Those of us who have worked for one know that innovation is easier in a startup. But does company growth always mean an end to that innovation?
There's a new term going around business circles. It's called corporate sclerosis. It means a hardening of corporate bureaucracy and a slower pace of work and resulting output. As long as we're using this unfortunate medical terminology, I guess I'll chime in and say that the first casualty of this condition is the ability to innovate. You can try, but the processes and procedures necessary to run a large company can hinder the very act of innovation.
For those of us who have worked for a startup, this is fairly frustrating. In a startup, where the entrepreneurial spirit is high, employee ideas are not only appreciated but they can be carried out fairly efficiently. In larger companies, it can be harder to get things out the door.
Is corporate sclerosis unavoidable? Even companies that thrive on innovation, like Google, have been losing employees to more "flexible" companies, like Facebook, that are still very innovative. (According to résumés posted on LinkedIn, 142 of Facebook's 1,700 employees came from Google.)
Even Google's 20 percent time (letting employees work on their own projects) is losing some of its punch. According to a New York Times piece, Google engineers say they've been encouraged to build fewer new products and focus on building improvements to existing ones, like the terrain layer on Google Maps. And that makes sense. Innovation is great but at some point you have to have the personnel there to make sure the innovations happen and to keep them running smoothly.
So the question is, can innovation exist in large companies? Or is there inevitably a point where a company outgrows its flexibility?