10 Tips for Creating Distinct-but-Linked Innovation Groups

Conventional wisdom suggests you should isolate innovation from the core — separate the new from the old. But this approach misses the important advantage that big corporations can bring to innovation. Global companies own mammoth assets and capabilities that innovation initiatives must leverage. GE Healthcare in India innovated a $400 portable ECG machine by leveraging GE's vast reservoir of knowledge about ECG technologies that reside in their R&D center in Milwaukee.

Based on our research my colleague Chris Trimble and I have found that for successful execution of innovation, companies must adopt a distinct-but-linked organizational model. Under this model, a company builds a dedicated team for an innovation initiative, and then creates processes and incentives so that the dedicated team partners with, rather than fights with the company's performance engine, which is the core business.

Here are ten tips to nurture a strong partnership between innovators and the core business:

1. Articulate a motivating vision of victory in which both the dedicated team and the performance engine win.
2. Highlight the reality that the dedicated team and the performance engine are mutually dependent.
3. Create a common enemy: the competition.
4. Reinforce the values that the dedicated team and the performance engine share, even if they are simple and universal values, like a commitment to integrity.
5. Make the division of responsibilities between the dedicated team and the performance engine as clear as possible.
6. Anticipate resource constraints created when the shared staff must simultaneously handle the demands of innovation and ongoing operations.
7. Gather data to understand whether fears about cannibalization are valid or unfounded.
8. Alter incentives. Specifically evaluate "ability to collaborate across organizational boundaries" on performance reviews.
9. Use influential and collaborative insiders at points of interaction between the dedicated team and the shared staff.
10. When the innovation initiative succeeds, share credit liberally, with both the dedicated team and the shared staff.

How well is the partnership between the Dedicated Team and the Performance Engine working in your organization? What actions have promoted the partnership?