Building a Radical Innovation Mechanism at Large Firms

Large firms are generally good at managing incremental innovations, yet they often lack the capabilities that are conducive to developing and deploying radical innovations (RI). Even though large firms recognise the importance of RI, most of them have failed to establish a mechanism, that is, a well defined organisational structure, management processes and resource allocation system that facilitates RI. Drawing on extant literature we build a research framework that explains the obstacles that large firms face with respect to developing radical innovations. We collect data among three large firms, namely Shell, Nokia and IBM, and identify the practices these firms have developed and established a radical innovation mechanism that allows them to circumvent the obstacles for tapping into RI. Following these practices we conclude with managerial implications for managers that are building a RI mechanism for their firms