44. 5I Innovation Pipeline

Key Definitions

Innovation is the process of coming up with something new and introducing it into practice. In organizations innovation efforts can be directed at novel products, services, or value propositions, but also at new procedures, processes, or ways of working. More ambitiously, even the business model or the organizational design can be reworked.

Innovation is not a brief event, but a longer process, typically consisting of a number of stages. It is also seldom the work of just one person, but usually involves a variety of stakeholders. Given the multiple steps and people required, it is important to map out and effectively structure the innovation process.

Conceptual Model

The 5I Innovation Pipeline framework outlines the five generic stages that need to be organized to successfully innovate as organization. The framework suggests that numerous innovation ideas are generally needed at the start of the process to eventually finish with just one or a few launchable innovative ventures (be it a new product, process or even business). As such, the process can be pictured as a narrowing pipeline, through which the potential innovations need to flow, with various initiatives at various stages of development. Separating the sequential steps are stage gates at which the viability to move to the next step is measured and no-gos are filtered out. Lubricating the pipeline flow are supporting learning and political processes.

Key Elements

The five stages of the innovation pipeline are the following:

1. The first step is to generate a wide variety of ideas, which can be done in many ways, such as brainstorming, scouting for external leads, doing research, and envisioning the future. The general rule of thumb is that coming up with new ideas shouldn’t cost more than a few hours. Then the ideas need to be evaluated on their viability – are they attractive and realistic enough to justify the investment of additional days or weeks of work.
2. Invention. The second step is to convert the viable ideas into more tangible concepts. This process of using initial hunches to create potentially workable solutions is called invention and can involve deeper analysis, exploratory discussions, experimentation, and ongoing tinkering. Eventually each invented product, process or business model will also need to be evaluated on its viability – is it practically feasible. This is also called proof of concept.
3. Initiation. Passing to the third step means the organization is willing to invest weeks or months to turn the invention into a minimum viable product (MVP) – something just good enough to field test with potential users. This initiation phase might involve modelling or simulating the new product, process, or business model, and then ramping it up to a prototype, followed by something externally presentable, to pass the project viability test.
4. Incubation. Once the project (i.e., product, process, or business model) has proven to be technically viable, the next step is to incubate it further, to turn it into a commercially viable proposition that can be launched in practice. This stage usually involves doing market research, staging trials, gathering lead customer feedback, adapting the proposition and finetuning a business plan.
5. Introduction. If the proposition is commercially attractive enough it will pass to the fifth and final stage of the innovation pipeline. This introduction can be inside the organization, in the case of a process or way of working, or outside in the market, if it is a new product, service or business model. Either way, the focus is on selecting the right application area and gaining acceptance from the prospective users and/or buyers.

Note that the main innovation pipeline activities are flanked by two crucial facilitating activities:

1. Learning process. Innovating is a constant journey of questioning existing views and discovering new insights, which challenges the innovators, but other stakeholders as well.
2. Political process. Innovating also means change, which is risky and can upset existing power structures. So, innovators need to align interests and secure ongoing support.

Key Insights

• Innovation requires much more than invention. Invention is the process of coming up with something new, but it is only an innovation if the new product, process, or business model is introduced into practice. Invention is technical, innovation is also commercial.
• Innovation requires going through 5 stages. Innovation starts with many ideas being generated (ideation), which are then turned into potentially feasible solutions (invention). Some of these rough concepts are subsequently ramped up into minimum viable products (initiation) and then molded into commercially attractive propositions (incubation). The last step is to launch the new venture and ensure stakeholder acceptance (introduction).
• Innovation requires increasing investment & commitment. As potential innovations move through the pipeline stages, the required management commitment and investment in money, capacity and attention multiplies, so their number usually dwindles in step.
• Innovation requires ongoing learning & political support. Innovation challenges the status quo, by upsetting received wisdom, creating new risks, and undermining existing interests. Hence, innovators need to keep an eye on organizational learning and politics.
• Innovation requires a filled pipeline. As it takes quite long for innovations to pass through all five stages and only a few make it to the end, organization need to keep their pipelines filled. This framework can be used to visualize an organization’s innovation portfolio.