The article describes the steps Shell managers took to keep their innovation innovative after the original establishment of the GameChanger system, by setting up its ‘innovation coalition’ as a network in its own right, and by reorganising its portfolio of 85 projects into half-dozen ‘domains’. The authors offer evidence that designing and implementing its domain approach enhanced the productivity and symbiosis of Shell’s innovation efforts, and use ‘Actor Network Theory’ – a conceptual framework extensively used in science and technology studies – to explain how this success was achieved. Domains not only link strategy and technology; but also marry up ‘bottom-up’ and ‘top-down’ innovations and connect the shorter with the longer term. The article’s consideration of domains renders the notion of ANT analyses more accessible and relevant for long term strategy professionals, as well as making some of the specific lessons Shell derived from its experience more widely available for application elsewhere.
Game changing innovation
In the 1990s, before the dot-com bust, it was popular for large organizations to entertain the idea that their employees could become ‘intrapreneurs,’ and develop new ventures in the same way as dot-com entrepreneurs. Many organizations became far better at starting projects than at stopping them, thus suffering ‘innovation over-load’, so the challenge for managers was to retain this innovation drive while containing the risk of over-load.
GameChanger was set up in 1996 within Shell as a process for developing innovation projects based on new and emerging technology. It is a peer-managed, stage-gated, funnel process to convert ideas into projects and eventually (for successful projects) into ventures. The process represented a significant activity within Shell for the period studied: in the 9 years to end 2007, 2,150 innovation project ideas had been submitted to the GameChanger process: of these, 1,950 had been stopped somewhere in the gated funnel, and 200 had graduated as successes.
Shell innovation managers evolved GameChanger to reinvigorate the company’s innovation practices: preventing them from becoming stale while rendering them more effective, and connecting innovation to strategy. Two of these evolutions, the innovation coalition and Domains, are discussed further in the article.
Domains allow innovation to link the possible future socio-economic worlds explored by scenarios with the futures scientists and technologists envisage might be possible; while aligning both with Shell’s corporate strategy. They can be seen as ‘stepping stones’ that link different potential desired company futures to Shell as it exists today; revealing the areas Shell needs to explore and develop if it wants to move toward the strategic possibilities identified in a given scenario.
Domains are at the heart of Shell’s initiatives to relate innovation to strategy, linking two important strategic activities – scenario plan and GameChanger.
For example, the ‘bio-fuel’ domain could include an ethanol project (producing fuel for the future from non-edible plants and plant residues) and an algae agriculture project (where fuel would be derived from the algae grown and harvested specifically for the purpose). These projects, together with perhaps half a dozen similar initiatives from the domain, would give Shell the option to move to a future where fuels are ‘grown’ rather than ‘mined’.
The impact of Domains is two-fold: projects that would die later (and thus involved more expense) are now killed off earlier; and the adoption rate for those that ‘cross the valley of death’ to graduate into being Shell businesses has improved significantly.
The actor-network theory (ANT) is introduced in the article, and is used to explain how domains work to link innovation and strategy in Shell. ANT critically examines (i) the links joining and distinguishing actors, (ii) the relations among those links in terms of dyads and networks, and (iii) how actors and interactions have Janus-like characteristics, so that actors constitute networks, and networks constitute actors. In ANT everything is dual – an actor is both a ‘thing-with-identity’ (or role) and a ‘member-of-a-network’ so that ANT inevitably sees everyone and everything as being actors in networks or (in its terminology) as ‘actor-networks’.
Summary written by Kamran Lamb
Prof. Rafael Ramírez
The lead author
A Founding Partner of NormannPartners and a Professor at the Saïd Business School, University of Oxford. He spent three years as a full member of Shell’s scenarios team, working with the other two authors (executives within Shell’s strategy and innovation teams) finding novel ways to link scenarios and corporate strategy with GameChanger, Shell’s innovation management system.
Dr. Leo Roodhart
Senior Associate at NormannPartners. Previously head of Group GameChanger, Shell’s corporate strategic innovation program and Associate Fellow at Said Business School, University of Oxford, on strategic innovation and teach strategic innovation at the MBA program of the London Business School.