Many organizations say they value innovation and then structure themselves to make it impossible. The budget sits in a separate line item. The work happens in a lab, an incubator, or a committee that meets monthly. Strategy, meanwhile, happens in the boardroom, where the scorecard tracks revenue, profit, and quality, and nothing else. The gap between those two rooms is where good ideas quietly go to die, and the cost shows up later as slowing growth, fading relevance, and competitors who pull ahead while the pilot program finishes its second round of testing. Dr. Cleamon Moorer, Jr., whose 25 years span automotive, healthcare, higher education, telecommunications, and nonprofit boards, has arrived at a blunt conclusion from watching that pattern repeat across sectors that otherwise have little in common: “Innovation only works when it’s built into enterprise strategy.”
Stop Treating Innovation As A Side Initiative
The structural error is easy to spot once named. “If it lives in a laboratory while strategy lives in the boardroom, you get experiments without impact,” Moorer says. That sentence describes a startling amount of corporate research and development. Organizations fund the activity, staff it with capable people, generate interesting results, and then fail to connect any of it to the decisions that allocate capital and set direction. The experiments are real. The impact never materializes, because nobody at the strategy table has a reason to care about them.
Moorer’s fix is realistic and therefore likely to work. Leaders should be clear about which problems innovation is solving and how much budget is allocated to those solutions. Then the goals go where the organization’s attention already lives. “Put innovation goals on your enterprise scorecard, right next to revenue, profit, and quality,” he says. That placement does more than symbolic work. A scorecard is the instrument through which boards interrogate performance and through which executives understand what they will be held to. An item on it gets reviewed, questioned, and resourced. An item outside it gets a polite mention at the annual retreat. Moving innovation onto the same page as the financials converts it from an aspiration into an obligation, which is the only form of priority that survives a difficult quarter.
Governance Should Enable Experiments, Not Block Them
The common assumption in regulated industries is that governance and innovation pull against each other, and that every compliance requirement subtracts from the space available to try new things. Moorer treats governance instead as the mechanism that makes experimentation possible at scale. The work is to get leadership and the board aligned around disciplined experimentation: agreeing in advance which risks are acceptable and manageable, what requires board sign-off, and how pilots get evaluated. Those three decisions, made upfront, remove the ambiguity that otherwise causes managers to either stall out waiting for permission or proceed without cover and get shut down later.
His healthcare experience supplies the sharpest version of the argument. “In healthcare, safety and compliance are non-negotiables, but we can still test new care models within clear boundaries,” Moorer says. The word doing the work there is boundaries. Clear limits are not a constraint on innovation; they are what allows a team to move quickly inside them without constantly relitigating whether they are allowed to. Executives who refuse to draw those lines believe they are preserving flexibility. What they are actually doing is pushing the risk decision down to people who lack the authority to make it.
Then comes the part most organizations skip. Moorer wants pilots reviewed every quarter, with a decision attached: scale, revise, or stop. Stop is the option that rarely gets exercised in practice. Projects accumulate sponsors, headcount, and sunk cost, and they persist long past the point where anyone believes in them. A standing quarterly decision point makes termination a routine outcome rather than an admission of failure, which in turn frees capital for the pilots that deserve it.
Culture And Measurement Are The Same Problem
Moorer’s third and fourth points look separate but solve the same thing. On culture, his reasoning is direct: “If people fear failure or making mistakes, the bold ideas never surface.” Note the sequence. Fear does not cause bad ideas to fail; it causes good ideas never to be spoken aloud. The loss is invisible, which is precisely why leaders underestimate it. His remedy is to celebrate lessons learned rather than only wins, and to write innovation into performance reviews and leadership development. The accountability mechanism he proposes is modest: ask every leader to improve one process, service, or product each year. One. It is a standard any competent manager can meet and no manager can quietly ignore.
Measurement is what keeps the culture honest. “Decide what success looks like before you start it,” Moorer says, and the ordering matters, because criteria set after the fact tend to flatter whatever happened. He calls for tracking outcomes, sharing them openly, and maintaining a simple dashboard of investments, pilots, and results. Simple is the operative word, since elaborate measurement frameworks tend to collapse under their own maintenance burden. Transparency is what closes the loop with culture: when people can see which experiments ran, what they cost, and what they produced, risk-taking stops looking reckless and starts looking like a normal part of how the organization operates. “When people see real results, momentum follows,” he says.
None of this is theoretical for boards weighing where to put their next dollar. Moorer frames the decision in terms that leave little room to defer it. “Change is going to come either way,” he says. “The real question is whether your organization is set up to lead the change.” Organizations that keep innovation in a separate room are not avoiding that change. They are simply arranging to experience it later, and on someone else’s terms.
Follow Dr. Cleamon Moorer, Jr. on LinkedIn for more insights on enterprise strategy, innovation governance, and organizational leadership.
