Team Meeting In Creative Office

Shutting Down the Innovation Lab: Why It Is the Right Move

Sep 06 2016, by PEOPLE in Sales

The definition of innovation is combining creative ideas with business models for success. But for some companies, these innovation groups are often being shut down. Yet, in the world of business some people think it was due to the fact that the higher-ups ‘don’t understand the importance of innovation’ when in fact it’s the other way around. People today often think innovation is a fun idea when it has become a word only to be thrown around due to the way it sounds. But here are some facts behind the reason why bosses shut down these innovation labs.

Innovation labs are not really labs. It’s just a place to get creative ideas flowing. It could be that maybe one day you decide to look inside the innovation lab at your company and from there, you saw it was just people bringing out ideas and not testing them on business models that they have used or other companies have used. So you poke around for a couple of weeks and realize that these people don’t know what they are doing and therefore you decide to shut down the program. Even though they may be angry at you about it, what they didn’t do was put their ideas to the test. That is the sole importance of an innovation lab, to get ideas and to test their theory and see if it works.

Innovation labs sometimes don’t roll on the same ball with that of the company’s’ goals. Many of these labs often go outside the box, sometimes too outside the box. When you have an innovation lab at your company, it should be how you want the goals and values of the company should coincide with the ideas and projects going on inside the lab. The biggest problem is how a project should contribute to what the company wishes to do on a large scale platform. But due to projects being shifted around and left on the table to be placed aside, it’s no wonder that these labs often tend to shift their ideas outside of a company’s comfort zone.

Labs like these often have little focus. It’s like having children in a small controlled room. They have pens and pencils to think up ideas, but instead they often move onto other things before finishing up the idea that they just brainstormed. A strategic goal is where an idea must be aligned with the business model that the company wishes to follow to either meet their ends or expand their range of business services. Bad ideas are often the rotting apple in a barrel of apples that gets tossed in without anyone’s knowledge. Don’t ever think a bad idea is a good idea for a business success, it just makes a mess of things.

If you have ever been inside an innovation lab, it has games and looks like the inside of someone’s basement. Even though there is office supplies and ideas written all over the board, you still end up with a lot of people trying to get a high score on Call of Duty, then working on ideas for their business. These labs are often like study hall in public schools, there’s things to help you finish homework before you get home, there’s also distractions like headphones and technological resources that are used to find pictures of the inside of the phallic museum in Iceland. Maybe it is a good reason that you as the company founder shut these labs down because it is more theater than theory.

But the biggest importance behind the labs being shut down is revenue. Did they successfully made contributions to your profit, or was it a unnecessary expense in the wrong direction? Some companies who have shut down these labs often think the latter. Innovation labs can do a lot to help with activity metrics for any business such as: events they have hosted, press mentions, experiments they have run, the number of customer conversations, and the number of hackathons and minimum viable products launched. It means that although their impact was to help revenue, instead they acted like the substitute managers and secretaries of the business world, what a waste of talent and resources.

While innovation labs may be all the rage, there are some cases where they do work, but majority of the time it is a zone where no work is hardly ever done. If you feel like an innovation lab is great for your office, go for it, but if you want to be able to work on improving your revenue, then just a simple talent team and experienced business model experimenters should be left to the task. Otherwise, you just have an adult playroom with Twizzlers and pool.