When Innovation is a Side Project, It Never Changes the Core

You can't transform your organization from the sidelines. When innovation is treated as a separate initiative—assigned to a special team, off in a lab—it rarely impacts the heart of how your business runs. Real innovation must be integrated into the core systems, norms, and decision-making processes. Otherwise, it remains theater.

When Innovation is a Side Project, It Never Changes the Core

Most organizations know they need to innovate—but they don’t want to disrupt the way things actually run. So they build what seems like a compromise:

• A dedicated innovation team

• A lab for “moonshots”

• A skunkworks initiative with cool swag

It feels like progress. But in most cases, it's a segregation strategy, not a transformation strategy. And that distinction matters.

Because when innovation lives on the edge, the core of the organization stays exactly the same.

Innovation Labs: Safe Havens or Sandboxes?

Innovation labs can be useful—but only if their work actually changes how the broader organization behaves.

Here’s what typically happens:

1. The lab develops a new idea or product prototype.

2. The “core” business ignores it, slows it down, or reshapes it to fit legacy systems.

3. The idea dies—or worse, launches in such a watered-down form it doesn’t matter.

Why? Because the incentives, metrics, decision-making processes, and risk tolerance at the core weren’t designed to absorb real change. The lab did its job. The system rejected it.

This is not an execution problem. It’s a structure problem.

What the Core Must Own (Not Just the Lab)

If you want innovation to scale, it has to embed in the very heart of the business:

• Product development: Are core teams allowed to deviate from “what’s worked before”?

• Operations: Can new processes actually replace legacy ones?

• HR: Are people promoted for optimizing, or for experimenting?

• Finance: Are there budget mechanisms for unplanned opportunities or fast pivots?

These are the levers that make or break innovation. If they remain unchanged, no lab can save you.

Innovation Is Not a Department

This is the hard truth: Innovation isn’t a department. It’s a behavior.

And for it to work, that behavior has to be widespread:

• Teams need to ask better questions.

• Managers need to celebrate failure that taught something.

• Leaders need to remove blockers, not just sponsor initiatives.

Innovation isn’t something you do on top of your real job. It is your real job.

Until that mindset permeates the org, you’re just experimenting in a bubble.

From Theater to Core Capability

How do you move from innovation as theater to innovation as capability?

1. Surface and rewrite the norms.
   If people say “we can’t try that until we get approval from X,” challenge it. Every norm that limits innovation needs examination.

2. Change how decisions are made.
   Push decision rights lower in the org. Enable fast, small bets.

3. Integrate innovation metrics (see last post).
   Track learning, experimentation, iteration, and value delivered—not just efficiency.

4. Make innovation part of performance management.
   Evaluate teams not just on what they delivered, but on what they discovered.

If It Doesn’t Touch the Core, It Doesn’t Count

You don't need a cooler lab. You need a braver core.

Innovation should not be an accessory to the business—it should reshape the business. Otherwise, you’re just rearranging the furniture on the Titanic and calling it design thinking.

Question for Reflection:

Where in your organization is innovation happening at the edges—and what would it take to embed that mindset into the core of how you operate?