Innovation Strategy & Implementation Flashcards

What is the main reason organizations establish a dedicated 'innovation accounting' system separate from traditional financial accounting?

Answer: To track learning milestones and validated assumptions before revenue exists

Innovation accounting uses early-stage metrics (validated assumptions, cohort data, leading indicators) to judge progress when traditional financial metrics are not yet meaningful.

A company pursues 'reverse innovation' by developing a product in an emerging market first, then selling it globally. What is the primary strategic rationale?

Answer: Leveraging resource constraints in emerging markets to create simpler, lower-cost solutions with global appeal

Reverse innovation (pioneered by GE Healthcare) uses the frugal constraints of emerging markets to develop solutions that are later sold in developed markets at disruptive price points.

Which organizational structure is most conducive to rapid innovation in a large enterprise?

Answer: Small, cross-functional, autonomous teams with end-to-end ownership

Small cross-functional teams with autonomy can iterate quickly, make decisions locally, and maintain end-to-end accountability, all of which accelerate innovation cycles.

What is the key difference between 'sustaining innovation' and 'disruptive innovation' as defined by Clayton Christensen?

Answer: Sustaining innovation improves products for existing customers; disruptive innovation initially targets overlooked segments

Sustaining innovations make better products for existing customers along established performance trajectories, while disruptive innovations start with simpler offerings for underserved or new markets.

When scaling an innovation from pilot to full deployment, which risk is most commonly underestimated?

Answer: Organizational change management and adoption resistance

Technical pilots often succeed while large-scale rollouts fail due to insufficient attention to user adoption, cultural resistance, and process integration challenges.

Which principle from the 'Lean Startup' methodology is most directly applicable to corporate innovation programs?

Answer: Build-Measure-Learn feedback loops to validate assumptions iteratively

The Build-Measure-Learn loop drives rapid, evidence-based iteration by building the smallest testable increment, measuring real outcomes, and learning to pivot or persevere.

What is the strategic purpose of 'time-boxing' in innovation sprint methodology?

Answer: Creating a fixed time constraint that forces prioritization, decisions, and momentum

Time-boxing imposes urgency that prevents perfectionism, forces teams to make clear trade-offs, and produces tangible outputs within a defined period.