Innovation has become the new buzzword in the world of financial services. Today, the quest for innovation has become increasingly important as adopting a culture of innovation is often identified with a trajectory of business growth, while failure to do so could lead to an organisation lagging behind. But how do long established companies ensure that they fully embrace innovation within every aspect of the organisation?

It has become commonplace to look towards start-ups for inspiration. After all, start-ups have delivered some of the most novel and transformative products and services, capable of disrupting entire industries from transportation to healthcare, retail and the media. However, simply replicating or mimicking the behaviours and practices of start-ups would be ill-advised. This approach, be it on a superficial level or as a radical overhaul, does not take into account the crucial facts that start-ups often fail, an outcome no large established organisation would ever wish for.

Instead of trying to simulate the behaviour of their newer, smaller and therefore more nimble counterparts, established companies need to broaden their perspectives and model themselves on the whole start-up ecosystem that is specifically constructed to thrive. Consisting of more than just start-ups alone, this ecosystem includes venture funds that provide the expertise, capital and governance; the universities producing skilled people and emerging technologies; and other organisations, both small and large, that are willing to invest, partner and collaborate. 

As such, it will prove more useful to invest in the systemic conditions for innovation to flourish rather than attempt to convert to start-up-style operations. This could mean fostering the financial processes that can help efficiently identify and fund good investment opportunities on a small scale. It could also mean having a productive and open attitude towards partnership and combining one’s unique capabilities or intellectual property with others to achieve greater goals, akin to BT’s Infinity Lab Programme. When an established business achieves this transformation, desirable start-up-like behaviours, such as being more agile, efficient and outward-focused, can eventually be developed.

Pouring maximum effort into emulating all elements of the start-up ecosystem will enable a company to nurture innovation opportunities without frantically chasing each new tech trend or new market. Above all, it will enable employees across the organisation to generate innovative solutions spontaneously. 

By all means you can provide football tables, free food, run hackathons, and create a stimulating, fun culture – treating your employees well and creating an inspiring workplace is simply the right thing to do. But this on its own is simply not enough; in order to galvanise an authentic transformation it is essential to emulate all the elements of the start-up ecosystem, and not just the most obvious perks.