Innovation Labs: 10 Defining Features

A closer look at what characterizes an innovation lab can help practitioners, funders, and scholars better understand what labs’ potential and limits might be, as well as better assess the social impact that comes out of the them.

Innovation labs, with their aspirations to foster systemic change, have become a mainstay of the social innovation scene. Used by city administrations, NGOs, think tanks, and multinational corporations, labs are becoming an almost default framework for collaborative innovation. They have resonance in and across myriad fields: London’s pioneering Finance Innovation Lab, for example, aims to create a system of finance that benefits “people and planet”; the American eLab is searching for the future of the electricity sector; and the Danish MindLab helps the government co-create better social services and solutions. Hundreds of other, similar initiatives around the world are taking on a range of grand challenges (or, if you prefer, wicked problems) and driving collective social impact.

Yet for all their seeming popularity, labs face a basic problem that closely parallels the predicament of hub organizations: There is little clarity on their core features, and few shared definitions exist that would make sense amid their diverse themes and settings. Most advocates would probably agree that a typical innovation lab spans organizational, sectoral, and geographical boundaries, and strives to engage a wide range of stakeholders in problem-solving activities. But a more-nuanced and analytical approach is badly needed to help guide future lab leaders and participants, as well as to inspire funder trust in labs’ likely impacts.

Building on observations previously made in the SSIR and elsewhere, we contribute to the task of clarifying the logic of modern innovation labs by distilling 10 defining features. Our account is based on original, qualitative interviews with the founders and leaders of a dozen labs, as well as an analysis of the online self-descriptions of 30 labs around the world. We believe summing up the self-definitions of innovation labs in this way makes it easier to distinguish them from important precursors, such as Living Labs, which typically enable corporations to benefit from user innovation. And while these 10 characteristics are far from unique to innovation labs, their combination can help us understand labs as a distinctive phenomenon. Unpacking these dimensions can provide practitioners, funders, and scholars with a more-nuanced snapshot of what innovation labs are about, how to assess them, and what their limits might be.

1. Imposed but open-ended innovation themes

Innovation labs seek contributions from a variety of sources, but they impose a broad innovation topic or theme in a top-down manner. This is because they typically serve as the instruments of larger organizations or networks—including national innovation agencies such as Nesta in the UK or Sitra, a public fund aiming to “build a successful Finland for tomorrow” —that have their own particular innovation agendas. That said, labs intentionally leave room for the further specification of the focal proble. For example, Quartier Stuff used “shape your district” as a call to kick off its community innovation lab, and defined focus challenges with lab participants only after collecting more than 1,250 suggestions on how to co-create the district from local inhabitants, workers, and visitors.

2. Preoccupation with large innovation challenges

Labs aim to create breakthrough, out-of-the-box solutions to major challenges of the present and the future, “addressing problems too big for any one organization to solve on its own” (UI LABS), such as devising alternative business models (Finance Innovation Lab), or working toward solving large health, safety, and development problems (InSTEDD iLabs).

3. Expectation of breakthrough solutions

Innovation labs pursue disruptive innovations and are called to “imagine the impossible” (LIL). Rather than settling for incremental improvements, their mission is typically to deliver “breakthrough solutions” (inCompass) and create places “where today’s moonshots become tomorrow’s breakthroughs” (MaRS Solutions Lab).

4. Heterogeneous participants

Innovation labs engage a wide range of participants, cutting across the boundaries of industries, professions, and cultures; they bring together “an unusual bunch” (Laboratorio Para la Ciudad) of people that would otherwise not work together. Labs use phrases such as “a diverse community” (Finance Innovation Lab), “multidisciplinary dialogue, cross-sector partnerships” (InSTEDD iLabs), or “partnership with uncommon partners” (LIL) to describe their convenings, and expect this diversity to fuel collective creativity.

5. Targeted collaboration

While labs’ typically impose a problem focus, they draw on collaborative technologies and dynamics to generate solutions. iLabs, for example, claims that it is based on “cross-sector collaborations that bring people together,” and eLab “focuses on collaborative innovation.” This approach presumes that all participants, regardless of institutional power differences, should treat one another as equal partners.

6. Long-term perspectives

Innovation labs are often framed as vehicles for “discovering the future.” For instance, Quartier Stuff aims to “innovate … to ensure long-term social cohesion and high quality of life.” Such freedom from immediate results creates space for blue-sky thinking and activities such as horizon scanning, foresight scenarios, strategic planning, and emergent signal analysis (sLab).

7. Rich innovation toolbox

Innovation labs apply a wide range of methods and tools to stimulate creativity, guide discussions, moderate collaboration, as well as develop, prototype, and experiment solutions. Their self-proclaimed role is to “bring together the brains, methodology, and diverse tools for … innovation” (inCompass). Labs’ toolboxes include design thinking and open innovation (Quartier Stuff), randomized controlled trials (Nesta’s Innovation Growth Lab), crowdsourcing (Finance Innovation Lab), and human-centric design (inCompass)—often in combination.

8. Applied orientation

Labs intend to develop tangible solutions, not just ideas, and therefore seek to remain active throughout the whole innovation process, going beyond the ideation stage where possible. In their own words, labs are “application-oriented” (InnovationLab) and “dedicated to the development of real solutions” (Civic Innovation Lab).

9. Focus on experimentation

Labs like to stress that they “create space for experimentation through facilitated processes” (MaRS Solutions Lab). They encourage participants to “try things out on a small scale, take risks, prototype, test and accept failure as part of progress” (Quartier Stuff), re-inventing their own methods and approaches as they go along.

10. Systemic thinking

In the words of a Comms Lab co-founder, a lab is “a space … for people who represent a system and … who are influenced by a system to come together … and co-create.” Indeed, labs claim that they are “rethinking the system” (Finance Innovation Lab) or working to “transform entire industries” (UI LABS). It is impossible to conceive of today’s innovation labs separately from the discourse on systemic change.

In a recent academic working paper, we condense the above into this definition: An innovation lab is a semi-autonomous organization that engages diverse participants—on a long-term basis—in open collaboration for the purpose of creating, elaborating, and prototyping radical solutions to pre-identified systemic challenges.

We hope additional experience and research by practitioners, funders, and scholars will test and refine this definition so that we can better understand and assess the impact of future innovation lab projects.

Read more stories by Ioanna LykourentzouTuukka Toivonen & Lidia Gryszkiewicz.