How to manage radical innovation

Most large companies are not radical innovators. They are good at making cl ose-in changes to existing products or technologies, but they cannot seem t o commercialize breakthrough ideas. This is the case because of their "gene tic" makeup: values embodied in their leadership practices, their cultures and structures, their reliance on internal R&D. and their inability to attr act and motivate the kind of aggressive and agile entrepreneurs who are the source of most radical innovations. Large companies in traditional industr ies that want to increase their access to radical innovation have a variety of approaches available to them. These range from ones that draw on existi ng organizational resources but are unlikely to stimulate radical innovatio n to ideas that involve a rethinking of external relationships with entrepr eneurs and venture capitalists. As the focus of innovation moves from what is inside to what is outside the organization. the keys to success move fro m mechanisms of owning and controlling the radical innovation to mechanisms that promote learning about its commercial potential.