The 70:20:10 innovation rule

The 70:20:10 innovation rule

A key tenet to being creative both for businesses and individuals is the desire and ability to take risks. People often ask if coming up with breakthrough ideas is about taking risks how can you operationalise that in a business without wasting money, upsetting shareholders and damaging your core brand? You may have heard of the 70:20:10 rule for innovation – originally the work of Lombardo and Eichinger for use in social planning, the ex-CEO of Google, Eric Schmidt introduced the 70:20:10 framework for innovation there. The idea is that time is spent:

  • 70% on core business
  • 20% core business- related projects
  • 10% on projects unrelated to core business

Schmidt said in 2005, of what has now commonly come to be known as 20% time “the test that I apply – and we do this every day, 70/20/10 – is to ask how a feature will extend the core, the adjacent, or the innovative stuff to fulfill our mission” (CNN, 2005).

You can apply the model to time and to budgets to mitigate the risks involved in trialling new ideas and ways of working. Think of the 70% as the business bread and butter – not to be messed with, it’s working and low risk. The 20% is middle risk and the 10% is high risk, possible high return in the future, but with the risk of failure too.

Coca Cola are also known for using this model to test out new areas and experiment with ideas as the image above shows, but with some boundaries in terms of the risk of the investment and the resource. There’s a great in-depth case study from Contagious Magazine about how Coke has reinvented its marketing strategy – so called Content 2020 here. Why does all this matter? It’s summed up for me in this great quote: “We are moving from marketing communism – in which marketers were able to push average quality marketing to consumers –to marketing Darwinism, in which people will only see what they want to see.” Javier Sánchez Lamelas

So next time you’re planning a pitch or campaign, or you’re developing ideas for your own brand, perhaps think about how you could play around with your time and budgets using the above methodology.


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