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Networking for Innovation

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Networking and questioning are critical traits for C-Level managers at our most successful, innovative companies. These and other characteristics are discussed in a new book by Jeff Dyer, Hal Gregersen, and Clay Christensen (the latter the father of the term "disruptive technology") The Innovator's DNA: Mastering the Five Skills of Disruptive Innovators. As they state:

Innovative companies are almost always led by innovative leaders....The bottom line: if you want innovation, you need creativity skills within the top management team of your company.

An excellent review of the book can be found in the latest Economist. The article lists the five characteristics of disruptive innovators: associating, questioning, observing, networking, and experimenting. Ultimately, it asks the question: Can innovation be learned?

The plain fact is that the VCs, universities, and many large corporations have not shown much ability over the past 10 years to create new technologies that generate appropriate returns on investment. You can, of course point to successes in social media (e.g., Facebook, Linkedin) or the new wave of companies (e.g., Zynga, Gilt, Rue La La, One Kings Lane) as examples of potentially significant VC returns. However, these companies are NOT why we support universities with billions of dollars in grants. Furthermore, these companies do not represent the innovations coveted by the DuPont's and GE's of the world.

Just about every large pharmaceutical company is trying to rediscover that spark for creating new drugs. The entire portable computer and mobile device industry is trying to be Apple: But, large pharma has misplaced its mojo and no one is Apple. Perhaps the embodiment of The Innovator's DNA is that Apple is now the avatar of Steve Jobs.

We bemoan the silos we have created in large corporations so we go out in the world seeking to expand our perspective, but then we just fall into the trap economists would call "path dependency," that is just another silo (e.g., where to do we look for innovation? Boston, Silicon Valley, San Diego). Networking for innovation is not meeting someone who knows three people you know, à la Facebook. It is befriending individuals outside your sphere and engaging them in a questioning exchange demonstrating your genuine curiosity; then applying that knowledge to your own enterprise.

Many corporations are trying to break out of their silos by creating their own VCs. Unilever is setting up a fund in India and considering China. Flush with cash, many corporations are expanding their networks by partnering with other VCs or going it alone. A recent Bloomberg article's botomline: With traditional VC investing at an eight-year low, corporations are stepping up their funding of smartphone apps, robotics, and more.

The Innovator's DNA notes:

Pepsi came up with a different twist. Pepsi Refresh invites people to submit ideas on how to "refresh" their communities, making them a better place to live. Each month, the Web site accepts a thousand ideas about arts and culture, health, education, and so on. Online voting produces winning ideas, with grants ranging from $5,000 to $250,000. In 2010 alone, PepsiCo allocated $1.3 million each month to Refresh projects based on over 45 million votes cast. Pepsi Refresh's Facebook numbers also topped 1 million by the end of 2010, and PepsiCo is now rolling out the program globally.

Great networkers for innovation are "connectors" with an uncanny ability to find "mavens" in diverse fields. Malcolm Gladwell, in his book The Tipping Point, describes a "connector" as a person with a special gift for bringing the world together. A "maven" is a gatherer of information and impressions, and so is often the first to pick up on new or emerging trends. Instead of trying to break silos, we need to identify those individuals who naturally know how to connect them.

Throughout The Innovator's DNA, the authors identify successful, innovative CEOs who have quirky interests and curiosity for information far afield of their professional training or corporate niche. They are renaissance individuals.

The ability to network for innovation and to question in a way that doesn't threaten but instead conveys a natural curiosity is rare. Ultimately, the answer to the question posed by The Economist (Can innovation be learned?) is YES, but only for those with the right personality. The Innovator's DNA is written with "tips" to help the reader up his game. The "tip" that is implied but never explicitly identified is that corporations need to expend more effort to identify those individuals in their organizations who are the great networkers for innovation. This, a trait not typically listed in their performance criteria.

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