This text describes structural deficiencies in large companies that prevent many useful and beneficial innovations from getting realized. To solve this problem, the organizational concept of Innovation Empowerment is described in Section 7.

1 Introduction

Innovation is an important factor for the success of companies. Some large companies would like to be more innovative than they are. Although they are constantly trying to optimize their business models, once they have found them, groundbreaking improvements are difficult and rare to achieve. Even more laborious is the development of completely new and at the same time sustainable business models for the future. However, if existing business models are not improved enough and especially if old business models are phased out, the standstill or lack of new business models often results in the demise of a company.

The decisive factor for a company’s innovative strength is the staffing of the management level: In the early days of industrialization, company leaders were often also the inventors of their own business models. Today, there are many start-up companies whose founders are also trying to make new business models a success. If this succeeds with sometimes breathtaking results, then success today is once again based on a personal union of innovative personality and successful company management.

According to this observation, large companies should be able to systematically improve their innovative strength by making such innovators from their own ranks into managers, whose ideas and actions promise entrepreneurial success. However, this does not happen systematically, but only in rare exceptional cases. Instead, innovators almost inevitably must realize that the only way out for them to realize their ideas is to leave the large company.

The reason for this circumstance is explained below: It consists in the fact that entrepreneurial inventiveness is usually is not compatible with career advancement in a large company. To remedy this, Innovation Empowerment is a solution that systematically enables successful inventive work and makes it the central criterion for promotions to higher positions.

Innovation Empowerment enables large companies to identify, retain, and promote entrepreneurial inventors in their own ranks to ultimately turn them into business area managers and board members based on clear criteria. This can sustainably increase the innovative power of large companies, effectively produce groundbreaking improvements and viable new business models, and thus ensure the long-term survival of the company.

Innovation Empowerment can also be of interest to companies whose R&D process works so excellently that groundbreaking innovations and new business models are flawlessly achieved. Then in the current situation, the management level is filled with innovative minds. However, it is just as important to secure innovative young talent.

Annex A documents a comprehensive list of requirements that effective innovation management in large companies should meet. Innovation Empowerment fulfils all these requirements. Annex B identifies typical reservations about Innovation Empowerment and refutes them.

2 Usefulness of improvements

The starting point for any impactful innovation is an idea for improving what already exists. For people who have such improvements in mind in a large company, either as a source of ideas or as decision-makers, two fundamental questions arise:

1. Could the improvement benefit me?
2. Could the improvement benefit the company?

If you answer question (1) with only a “maybe” or a “no” and at the same time want to advance your own career in a targeted manner, you will usually not tackle the planned improvement. Innovations are always associated with risks and effort, whereby they must be actively represented and implemented, without personal benefit and success being certain. Conversely, it is primarily a group of people making a carrier who – if at all – only implement or support those improvements that appear to be less risky and benefit them within the area of responsibility assigned to them.

Let us therefore assume that question (1) could be answered with a clear “yes” concerning the proposed improvement. This is usually the case if the improvement relates to one’s own area of responsibility. For those who want to make a targeted career, the answer to the second question will of course always be “yes”. In fact, however, this second question remains subordinate as long as the improvement of one’s own career is beneficial and the lack of actual improvements for the company as a whole does not fall back on oneself.

Against this background, low-risk improvements that are conducive to the self-optimization of career opportunities and therefore usually primarily affect one’s own area of responsibility have the best prospects of actual implementation.

If one’s own area of responsibility is now increased by a successful career step as a reward for this self-optimization, then this does not change the basic attitude of the promoted person: Self-optimization takes priority over the optimization of the company.

As a result of this interest, the various sub-areas of a company optimize themselves in their respective areas of responsibility without systematically keeping the overall well-being of the company in mind. However, partial optimizations often do not lead to an optimization of the overall system. In addition, groundbreaking improvements and new business models are usually not based on optimization of subsystems but require an adaptation of the overall system.

