Building rocket ships to the future … from Spot the Dog to Daimler’s Lab1886 … the rise of innovation labs

February 15, 2022

Driving transformation is not easy as part of everyday business. Organisations therefore develop a range of alternative routes to creating more radical change, faster.

Spot is a dog-like robot that can climb stairs and run across rough terrains, has 360 vision, can carry  40kg loads, and endure – 20C. Handle is a robotic arm that can move boxes in a warehouse or guide surgical instruments within operations. Atlas is the world’s most dynamic humanoid robot, it can run and jump with 28 hydraulic joints.

Boston Dynamics began as a spin-off from MIT, where they developed the first robots that ran and moved like animals. The lab combines the principles of dynamic control and balance with sophisticated mechanical designs, cutting-edge electronics, and intelligent software to explore  how robotics can transform the worlds of healthcare to manufacturing.

The Chinese Academy of Sciences (CAS) in Beijing acts as the national scientific think tank that provides advice to Chinese businesses, large and small, and the government, specifically on using technologies to develop the economy and social improvement. It is the largest research organization in the world with over 60,000 researchers working in 114 institutes across China. Based on the total number of research papers published in Nature and its affiliate network, CAS ranked #1 among the world’s leading research organizations.

Silicon Valley’s PARC is an open Innovation company that has been at the heart of some of the most important technological breakthroughs. It brings together scientists, engineers, and designers focused on specific future themes. Creativity and science are core to PARC’s mission to reduce the time and risk of innovation. Teams assemble and grow organically, combining expertise and capabilities to work with start-ups and corporates.

Innovation Labs

Innovation labs have evolved from the Skunk Works which Lockheed Martin started decades ago. Moving from insular research and development roles of the past, like the secretive projects of Xerox PARC or Bell Labs, to a more open structure, with two roles:

  • Develop innovative concepts and business models without the distractions, demands and expectations, and internal obstacles of most organisations – to create significant new opportunities for existing business.
  • Develop new ventures, that require collaborative working and investments with external partners – be that other companies, new start-ups, and specialists – and may even lead to a new business.

An innovation lab is typically an open, collaborative space where people from different departments with outside partners, tech experts, designers, and academics, seeking to emulate the culture, speed, tech integration, and disruptiveness of a start-up, in order to develop new products, services, experiences and business models that take advantage of new business strategies and advances in technology.

Innovation Labs may be run in-house, or by independent companies, or venture capital funds who want to ensure that their investments are spent effectively. In-house labs run by corporates may want to bring start-ups into their fold providing resources or investment, with a motivation to learn from their specialist expertise, share in their entrepreneurial culture, or to have first option on the outcomes.

Incubators and accelerators

There are many different types of innovation labs – often known as incubators or accelerators. Incubators give birth to new start-ups and nurture their early stage development whilst accelerators enhance the ability the ability start-ups to scale-up into more significant business,  by adding more corporate structure, collaboration and more.

Of course many companies also develop innovation labs as vanity projects – colourful bean bags, lots of white boards, bikes hanging from the ceiling, a few robots sliding around, table football in the corner, you get the idea – but innovation labs can play an important role in driving more radical ideas, new cultures, and future growth.

The dedicated focus of an innovation lab has significant commercial benefits:

  • Faster development of new products and new business models that solve core customer needs and drive new revenue streams.
  • Protect against the threat of disruption from competitors, especially start-ups using new digital approaches.
  • Be a working lab to collaborate with customers to address specific challenges and develop more customised solutions.
  • Demonstrate products and capabilities to current and future customers, and business partners.

Whilst culturally, being separate from the main business has additional benefits:

  • Explore the potential of new technologies separately from current solutions, enabling more creative applications.
  • Build multiple innovation centres dedicated to important new categories, geographies and technologies.
  • Create a collaborative working space closer to industry innovators, and new technology centres
  • Shift the company culture towards greater innovation, technological integration, and collaboration internally and externally.

Inside Daimler’s Lab1886

The origins of today’s Mercedes Benz go back to Gottlieb Daimler who started out in a Stuttgart garage in 1886.Today, Daimler’s Lab1886 continues the tradition of innovation. It is a network-based initiative, where the German car maker explores new business models, through to new engine mechanics, fuel concepts and interior designs.

“Today, we are facing a lot of mega-trends like digitalisation and globalisation” says the lab’s director Susanne Hahn. “All these technological and social regulatory movements will change the automotive industry over the next 10 years significantly. We already have, within the Lab1886, a bunch of products ready for the future”.

The incubator works along the four pillars: connected, autonomous, shared and service and electric drive. The lab has locations USA, China and Germany, defining its goal as “to move faster from an idea to a product or business model”.

Employees can submit ideas based on any of the themes to the company’s internal crowdsourcing platform, with the best forwarded to the company’s “shark tank” panel of experts, and then to the incubation phase. Any of Daimler’s 300,000 employees can submit an ideas, and then work on it full-time in the lab if successful. Teams are also given coaching, co-working space, and funding to develop prototypes and pilots.

Projects are eventually either transferred into the appropriate line of business or spun off into new companies, where the employee could become the new CEO. Hahn says that the original ideator also has the potential to become the CEO of the new company.

Car2Go, a peer-to-peer car sharing platform, is one graduate of Lab1886, spun out as a separate company with 2.5 million customers. Other projects include a travel optimization app called Moovel, and external partnerships, such as a collaboration with start-up Volocopter, to explore the world of urban air taxis and vertical take-off vehicles.

(Excerpt from “Business Recoded” by Peter Fisk)

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