HBR's 10 Must Reads on Innovation (with featured article “The Discipline of Innovation,” by Peter F. Drucker)

connections between innovators and mainstream operations, and cultivating communication and collaboration skills.

Established companies can avoid falling into the classic traps that stifle innovation by widening the search for new ideas, loosening overly tight controls and rigid structures, forging bette

Shelley Nandkeolyar, the first manager of Williams-Sonoma’s e-commerce group, was not the most knowledgeable about the technology, but he was a leader who could assemble the right team

Companies that cultivate leadership skills are more likely to net successful innovations.

After its first great idea flopped, Timberland’s Invention Factory learned to work closely with mainstream teams to meet their needs for immediate innovations, such as recreational shoes lined with SmartWool, and to seek game-changing breakthroughs. Turner Broadcasting’s new-products group mixes project types: stand-alone developments, enhancements for current channels, external partnerships, and venture capital investments. PNC Financial Services Group recently established a new-products group to oversee mainstream developments, such as pricing and product enhancements, as well as growth engines in new capabilities, such as technology-enabled services and back-office services for investment funds. The company’s sales of emerging products were up 21% in 2005, accounting for 46% of all sales.

tighten the human connections between those pursuing innovation efforts and others throughout the rest of the business.

Besides needing different funding models and development partnerships, the innovation process requires exemption from some corporate requirements; after all, there are numerous differences between established businesses and new ventures.

IBM is building such flexibility directly into its infrastructure. The company established a $100 million innovation fund to support the best ideas arising from its InnovationJam,

The BBC’s biggest hit comedy in decades, The Office, was an accident, made possible when a new recruit took the initiative to use money originally allocated for a BBC training film to make the pilot.

One way to encourage innovation to flourish outside the normal planning cycles is to reserve pools of special funds for unexpected opportunities. That way, promising ideas do not have to wait for the next budget cycle, and innovators do not have to beg for funds from mainstream managers who are measured on current revenues and profits