The perception of the overall well-being of the company is especially the responsibility of the company management. Against the background of the above-mentioned considerations, however, in large companies it is primarily people who successfully act as self-interested self-optimizers who enter this circle. They are therefore often not at all predisposed or trained in terms of their way of thinking and career steps to put the long-term well-being of the company above their own benefit. This explains not only a low level of innovation and the lack of new, successful business models, but also many doomed attempts to establish unsustainable improvements or new business models because they have not been comprehensively thought through. This also explains the rejection of promising business models that could benefit the company as a whole, but not the own careers of responsible decision-makers.

Consequently, there are two demanding principles that must be followed so that large companies can either successfully produce innovations and new business models themselves or successfully acquire them through suitable acquisitions and survive in the long term with their help:

1. Only those improvements that demonstrably benefit a large company as a whole should be beneficial for the rise to higher responsibility in the company.
2. The successful implementation or acquisition of innovations should be seen as a mandatory prerequisite for appointments to higher and highest positions in the company.

How this can be made possible systematically is shown below.

3 Improvements to overall processes

Particularly useful and effective suggestions come about when an overall process is analyzed, its greatest weakness is recognized and targeted improvement is sought precisely there. A comparatively small improvement in this weak point can then have a particularly beneficial effect on the overall process.

A group of people who have the demanding ability to oversee overall processes in a large company as well as in the context of the market and to implement targeted solutions for their effective improvement will effortlessly free their own area of responsibility from such weak points.

In contrast, the area of responsibility where a weak point of the overall process can be identified is characterized by the fact that the group of people there is not able to oversee the overall process and to make the necessary improvements themselves. However, a person who comes up with an effective proposal for the improvement of an overall process usually has no authority to act in the area where he²⁾ has recognized the selective improvement as necessary. Without clear authority to act, however, no results useful for one’s own career can be achieved.

Structurally, this means that in the case of such suggestions for improvement, which could be of particular benefit to a large company, the personal benefit for the person who came up with the idea is usually more than uncertain.

The problem described above applies in a similar form to the development of new business models: These can only be successfully achieved if all the departments involved cooperate constructively. Mistaken doubters and self-serving brakemen work from their own areas of responsibility. Contradicting these parties is not beneficial for one’s personal career. If personal benefit, i.e. no trouble with doubters and brakemen, is more important than the overarching benefit for the company, then effective improvements to the overall process will fail, as will the introduction of new business models.

4 Proposals for non-own areas of responsibility

Large companies that have recognized the need for their own innovations regularly call on their employees to work for improvements in the company. This can lead to the assumption that a commitment to improvements, which are intended to benefit the company, would ultimately also be beneficial for the idea provider himself if the innovation is successful, even if such personal benefit is initially uncertain.

Energetic innovators who have an overview of overall processes and have already effectively optimized their own area of responsibility for a functioning overall process are also almost inevitably coming up with suggestions for adjacent areas of responsibility, because process weaknesses there have a negative impact on the result in their own area of responsibility.

Other areas of responsibility usually decide themselves on such suggestions from “external” employees by which they are affected and which they would have to implement in the event of a positive assessment. On the one hand, this inclusion is correct based on existing technical expertise, but on the other hand, it offers little chance of a positive assessment, as such proposals are often wrongly rejected for at least one of the following reasons:

• If the area of responsibility in question had been sufficiently qualified and the problem itself had been adequately recognized, then this problem would have been solved there long ago by its own efforts. However, weaknesses in content are usually accompanied by personnel weaknesses, so that such an effort on one’s own is omitted.
• In the other area of responsibility, the need for improvement may be recognized and affirmed, but there is a lack of competence, courage and willingness to take risks to develop something new as a remedy.
• The proposed improvement would require the use of professional resources that are not available in the other area of responsibility.
• Although the innovation would improve the overall process, the direct cost-benefit ratio for the area of responsibility to be changed may be low to negative, so that this does not seem acceptable from its own point of view.
• The potentially immense monetary benefits of innovation are so far in the future that the investment required will not be compatible with short-term profit expectations.
• The proposed improvement may have the potential to devalue what has been achieved so far in the area of responsibility referred to or, in the case of particularly effective innovations, to make this area of responsibility either partially or completely superfluous, which understandably does not meet with approval there.
• The development, implementation, and marketing of the innovation could tie up resources that might then be lacking to continue a current business.
• The proposal, which makes sense in principle, is only based on an external view of the problem, is therefore not yet fully developed and can therefore easily be rejected with seemingly well-founded but pretextual arguments.

