However, companies will always have to resolve the dilemma of balancing funding for existing projects that make the company successful in the short-term with the need to back new concepts which may turn out to be critical for the firm's future.
One classic mistake companies make is to focus their R&D energies on potential blockbuster products that bring with them premium prices and high margins. The way to tackle this particular problem is to invest in middle-and-low-range ideas as well as the big bets.
This can be seen as a pyramid shape with the bulk of investment going to the top. However, it also means some lower level ideas are given the chance to breathe. Sometimes good ideas do come from the bottom such as 3M's post-it notes.
Processes can sometimes strangle innovation. One way to relax some of these controls is to put money aside to fund unexpected opportunities. Companies should try to foster better communications between divisions. Better links between three units at Gillette (toothbrush, appliances and batteries) might have helped it get their first with the battery-powered toothbrush.
For innovation projects to survive, they will also need other people in other parts of the business to back it. Inter-personal and leadership skills are, therefore, essential.
Innovation: the classic traps
Rosabeth Moss Kanter
Harvard Business Review, November 2006