Bidiversity

According to a new Nielsen study, companies where bosses don’t get involved in the innovation process produce more and better ideas than companies where managers take a hands-on approach.  The report suggests that bosses who get involved too early in the process tend to shoot down crazy ideas that might eventually have evolved into useful innovations. In this article by Paul Sloane of BQF Innovation, the potentially detrimental role of management in the innovation process is investigated.

Billions of dollars are spent on developing and launching new consumer packaged goods (CPG) products each year, and some companies see tremendous success while others – don’t. Why? One secret appears to lie in the degree of senior management involvement in the creative process, according to a study by The Nielsen Company.

Nielsen’s research of the innovation processes at 30 large CPG companies operating in the U.S. reveals that companies with less senior management involvement in the new product development process generate 80 percent more new product revenue than those with heavy senior management involvement. Companies that employ this and other best innovation practices derive on average 650 percent more revenue from new products compared to companies that do not.

Nielsen’s research shows that simply being physically near corporate headquarters can stifle new idea generation. In fact, it turns out that having no Blue Sky innovation team at all is better than having a team on-site at corporate headquarters. The best place for your breakthrough innovators? Far, far away.

According to Nielsen, companies with an off-site Blue Sky innovation team report 5.7 percent of revenues coming from new products, compared to 4.8 percent from companies with no Blue Sky team at all.

Companies with Blue Sky teams on site report just 2.7 percent of revenues coming from new products.

“One of the keys to successful new product innovation is to manage new ideas lightly,” said Tom Agan, Nielsen MD. “While we don’t dispute senior management’s strengths and good intentions, they are often too quick to get involved in the creative process, especially when things are not going well, and their mere presence can stifle free-thinking and boundaryless ideas – which can doom the new product development process to failure.”

Read the rest of the article here.