If there is a rejection for the reasons mentioned above, then it seems obvious for the innovator to turn to higher authorities in the company in the hope of still receiving support for the implementation of the proposal.

However, superiors who are above the competent authority in the hierarchy will hardly contradict an already existing expert judgment, even if its substantive justification is intended to convey expertise, but at the same time contains completely untenable and erroneous arguments:

• The person addressed in management will consult the department of responsibility concerned and receive an almost identical negative opinion from there.
• A contrary instruction from management to this responsible department to implement the innovation anyway would not lead to the expectation that this would then happen there with the necessary commitment. Instead, it is more likely that it will be delayed, whereby the poor result could then in turn be blamed on the instructing management.
• The admission of a miscarriage of justice by one’s own specialist department could mean for the responsible supervisor that the staffing of the specialist department for which he himself is responsible is not suitable and therefore a new appointment may have to be made. The performance of this specialist department in the operational business may be satisfactory, while only the qualification for the evaluation and implementation of a demanding improvement is missing.
• The benefit of the change would not lie with this department or with the instructing supervisor, but primarily with the other department that made the proposal, and thus “only” with the company as a whole.

In the case of particularly serious misjudgments and a high urgency for improvement, it is conceivable that an innovator will now approach the upper management of the large company in the hope of a balanced assessment and appropriate support. However, a board member himself will hardly deal with the detailed questions raised and will also delegate the question back to the department responsible in the company, whereby all the above points will then apply again almost unchanged. An idea rejected in this way by a board member is then described as “burned”, i.e. no longer feasible in the company, because no potential supporter can now see an opportunity to improve one’s own career opportunities in it.

In addition, there is now the fear of the responsible authority and its previously involved superiors that their misjudgments might be exposed after all, and personnel consequences would be the result. The less plausible the rejection of a proposal was and the more vulnerable the now required statement to upper management, the more the area of responsibility concerned will now be indignant towards the person who came up with the idea. In such cases, it is also part of the repertoire to discredit the idea provider in such a way that he refrains from his project as much as possible.

For the innovator himself, on the other hand, the following picture emerges:

• Due to calls from the company to its employees to commit to improvement, the employee has done exactly what the company wants.
• The submission of an improvement for a third-party area of responsibility was done as an altruistic expression of a special loyalty to the company, because the benefit would lie primarily with the company with uncertain benefit for the person who came up with the idea itself.
• The greater the commitment to improvement and thus the greater the loyalty to the company, the more indignant parts of the company become, which can be perceived as a withdrawal of loyalty.

The withdrawal of loyalty in response to deeply loyal behavior must be perceived as so unfair that many energetic innovators end their previous loyalty and leave the company after such an experience, which is by no means accidental, but systematic. As a result of this “brain drain”, large companies lose the most committed, competent, loyal, and thus most important personnel for the development and implementation of groundbreaking improvements and new business models.

5 Prerequisites for improvements in non-own areas of responsibility

According to the explanations in the Section 4 it seems almost hopeless in large companies to implement proposals for non-own areas of responsibility themselves. However, since the effectiveness of such proposals can be very high, it is worthwhile considering a solution to this question. The implementation of improvements in non-own areas of responsibility can succeed in particular if two favorable circumstances come about:

1. A sponsor must be found who supports the implementation of such a proposal.
2. For the practical implementation of the proposal, the person who came up with the idea must himself change to the area of responsibility that was previously foreign to him.

It is irrelevant whether it is a minor change to a business process, a major innovation, or the development and implementation of a completely new business model.

Regarding point (1), it is important to find a person in upper management who, ideally, can derive a significant benefit from the improvement in his overarching area of responsibility. This person may not be responsible for the practical implementation of the improvement at first.

