For more than a decade, unprecedented amounts of cheap money have encouraged companies to outsource innovation through M&A. Too many CEOs have fallen into the comfort zone of strategizing with bankers and external advisors, scheming about which company to buy — and neglecting to build their internal capacity for innovation.
The Perils of Innovation by Acquisition
It’s an easy trap to fall into when money is cheap. But it’s rarely a good idea.
September 21, 2022
Summary.
When capital is cheap, companies overdo it on M&A. Too many CEOs have fallen into the comfort zone of strategizing with bankers and external advisors, neglecting to build their internal capacity for innovation. Avoiding this trap requires a wholesale reinvention of a company’s governance, the goal of which is an integrated, internal innovation strategy where top-down and bottom-up innovation support one another.