I still remember a conversation I had over Google Meet with the Chief Innovation Officer of a global food manufacturing firm. We were discussing many areas of innovation but the one that really caught my attention was why some innovation programs fizzle out despite having big budgets, dedicated teams, and all the ‘right’ frameworks in place. The leader I was speaking to said, “We did everything that most innovators do and followed our process. Design thinking, lean startup, cross-functional squads - you name it. But somehow, the momentum never stuck, and it’s true for many projects we launch.”
That quote stayed with me as he was a very experienced leader who led their corporate innovation approach, and still discovered issues in scaling.
But what he described isn’t rare. In fact, it’s pretty normal in many large organizations trying to build an effective corporate innovation approach. They are great at assembling all the moving parts such as labs, accelerators, open innovation initiatives and so on, but often forget that innovation isn’t just a series of projects, but cultural and a mindset... A muscle reflex even. And most importantly, it’s a system that has to be woven into the fabric of the business from leadership, not bolted on as a shiny accessory or an afterthought.
So let’s talk candidly about what makes an innovation strategy actually work in a corporate setting, and where most leaders unintentionally go wrong.
Firstly, what does ‘innovation theater’ actually mean?
Simply put, innovation theater can be any initiative undertaken with the promise of innovation, but that doesn’t create real business impact. The term was introduced by Steve Blank, and has gained traction lately due to the influx of lean startups, new technologies and the need for speed and ROI. However, with a lack of focus and a rushed approach, true innovation doesn’t happen and gets stuck in limbo or fails to make the desired impact.
Why innovation theater happens more than we admit
Here’s the hard truth: the presence of activity doesn’t equate to outcomes. A disconnected or superficial business innovation strategy leads to bursts of energy without enduring value. This recent infographic shows the blockers that innovation teams have to deal with.
And more often than not, the root of the problem lies in misalignment between corporate innovation approach and the core business strategy.
Let me explain a little further.
Many innovation teams are treated like a separate R&D department, tasked with exploring the future and expectations of discovering the next big thing, while the rest of the business focuses on optimizing the present. This clear divide creates a credibility gap. Business units don’t take innovation seriously because it’s not their current priority, and the innovation team struggles to gain traction where it matters.
What’s missing? Integration. Innovation leaders must become bridge-builders, embedding innovation into the operating rhythm of the company at the team level and not isolating it. Pilots only work when it’s in the hands of the users experiencing the challenge it solves.
From experiments to ecosystems: A better corporate innovation approach
So what does a modern, effective corporate innovation approach look like?
It’s about creating a system where experimentation is continuous, insights flow freely, and not about chasing the next big thing in isolation. Strategic bets are placed with intention and a well-thought-out process.
Here are four pillars that I’ve seen drive real transformation from speaking to innovation teams:
1. Focus on must-wins, rather than novelty or nice-to-haves
Too often, innovation teams chase ideas for their novelty rather than their strategic relevance. But impactful innovation is almost always born from a core business need. For example, how automotive companies had to evolve to meet electric vehicle demands.
This is where a well-defined business innovation strategy comes in. The most successful innovation leaders tie their efforts to clear growth areas where the company must win in the next 3–5 years. Whether it’s digital transformation, sustainability, or new customer segments, every experiment should ladder up to a larger ambition and vision.
If your innovation team can’t clearly articulate how their work supports corporate objectives, it’s time to reassess.
2. Build internal innovation capacity (don’t just outsource it)
Partnering with startups is great, so is acquiring external technologies that are the hottest thing on the planet. But these can’t replace the need to build innovation capability within your walls.
Training product managers, business unit leaders, and middle managers in innovation methods is non-negotiable. The companies that get this right democratize it.
When innovation becomes everyone’s job, not just the remit of a separate team, the culture begins to shift and the buy-in becomes incredible, giving you more chance of successfully scaling projects.
3. Balance the core and edge
The core challenge of innovation in established companies is managing the priorities between today and tomorrow. It’s tempting to focus solely on moonshots or disruptive ideas, but incremental innovation often drives significant value too as it focuses on something that is already integrated and working, but just improving it.
That’s why a modern corporate innovation approach must balance the ‘core’ (improving existing products and operations) with the ‘edge’ (exploring new business models and technologies). Think of it as a portfolio. Not every idea will be a game-changer, but collectively, they move the business forward.
You can think of this like a sales approach with ‘hunters’ and ‘farmers’. The business revenue will grow by upselling, cross-selling or switch-selling to existing customers, as well as bringing on entirely new customers. Get both right, and that’s when the rocket ship takes off!
4. Measure what matters (and kill what doesn’t)
In the corporate world, what gets measured gets managed. But innovation metrics are notoriously slippery.
Forget vanity metrics like the number of ideas submitted, workshops held or how many startups have been discovered. What matters is the impact on the business. That means setting clear KPIs around learning velocity, time-to-market, adoption rates, and ultimately, revenue or cost savings - something that leadership really care about.
And yes, it also means being brave enough to shut down projects that aren’t performing - fail fast where you can. A strong innovation strategy includes governance that enables fast learning and decisive action.
People are the driving force behind innovation
At the end of the day, innovation is about the people, rather than frameworks. Culture, incentives, psychological safety, and leadership buy-in all play a massive role in successful projects.
One of the biggest unlocks I’ve seen is when innovation leaders shift their role from project managers to change catalysts. That means spending less time guarding a pipeline of ideas, and more time empowering others to innovate. It means getting out of the lab and into the boardroom, the factory floor, and the customer’s world. Make those relationships matter!
The key takeaways
If you’re leading innovation in a corporate setting, your job is less about launching cool pilots (although that is the dream!), but more about reshaping how the organization thinks and behaves.
That’s not easy. But it’s necessary.
Because the companies that will lead the next decade aren’t just the ones with the best ideas, but the ones with the strongest systems for turning those ideas into reality. A modern corporate innovation approach is about strategy, structure, and culture working together, not just in theory, but in practice.
So take a moment to reflect: Is your business innovation strategy truly integrated? Or is it theater?
Give an honest reflection as the answer may define your company’s future.
