Why aren’t companies amping up their innovation investments in 2016?

This past week, I spent time with a number of CFOs of American-based companies on the topic of innovation – and the overall mood was “we’re holding steady on spend and are cautious about growth.”

When you go to build your business case for bigger innovation budgets, it’s helpful to know the objections, in order:

Alphabet and Wall Street’s appetite for innovation

The secret about corporate jobs in innovation is that they are hard to hang on to.

Which one have you been:

a/ The Innovation Pod Leader

Are you in charge of an experimental innovation structure? The incubator that serves as the pet project of a senior exec? Do you have an office outpost in Silicon Valley, where you give tours to senior execs from headquarters?

Lean Startup is great for finding scale opportunities, quickly, You make assumptions, discover your customer needs, run some tests, and you can quickly get feedback that you’re either on the right track, or need to start again.

Yet one thing that tends to stop founders from even asking the right questions in the first place is the reason why they are starting a business.

Look away for one moment, while everyone is reporting from CES and predicting great technology advances for the internet-of-things-in-my-coffee, blockchain-based-bake-sales, and drone-powered-dog-walking.

I’d like to celebrate my personal bank for making huge advances yesterday.

Citibank, I’ve been a customer for over 20 years, since my first big girl paycheck. You are my local bank. My community bank. In an email to me yesterday, you announced a huge technology achievement.

I was talking to a 25-year-old founder of a med-tech-health-tech startup yesterday who was just calmly eating his lobster roll with no fear or trepidation regarding the coming Fed rate hike. I realized why – the last time The Fed raised interest rates he was only 15. No wonder he was not in a complete panic! He hasn’t witnessed how interest rates affect the startup food chain

Did you play Monopoly over the holiday weekend? The first time I played, I cornered the market on the fancy neighborhoods: Park Place and Boardwalk, that whole corner from Atlantic Avenue through Pennsylvania Avenue. I bought houses and hotels and saw the money come in, and my enemies (my friends and family) crushed, destroyed, and bankrupted.

Am I Non Profit or For Profit or Something In-between?

What kind of company is best for my idea?

About three years ago I started to get a new question from entrepreneurs: is my idea best suited to a nonprofit or a for profit or something in-between?

At first I found the question strange. It seemed so binary to me. When I was graduated from college, there were two basic career doors to open:

Are the business models we use constraining us from building the future we want?

Utilization
Organization
Optimization
Mechanization

The way we imagine and discuss new business models seems to be trapped back in the first Industrial Revolution. We talk about “creating machines,” “measuring throughput,” and “optimizing efficiency for zero defects.”

One of the first jobs in unlocking a business model is to define a customer segment, and figure out customer “pain points.” You know you’ve struck gold when you uncover a “hair on fire” problem that is so tremendously painful the customer will work with your earliest version of the product just to douse the flames.

The belief about pain points is reinforced by investors, incubators, accelerators, and entrepreneurship curricula like Lean LaunchPad.

Should social impact companies be held to a higher standard than good old fashioned profit seeking companies?

We were asked to start documenting social impact business models – starting with the “one for one” buy one, give one model promoted by TOMS shoes. Our first sketch of the one for one business model unearthed perhaps more harm then good.

What can we read into the counter trends in subscription models? In the nearest future, will can extrapolate and see everything we used to own being delivered, via drones, our door, while we consume all of the media we want for “free” in exchange for native advertising?

In the West Village, where I live, recycling night is a chance to learn about the latest trends in consumption. Each week there are less magazine and newspaper piles, but more subscription economy boxes.

The Promises and Perils of the Hollywood-Style Elevator Pitch

Hollywood wheeler-dealers are famous for pitching new movies to studios with a formula that combines two successful old movies. Robert Altman’s 1992 comedy The Player fictionalized pitchmen who proposed such fantastic ideas as “Out of Africa meets Pretty Woman” and “Ghost meets The Manchurian Candidate.”

Google has announced that it will become Alphabet, a conglomerate—that old-fangled complex corporate structure popular in the 1970s.

Could the conglomerate structure, as Google is defining Alphabet, represent the boldest and most innovative move yet within the entire class of super-tech companies?

Google is not the first company to confront the dominant-logic problem, which can cause successful companies to self-destruct, but it is doing so in a way that both challenges and appeals to Wall Street.

“Every moment I have with my kids I realize is something I can’t buy back. No matter how much money I make or how powerful I get, I can’t buy time.” – Ryan Carson, Founder and CEO, Treehouse

My enlightened yoga practicing mediating self has my thumbs way up. Think about the positive consequences – the children and friends of these people will be more connected. Their hearts and nervous systems and overall health will benefit from being disconnected from work for three full days per week. How enlightened.

When is the best time to begin thinking about your business model?

Now.

If you are wondering about how your business will generate revenue and profitability to grow, then start if you haven’t already. But first let’s clear up some myths that plague early stage founders and intrapreneurs when they start tinkering with a new idea: