𝐈𝐧𝐧𝐨𝐯𝐚𝐭𝐢𝐨𝐧 𝐢𝐬𝐧'𝐭 𝐚 𝐝𝐞𝐩𝐚𝐫𝐭𝐦𝐞𝐧𝐭, 𝐢𝐭'𝐬 𝐚 𝐭𝐲𝐩𝐞 𝐨𝐟 𝐩𝐫𝐨𝐣𝐞𝐜𝐭

👉 84% of executives say innovation is critical to their growth strategy, yet only 6% are satisfied with their innovation performance (Department of Innovation).

A recent McKinsey study of over 1,000 executives reveals a massive paradox:

👉 60% of companies are freezing or cutting innovation spend

👉 Yet a third expect over 25% of their revenue in 3 years to come from products that don't exist yet

I've personally seen innovation talked about but, in practice, it often doesn't happen. The structure isn't in place and the culture stymies risk taking, rather than encouraging it. 

𝐒𝐨 𝐰𝐡𝐚𝐭'𝐬 𝐭𝐡𝐞 𝐩𝐫𝐨𝐛𝐥𝐞𝐦? 

Organisations often treat innovation as a function, instead of what it actually is - a distinct type of project that requires different management, different metrics, and different expectations around failure.

Innovation doesn't come from a special team locked in a room with beanbag chairs. It comes from giving the organisation the space to run high-risk, experimental projects with the understand that most will fail. 

𝐒𝐨 𝐡𝐨𝐰 𝐬𝐡𝐨𝐮𝐥𝐝 𝐲𝐨𝐮 𝐚𝐩𝐩𝐫𝐨𝐚𝐜𝐡 𝐢𝐧𝐧𝐨𝐯𝐚𝐭𝐢𝐨𝐧?

Research shows that the most successful companies use the 70/20/10 Portfolio rule. They don't treat all projects the same but, instead, manage a balanced portfolio of risk:

✔️ 70% Core: Incremental improvements to existing products (Low risk, predictable returns)

✔️ 20% Adjacent: Expanding existing capabilities into new areas (Medium risk, new growth)

✔️ 10% Transformational: Creating entirely new business models for new markets (High risk, exponential returns)

Most companies are 95%+ in the Core. 

But that 10%. is where the future will be invented. And it requires a different mindset, one that embraces failure.

𝐖𝐡𝐲 95% 𝐨𝐟 𝐈𝐧𝐧𝐨𝐯𝐚𝐭𝐢𝐨𝐧 𝐬𝐡𝐨𝐮𝐥𝐝 𝐟𝐚𝐢𝐥

The goal of a transformational project isn't to launch a perfect product. It's to LEARN. 

When you run 10 transformational projects, you're not expected 10 successes. You're expecting:

👉 8 "failures" that generate critical market insights

👉 2 successes that deliver outsize returns and fund the next 10 bets.

But to make this work, you need to run Two Portfolios, Not One

Don't manage innovation with the same KPIs as your core business. You'll kill every good idea. Instead:

🎯 EXECUTE Portfolio: For core projects. Manage for predictability

🎯 EXPLORE Portfolio: For adjacent and transformational projects. Manage for learning. 

𝐌𝐚𝐧𝐚𝐠𝐢𝐧𝐠 𝐭𝐡𝐞 𝐈𝐧𝐧𝐨𝐯𝐚𝐭𝐢𝐨𝐧 (𝐄𝐱𝐩𝐥𝐨𝐫𝐞) 𝐏𝐨𝐫𝐭𝐟𝐨𝐥𝐢𝐨

🔎 𝐀𝐫𝐭𝐢𝐜𝐮𝐥𝐚𝐭𝐞: Define the strategic themes for innovation

🔎 𝐀𝐥𝐥𝐨𝐜𝐚𝐭𝐞: Dedicate a separate budget and talent pool for the Explore Portfolio

🔎 𝐀𝐥𝐢𝐠𝐧: Regularly review the portfolio to ensure it matches strategic goals

🔎 𝐀𝐧𝐚𝐥𝐲𝐬𝐞:Track learning velocity and kill rate, not just premature revenue forecast