Such a person must be competent enough to see through the unfounded rejection of the specialist department and to correctly assess the feasibility of the proposal. This person must also have sufficient formal or informal influence to arrange the allocation of resources for the implementation of the proposal. After all, the reputation of this person must be so high that a deliberate deviation from the negative decisions of other bodies will be recognized by the company’s board of directors in case of doubt.

However, an effective implementation of the proposal can only occur if the person who came up with the idea himself in accordance with point (2) temporarily moves to where the professional implementation of the proposal is possible and necessary. The different phases of development, introduction, and marketing of innovation even result in different areas of activity, to which the innovator must then switch at the right time and work competently there.

The two requirements described above show that these are very demanding qualifications and activities, which at the same time represent particularly important entrepreneurial skills. The following quote confirms the high level of work for innovation:

“Naturally, and there should be no doubt about this, every company (…) should innovate (…); this should be one of the first priorities of every manager. (…) Carrying out management tasks is particularly difficult with regard to innovation and requires tremendous professionalism and experience. The best people are required for innovation, and even they cannot always handle it. (…) Managing innovation could be likened to the first ascent in mountaineering. The first ascent does not require different tasks or other tools from those used for the ascent of a known route. There are the same requirements but for a totally different level of performance.” (Malik, 2006)

6 The question of power in innovation

In market-based competition between companies, the question of power in innovation is more or less justly self-evident: The market decides. The more innovative company with the better business model can displace competitors with its superior product or service. The less innovative competitors either must catch up on their own, or they will go under.

Within a large company, on the other hand, the question of power in innovation is by no means fair and clear: The new can bring progress, but at the same time it also means a devaluation of the old. Since this promises inconvenience to the representatives of the old and they are worried that they could lose power and influence through the new, a power struggle between the new and the old inevitably ensues. In large companies, the representatives of the old are usually responsible for deciding on the new. So, it is not the market that decides here, but the position of power associated with the old and its self-interest. In addition, the new is not yet clearly visible in early decision-making phases but can only be described abstractly.

In this power struggle, promising progress in innovation is even dangerous; the successes already achieved and the benefits that can be presented for the company have a counterproductive effect: The better the new looks, the more consistently those representatives of the old, whose way of working or business model could be devalued, will want to bring about the end of the new.

A historical quote aptly describes this situation:

“And it should be considered that nothing is more difficult to handle, more doubtful of success, nor more dangerous to manage, than to put oneself at the head of introducing new orders. For the introducer has all those who benefit from the old orders as enemies, and he has lukewarm defenders in all those who might benefit from the new orders. This lukewarmness arises partly from fear of adversaries who have the laws on their side and partly from the incredulity of men, who do not truly believe in new things unless they come to have a firm experience of them. Consequently, whenever those who are enemies have opportunity to attack, they do so with partisan zeal, and the others defend lukewarmly so that one is in peril along with them.” (Machiavelli, 1513)

The range of means of power that can be used against the new is extensive in large companies. The most effective are to assign a different area of responsibility to the innovator or to change the hierarchical position of the sponsor. Such personnel decisions are easy to present, unless they require approval by the works council, seem inconspicuous in a context where many employees frequently change the projects they work on – and almost certainly bring about the premature end of innovation projects.

Accordingly, if a large company wants to create favorable conditions for improvements through committed employees, then the question of power, which is unavoidable in innovation, must be adequately considered. Conversely, this means that any innovation program in a large company that does not adequately take this question of power into account will hardly produce effective innovations from the circle of employees.

7 Innovation Empowerment as an innovation program

The Innovation Empowerment is an innovation program for large companies to effectively overcome the hurdles to improvement that almost inevitably result from their own size. This involves the implementation of proposals for which an idea provider initially has no mandate of his own, but which he himself is interested in implementing in an area of responsibility that was previously foreign to him. The basic principle for Innovation Empowerment has already been described in Section 5:

1. A sponsor must be found who supports the implementation of such a proposal.
2. For the practical implementation of the proposal, the person who came up with the idea must himself change to the area of responsibility that was previously foreign to him.

