of our neurology, powered in part by new measurement tools such as such as Bitbrain’s neurotechnology sensors, is being used to develop the skills of innovation leaders and help them better navigate complexity and uncertainty. New forms of training and development designed to improve awareness of findings from neuroscience include Lab Of Misfits’ immersive masterclass experiences.

We would like your help…

These are the early results from the first stage of the scan. We’re sharing this as a prototype - an early version of what will become our finished product. Over the coming weeks we’ll be interviewing luminaries from across sectors and geographies, from NASA to Unilever, and from Shenzhen to Nairobi, to really get to the edges of what practices and methods are showing promise in the ways we manage and support innovation.

What else should we be exploring for the future of innovation support and management? If you can help answer this question then get in touch with [email protected]

Definitions

By ‘innovation management and support’ we mean programmes and instruments designed to encourage, manage and improve innovation processes. By ‘trends’ we mean innovation methods that have hit an inflection point - an uptick in how much they are being used, or where they are being applied in new contexts.

Sources

The literature scan covered sources in three domains: business, civil society and government. Within each domain the scan considered:

  • Academic journals e.g.: Research Policy, SSRN
  • Blogs e.g.: Nesta, IDEO, McKinsey
  • Briefings e.g.: PWC, IBM
  • Conference papers e.g.: for the 2017 NBER conference on AI
  • Corporate reports e.g.: Unilever
  • Databases e.g.: OECD innovation policy platform
  • Institutional reports e.g.: Global Innovation Index
  • Innovation press e.g.: Harvard Business Review, Quartz
  • News media e.g.: Financial Times
  • Platforms e.g.: Apolitical
  • Social media pulse e.g.: Twitter
  • Trend reports e.g.: Design in tech, Trendwatch

The scan was supplemented with informal discussion with Nesta staff and external experts.

Brink

For this horizon scan Nesta have collaborated with the innovation practice Brink because of their experience of innovation leadership across the private, public and third sector.

Brink is a team made of strategy, psychology, coaching and tech expertise with the core belief that whether your goal is shareholder return in Silicon Valley or social impact in Kathmandu Valley, the key to tackling our biggest challenges is blending innovation methods with the right mindsets and designing an enabling environment. This blend of method, mindset and enabling environment is the lens that’s informing our research together.

Acknowledgements

We would like to thank Kirsten Bound, Celia Hannon, Ruth Marshall-Johnson and Geoff Mulgan for their advice in preparing this blog, along with many other colleagues and experts from Nesta and beyond.

Author

Abi Freeman

Abi Freeman is a Founding Partner at the company Brink.

Laurie Smith

Laurie Smith

Laurie Smith

Principal Researcher, Explorations

Laurie contributes to Nesta’s thought leadership on future technologies and trends, analysing the technological, social and economic aspects of emerging developments.

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