How to Scale Innovation Capability

I've been having lots of conversations with leaders about scaling innovation capability. [Note: These days, innovation in many executives’ minds translates to: “How does AI fundamentally change how we create and capture value?”]

If you ask five leaders what “scaling innovation capability” inside the organization means to them, you might get five different answers, ranging from enabling team members with digital tools (aka AI), nurturing employee-led initiatives, or training people in design thinking. So, the first question when I work with leadership teams is to explore the seemingly innocuous one: “What does ‘scaling innovation capability’ mean and look like to you?” That way, we can surface different points of view and work toward alignment before jumping to execution.

For this article, I was curious to learn what research has to say about which levers have been proven to result in successfully scaled innovation capability. Here is what I found:

First, it’s no surprise that my seemingly simple question to leaders yields widely different responses because academia also offers a plethora of explanations. Researchers Antonio Moreira, Eurico Navaia, and Claudia Ribau concluded in their 2024 systematic literature review that “innovation capability remains a loose concept. Consequently, the dimensions used to assess ICs and their associated metrics are very plural, with consequences for what is truly meant and measured by ICs.” They go on to identify four models for how innovation capability can be defined. The one focused on organizational capability consists of the following dimensions (with no conclusive metrics offered to measure success):

  • Participatory leadership culture

  • Ideation and organization structures

  • Work climate and well-being

  • Development of know-how

  • Regeneration

  • External knowledge

  • Communication

Ok…

So, let’s look at how some companies have experimented with these levers in building innovation capability:

Participatory Leadership Culture

As part of their innovation transformation, pharma company Bayer streamlined their teams to run like start-ups by radically simplifying their management structure and enabling them to run with their ideas. They also re-defined the role of leaders into what Bayer calls VACCs: visionaries, architects, catalysts, and coaches, who enable rather than control employees.

Ideation and Organization Structure

Nestlé USA encourages their employees to imagine by asking “What if…?” Their New Business Ventures team partners with teams across the business to encourage What if... projects, lending their expertise on early-stage industry trends to test new products and business models that appeal to the evolving tastes of consumers. The company has already seen this approach helping them to reach consumers in new ways. They also launched Open Channel to give employees the resources to explore these ideas. Open Channel is a crowd-sourcing initiative that taps into our collective creativity – a platform that allows employees to submit big ideas or vote on ideas they like the most. To date, 9000 employees have submitted concepts, and the company has launched 23 innovative products.

Development of know-how

Multi-energy company Repsol realized 20 percent greater profit - specifically, €800 million in cash flow from operations—by launching 505 digital innovation initiatives and building shared resources that systematically helped over seventy-six percent of the initiatives scale their innovation and realize value from it. Rather than simply empowering initiative teams, Repsol executives designed a holistic approach coordinated across initiatives to scale innovations.

And here are some of my additional ideas based on how I’ve helped enable organizations to build innovation capabilities:

  • Embedding Design Thinking Mindsets & Competencies. Identifying organizational mindsets and individual competencies are a first step in building innovation capability.

  • Community-Based Learning & Peer Interaction. Communities of Practice (CoPs) drive behavior change and learning at scale.

  • Leadership Enablement & Coaching. Innovation capability building at scale must include leaders as role models.

  • HR.Hackathons & Experiential Learning. Intentionally designed experiences that drive innovative behavior change and accelerate cultural adoption.

  • Strategic Operating Models. Co-creating transformation roadmaps and governance structures are critical to scaling innovation reliably.

[Note: This article was originally published as part of the Design Thinking for HR LinkedIn Newsletter.]

ABOUT THE AUTHOR

Design Thinking for HR is a biweekly LinkedIn newsletter that aims to inspire HR professionals to experiment with the human-centered design framework. The newsletter is curated by Nicole Dessain, a talent management leader and founder of the human-centered transformation consultancy talent.imperative and the HR.Hackathon Alliance. Nicole is currently writing her first book about Design Thinking for HR. Join the Early Readers’ Community here.