For the sponsor and for the innovator, these are very risky and highly entrepreneurial activities, the personal benefit of which for their own careers is initially extremely doubtful. Therefore, an adequate incentive system must be created that rewards the taking of these risks. Such an incentive system should include the two aspects of salary and position in the company and should therefore be designed as follows, for example:

• If the improvement leads to clearly measurable business success for the company, then the sponsor and the idea provider receive a monetary share in this business success. This profit-sharing should be based on a percentage of the actual company profit and should not have an upper limit on the absolute amount. This would allow multi-digit millions in dollars, which would result in earning opportunities like those for successful start-up entrepreneurs.
• A necessary prerequisite for appointments to the upper management levels of the company, i.e. the Executive Board,³⁾ business line managers and, if applicable, segment managers and site managers, is the entrepreneurial promotion and support of at least one demonstrably successful innovation project in accordance with Innovation Empowerment or a comparable innovative entrepreneurial achievement.
• If the improvement leads to clearly measurable business success for the company, then the innovator is offered adequate promotion. Ideally, he takes the lead in the commercialization of the improvement he has devised and implemented, if he is interested. Or the company fulfills the wish of the innovator, if any, to be allowed to bring further innovations to application maturity.

For the financing of Innovation Empowerment projects, the use of R&D budget and public funding should be permissible, as well as the provision of project budgets from the company’s operating business for entrepreneurial purposes. Financing agreements with external investors are also conceivable, whereby a profit-sharing of the investors should then be negotiated, but a repayment obligation in the event of failure should be excluded.

The search for a sponsor is very risky for idea providers, because the reactions described in Section 4 above can occur very easily. Therefore, the search for sponsors in the company must be “legalized”. For example, a local management committee could, in coordination with an idea provider, approach suitable managers to recruit them as sponsors.

The establishment of a connection between a sponsor and an idea provider should be documented and misuse should be prevented. Within the company, the connection between sponsor and innovator must also be protected against attacks by representatives of the old. A committee that is as independent as possible seems appropriate for these purposes. This leads to the following aspects for Innovation Empowerment:

• In the case of personnel decisions that directly affect the innovator, the sponsor must be granted a formally secured veto right, which he can exercise if the innovator so wishes.
• In the case of personnel decisions that directly affect the sponsor, the innovator should be granted a suspensive right of objection, which he can exercise if the sponsor so wishes.⁴⁾
• Such a veto or objection must be factually justified, and its actual effectiveness must then be confirmed by an appropriate and formally authorized body. In principle, the personnel decision does not take effect before a decision is made by the committee.
• An area of responsibility in which an innovation project of Innovation Empowerment is to be carried out must be able to call on the said body to explain its reservations. If these reservations are objectively justified, then the project can be stopped by the committee, provided that the sponsor has not already withdrawn due to these reservations.
• If an innovator or a sponsor should abuse the existing connection between them for personal gain, then every employee of the company is free to report this to the above-mentioned committee. After an examination, the committee can then issue adequate sanctions.
• It seems appropriate to assign the above-mentioned body, which is responsible for essential questions of Innovation Empowerment, directly to the CEO of the company from the moment the CEO himself has demonstrably fulfilled the criteria described above. Until that time, the body could come into being in the form of a temporarily formed committee of the Supervisory Board of the large company.

8 Advantages of Innovation Empowerment

The proceedings described in Section 7 “Innovation Empowerment” can prove to be very effective for innovations. It includes the following benefits, among others:

