Forgetting how innovation happens

Organic and inorganic growth are both levers to innovation.

Both bare risks.

One with M&A is, that in times of readily available capital, corporations tend to engage excessively in mergers and acquisitions. Leaders may become complacent, relying heavily on external advisors and banking institutions for strategic decisions, often neglecting the development of internal innovation capabilities.

This is what I experienced once. I was asked by a CTO, why we need organic innovation? What for? Looking back, the M&A activities had only meager returns.

Escaping this predicament demands a complete overhaul of a company's governance structure. The objective is to establish a cohesive internal innovation strategy that harmonizes top-down and bottom-up innovation efforts, creating a mutually reinforcing dynamic.

This transformation is vital to ensure that a company remains innovative and adaptable, rather than relying solely on external financial opportunities.