Are Large Organizations Ignoring Innovation Acquisition?

Can companies in healthcare learn from Google's acquisition approach?


It’s common to hear people suggest that as soon as a company makes the transition to a larger structure that they’re bound by the same framework that stops their newfound counterparts from being innovative.

Although this remains true for many large companies, many lists that rank the world’s most innovative organisations put Xiaomi, Facebook and Google at the top of the pile, three companies who when combined generate nearly $100 billion in revenue.

This would seem to disprove the theory that only startups can genuinely be innovative, but the one thing that all the companies above have in common is that they are tech-companies, and for many, they are the only type of organisation that can truly be innovative regardless of the size they are operating at.

It was recently reported that if Google needed to cut their expenses they would turn to General Administration and Research and Development (R&D) to bear the brunt of the cutbacks. This would seem to fly in the face of the notion that Google are doing all they can to remain the world’s most innovative company.

Whilst R&D is a necessity at a company like Google, they understand that due to their size that they’re going to find it difficult to be as innovative as a startup which has little hierarchical demands. It’s because of this that companies like Google outsource their innovation projects.

It’s outside of tech where the problems start to arise for large organisations. Digital Expert, Matt Ballantine says on the topic of finance companies not looking at innovation acquisition, ‘Or take financial services. Where are the rumours of big banks acquiring nimble consumer app developers?’

Ballantine also points to healthcare, where he cites the lack of acquisition from health giants like GSK and Novartis into the wearable space as representative of larger companies unwillingness to look to startups for innovation.

With innovation important to large companies, sectors such as finance and healthcare should look to the tech giants such as Google as inspiration and proof that acquisition and the outsourcing of projects can work.


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