• • The main source of inspiration for an innovator is a grievance in need of improvement, which he himself observes and experiences to derive a proposal for improvement. This can lead to very practical innovations.
  • Particularly innovative and energetic employees act on their own initiative in those areas of the company that are least innovative and therefore have the greatest potential for effective improvements.
  • Implementing a self-invented proposal yourself is immensely motivating. Innovation Empowerment therefore implicitly implies that the people actively working for innovation are extremely motivated and committed. If, on the other hand, the development of innovations is dictated from higher levels of the hierarchy, then the question arises: Who does it? If a person appointed by the management is not committed enough to the innovation, this alone will lead to the delay or failure of the project.
  • The professional means and possibilities of a large company and its respective responsible departments can be used to their full extent.
  • The objectively justified reservations and recommendations of the respective competent authorities can be incorporated directly into the development work.
  • First, it’s about the idea, only then about the resources required for it. This is more efficient than the other way around, for example, when technological resources are made available in innovation hubs in the often-erroneous assumption that such equipment could actually be used for innovation projects and that alone would lead to more innovation.
  • Working for change in initially unfamiliar fields of work is actively practiced with Innovation Empowerment. Those who prove themselves in this process will later be able to competently take on management responsibility for an initially unknown business area. The use of managers to lead or restructure business units in which they have not previously worked themselves is common in many large companies.
  • Innovation Empowerment can replace almost all existing programs in a large company for the promotion of innovation and for suggestions for improvement.
  • Innovation Empowerment can also replace almost all programs for the personnel development of future managers. Instead of widespread coaching with confidential recommendations and non-transparent support, there is a performance-based, transparent funding program in which sponsors and idea providers work together in a binding manner based on an innovative factual question.
  • Innovation Empowerment can also replace all induction programs for so-called “high potentials”. Newly hired employees who are eligible as future managers based on the results of their education are no longer offered a formal and often unproductive induction program. Instead, they are expected to take on a task that seems interesting to them and to submit a proposal suitable for Innovation Empowerment very soon based on the resulting observations and experiences. The practical implementation from the initial concept through development and testing to commercial marketing or internal use with the necessary changes of departments and workplaces then leads by itself to an extremely interesting, productive, effective, and highly qualifying induction program. This is much more attractive and more sensible than, for example, going through three different positions in the first two years of employment according to a work plan, and only taking on partial tasks for a short time in each case.

9 Summary

Innovation Empowerment provides a solution that can fundamentally increase the innovative power of large companies. For the practical implementation of innovations, entrepreneurial idea generators and sponsors come together in a structured process. This constellation enables successful, inventive, and entrepreneurial innovation work.

The uncertain benefits and risks of demanding innovation work are rewarded with the incentive of appropriate profit-sharing. At the same time, successful innovations and their promotion are becoming the central criterion for promotion to higher positions in the company.

Innovation Empowerment solves the loyalty dilemma of energetic inventors who would otherwise leave large companies. To this end, it creates a balanced balance of the question of power, which inevitably arises between the old and the new in innovations.

A suitable committee is consulted for the evaluation of high profit-sharing schemes and for critical questions regarding Innovation Empowerment. This includes the confirmation of a veto or objection that funders or idea providers can lodge against such personnel decisions that directly affect their respective counterparts and would thus substantially jeopardize innovative work.

Innovation Empowerment enables a coherent and effective innovation process. It can also replace nearly all traditional programs for fostering innovation, leadership development, and all essential induction programs for highly skilled, newly hired employees.

Annex A: Requirements for innovation programs

For innovation programs in large companies to be successful and effective, many requirements should be met. These requirements are divided into subject areas in the table below and are described with corresponding questions. For the innovation program Innovation Empowerment, all these questions can be answered with a clear “yes”.

