Innovation is no longer the crown jewel of large companies that can afford to fund research and development departments. The pace of technological change, and its democratizing effects, require organizations of all sizes to continually innovate. Even if the product or service on offer is successful, companies must work to disrupt their own gains. If they don’t, those gains will be short-lived, says Roger Martin, former Dean of the Rotman School of Management at the University of Toronto.

How organizations successfully innovate is frequently the focus of Martin’s attention, and here he addresses the research and development initiatives that operate outside the boundaries of day-to-day company activity. Called “skunkworks,” these departments are factories of creativity and innovation that focus on exploring new possibilities, unburdened by the rigors of market requirements and efficiencies. Steve Jobs famously created a skunkworks to develop the Mac, and research and development departments are another manifestation of sequestered innovation, says Martin.

Ultimately what is needed is an innovative organization, not just an innovative department. Martin has seen many products emerge from skunkworks only to be killed by their parent organization for being pie-in-the-sky and untethered from larger organizational goals. How then does an organization become innovative such that it focuses on both innovating new ideas while exploiting current products? By listening to front-line employees, says Martin.

An organization’s sales force, or other point-of-contact employees, holds the key to innovating in a way that is responsive to customer behavior. They will have more familiarity with how a given product is actually used than a room of designers locked away in a skunkworks. The result is a win not just for hardworking frontline workers over pretentious design departments, but a win for the organization as a whole as it requires a reevaluation of what constitutes innovation: simultaneous exploration and exploitation.

Roger Martin’s most recent book is Getting Beyond Better: How Social Entrepreneurship Works.

Roger Martin: Design thinking in my view is the productive combination of analytical thinking and intuitive thinking that enables you to both exploit to the maximum what currently exists while exploring new things to invent the future so that you have both reliability, a consistent enough outcome that keeps you going and validity.  You're pursuing great things that are wonderful for users that enable you to invent the future not invented by somebody else and imposed on you.  So it's that combination, the middle ground between the extremes of pure analytical thinking and pure intuitive thinking.

A big topic in innovation is the skunk work. And it's a big topic because there's a question, and the great Clay Christiansen friend of mine, great scholar in some sense raised the profile of this question by asking the question when you're dealing with a disruptive technology you want to disrupt yourself in particular, can you do it in the main mainstream part of the organization or do you have to have it off in a skunkworks, by which is meant that this organization is outside the mainstream organization and in some sense protected from the main stream organization so they can work away and work away and come up with something?  And Steve Jobs famously created a skunk works to do the Apple Mac development.

It's an area where I'm not convinced.  I'm not as convinced as my friend Clay, although he might be right because he's super smart, I'm not as convinced that that is the optimal design.  Because I've seen too many cases where when it comes out of the skunkworks it gets killed.  So the purported functionality if you will of the skunkworks, which is protection, actually makes the need for protection greater.  So there's a feeling in the mainstream organization that those people over in the skunk works got to play by different rules, didn't have to have the same rigor that we would've had to and now they're taking their thing that came out of it and thinking that they can just give it over to us and we'll welcome it with open arms.  No, in fact we're going to hate it because it's the product of in some sense a privileged system.  We'd love to have that system but we can't it's only the skunk works.

If you really want to be an innovative company and make innovation sustainable and not just this incidental thing that happens every once in a while in a skunk works, you just got to train the whole organization to think both analytically and intuitively to both figure out how to be good at exploitation and exploration, set up your systems so that they don't stifle that and make the entire organization an organization about innovation.  That it's an organization that thinks about innovation while it's thinking about exploitation.

People think that innovation comes from R&D departments.  That's another way of hiving it off those R&D people innovate.  It shouldn't be.  The key people, a key source of innovation in and well functioning company should be the sales force.  The sales force are going to spend one way or another more time with the customers than anybody else. The people who are closest to the customer have got to be involved in innovation otherwise you're going to waste your time on innovations that seem cool for the producer but aren't awesomely needed by the user. Anybody can be innovative and if you hive off innovation and put it elsewhere I don't think it's great for the organization.