Subject area	Question
Idea generation	Does the innovation process enable a structured and systematic generation of innovative ideas?
	Is the ideation process closely linked to existing or future needs of external or internal customers?
	Does the innovation process promote the continuous generation of ideas without being tied to specific time breakpoints?
Topics of innovation	Is the same innovation process applicable to all kinds of different tasks, such as products and processes?
	Is it possible to cover projects from very small to very large sizes with the same innovation process?
	Does the innovation process enable the improvement of existing products and internal processes?
	Does the innovation process allow for disruptive ideas that may not be in the company's current focus?
Decision-making	Is the innovation process linked to an effective and transparent decision-making process?
	Does the decision-making process reconcile the views of the "conservative" leader and the "progressive" innovator?
	Does decision-making adequately consider the fact that those who prefer not to change are likely to choose not to innovate?
	Can the innovation – which does not yet exist – be considered in the company's overall strategic decisions?
Financing	Does the innovation process enable effective and fast financing of promising ideas?
	Does the innovation process enable sustainable financing that can span several financial years?
Management responsibilities	Does the innovation process put innovation at the center of management's attention and actions?
	Is the innovation process results-oriented and are these results consistently and effectively monitored?
Organizational design	Does the innovation process offer an effective and lean organizational set-up for the implementation of innovations?
	Does the innovation process allow for working as an interdisciplinary team if necessary?
	Does the innovation process encourage collaboration between idea generators and those who prefer to leave things as they are?
	Does the innovation process allow for external cooperation in the sense of "open innovation"?
Tools and Methods	Does the innovation process enable the use of suitable and professional tools and methods?
	Does the innovation process support and value modern working methods such as "agile developments"?
Time to market	Does the innovation process enable an effective transition from ideation to prototyping?
	Does the innovation process enable an effective transition from prototypes to marketing and sales?
	Does the innovation process as a whole avoid unnecessary idle time?
Sustainability	Does the innovation process provide incentives for participants to make innovation a success?
	Does the innovation process involve validation of results and long-term accountability of participants?
Excellent employees	Can all employees qualify for their participation in the innovation process?
	Does the innovation process enable substantial participation and empowerment of the innovator(s)?
	Does the innovation process promote and support the highest possible level of performance?
	Does the innovation process make the company an attractive employer for talented entrepreneurial innovators?
	Is the innovation process linked to the career development of employees?
	Does the innovation process allow the inclusion of newly hired talents who are in training or education?
Ownership culture	Does the innovation process encourage its participants to act entrepreneurially?
	Does the innovation process reward successful participants as if they were running their own business?
Uncertainties and risks	Does the innovation process encourage its participants to overcome uncertainties and take risks?
	Markets that do not exist cannot be analyzed. Does the innovation process enable a solution to this "innovator dilemma"?
Opposition	Is the innovation process forgiving in the sense that discarded ideas can be revived if their potential has been misjudged?
	Does the innovation process allow for challenging mainstream thinking and outdated management guidelines?
Threats to innovation	Does the innovation process offer an effective and fair solution to the "not invented here" syndrome?
	The new devalues the old, but the old has the power. Does the innovation process take this power problem into account and solve it constructively at the same time?
	Does the innovation process allow for surviving critical phases with serious mistakes and significant setbacks?
Protecting innovation	Does the innovation process formally protect its participants from internal threats?
	Does the innovation process protect against internal "theft" of promising ideas and successful innovations?
Credibility	Is the innovation process credible in the sense that innovations are actually implemented, and value is created for the company?

Annex B: Reservations about Innovation Empowerment

There are several reservations about Innovation Empowerment. In the following, some of them are formulated and each of them is refuted with an answer:

Caveat: Every corporate culture is different in large companies. Therefore, there can hardly be a universal innovation program that is suitable for the most diverse corporate cultures.

Answer: The innovation programs applied in a company contribute greatly to the respective corporate culture. Innovation Empowerment has the potential to change a corporate culture in such a way that groundbreaking improvements and new business models are produced much more efficiently and effectively than before. At the same time, details of the practical design of Innovation Empowerment can be adapted to the requirements of the respective company.

Caveat: Innovation Empowerment destabilizes a hierarchical organization because decisions can be made from the “sidelines” against the management responsible for a business unit.

Answer: A sponsor will get involved if the result of an innovation could benefit his own business. In this respect, potential sponsors in the hierarchy can be found primarily where the overall responsibility for the business area to be changed lies. Even if this is not the case, it is not about decisions concerning the operational business, but about innovation projects. Typically, these do not have the potential to destabilize the functioning of the operational business. In the case of completely nonsensical innovation projects, there is also a possibility of objection to their implementation.

Caveat: Decisions on innovation should be taken on committees so that different points of view are adequately considered. Innovation Empowerment, on the other hand, shifts such decisions to individuals.

Answer: In committees, groundbreaking new things are rarely decided, because the decisions should consider the interests and perspectives of all participants. In doing so, the representatives of the old on such committees usually pay very close attention to which “plants” would benefit the existing business models, and which new “plants” could endanger the old. Therefore, a small circle of people is better suited to decide on the fundamental question of whether to try a new approach. If the decision to test is made, then it is of course useful to consider the comments and views of a larger group of people. On the one hand, improvements for innovation can be derived from this, and on the other hand, aspects can also be identified that make a fundamental change in strategy or termination of the project seem sensible.

Caveat: The requirements for the innovation program are so high that there are very few potential idea providers and sponsors in the company who could competently participate in it.

Answer: It is precisely the problem of large companies that highly innovative employees are leaving. Innovation Empowerment offers an attractive opportunity to hire innovative and energetic employees and retain them in the long term, because they can work in the company as entrepreneurs.

Caveat: If a certain area of the company is closed to improvements, then management should draw on personnel consequences and replace the responsible people. Such a step is much clearer and simpler than sending and empowering idea generators.

Answer: Although personnel consequences may be appropriate, they usually come far too late for currently pending innovation projects. The threat that the rejection of improvements can have personnel consequences poisons the working atmosphere. In addition, some professional rejections are absolutely justified and must not have any adverse consequences. After all, many areas of responsibility are well enough positioned for the operational business, while there is only a lack of innovation. Sanctioning this would be neither appropriate nor expedient.

Caveat: An innovation department is much easier to represent for the implementation of innovations. From there, the necessary improvements for the respective businesses can then be developed.

Answer: A separate innovation department is necessarily not part of the operational business. Solutions developed there can therefore very easily miss the actual requirements. It is much more effective if the improvements are made where they will then be used directly in the operational business.

Caveat: With a functioning R&D process, groundbreaking innovations and new business models can be produced. Therefore, supplementary Innovation Empowerment is not necessary.

Answer: An R&D process can only work excellently if the company management is staffed with very innovative minds. That’s where the relevant specifications come from. In this case, the personnel issue is suitably solved in the current situation. However, Innovation Empowerment can still make sense because it trains young managers in a structured process in such a way that the management of the company can later be handed over to equally innovative minds. Innovation Empowerment projects should of course be included in the formal framework of an existing R&D process, if this is appropriate and possible in terms of content. However, Innovation Empowerment then includes several complementary or deviating aspects that can lead to significantly better results.

Caveat: It is much easier to place controversial innovation projects in start-up companies as spin-offs. If successful, the results can then be reintegrated into the large company if deemed appropriate.

Answer: Only a very small part of the potential improvements in business processes, products and services of large companies are suitable for spin-offs in start-up companies. Such start-ups first must build up themselves the infrastructure available in the large company. Although they can then act quickly and purposefully, they usually do not have the extensive resources and market access of a large company at their disposal. The “start-up” in a large company that is appropriately empowered with Innovation Empowerment therefore has many advantages.

Caveat: The proposed criteria for promotions to management positions may make sense, but they seem too slow, as one now must wait for the success of innovation projects.

Answer: During the initial period, the requirement could be made that all people in senior management positions must take on the role of sponsor for at least one meaningful innovation project. If this does not happen within a time frame of e.g. one year, or if there is no substantial progress after e.g. two years, then this management position will be filled differently after the unsuccessful expiry of one of these two deadlines.

References

↩ Machiavelli, N. (1513), The Prince, Italian original title: Il Principe, The University of Chicago Press (1998), Chicago, pp. 23-24

↩ Malik, F. (2006), Managing Performing Living – Effective Management for a New Era, Campus Verlag, Frankfurt/New York, pp. 238-239

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↩ 1) The author thanks five persons who are not named at this point for their very careful review of this text.

↩ 2) In this text, the masculine spelling also refers to the feminine spelling of a person’s designation.

↩ 3) Accordingly, the Supervisory Board should support Innovation Empowerment and consider the described requirement profile when appointing the members of the Executive Board.

↩ 4) If the sponsor leaves the company for reasons of age, either an adequate replacement person must be found or the sponsor should be given the opportunity to continue to accompany the innovation projects he supervises for the large company until they are completed, if this corresponds to his wishes.