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Quick note before we start. I recently moved this newsletter to Beehiiv, so the look may feel a bit different.

From now on, each issue will unpack one psychological insight and three practical implications you can use in corporate innovation in under three minutes.

Today’s insight quietly kills many innovation efforts. Most leaders underestimate this until it is too late.

Let’s get into it.

🧠 The Generation Effect

When I was facilitating innovation workshops across many companies, I kept noticing the same pattern.

People love to create.

Ideas they came up with suddenly had much higher importance.

When we generate ideas and solutions ourselves, we remember them better, and we develop ownership.

We care more about what we helped create.

Good teachers know this. They don’t just stand in front of the class like a priest and give a lecture. They are more like the Riddler from Batman. They give you a puzzle. If you solve it yourself, you remember it.

That is the generation effect.

And it is not only relevant for teaching. It is highly practical for anyone who wants to drive change and foster innovation.

3 Proven Ways To Use The Generation Effect To Drive Innovation

1. Let Them Realise

Convincing people that innovation is important IN GENERAL is usually quite easy. But convincing business unit heads to shift real resources toward innovation, especially when these initiatives are unproven and returns are far in the future, often feels more like trying to convince a stubborn toddler to share their toys.

What helps most is involvement.

Typically, the head of a large business unit is not eager to sit on bean bags for a week during your creative innovation sprint. What is more realistic is to set up a focused meeting.

But not just any meeting.

This is what you should say and do in that conversation:

  • Start by acknowledging their reality:
    “Before we talk about innovation, what is most under pressure in your unit right now?”

  • Mirror their goals and pressures:
    “So your biggest concern is protecting margin while still finding growth. Did I get that right?”

  • Evoke their own change talk:
    “If nothing changes in the next three years, what happens to the unit?”

Notice what is happening here?

You are not pushing arguments. You are helping them realise the need for innovation themselves. That is where real ownership begins.

2. Let Them Build

Invite people to help generate the strategy and the innovation initiatives. Whenever possible, don’t just communicate the innovation strategy, involve them and let them build parts of it.

If understanding the importance of innovation is silver, then this is gold. Let them be creative and build innovation themselves under your guidance and direction.

If business units help develop ideas and set up new innovation projects, they will not just support them. They will fight for them and protect them when pressure rises.

Without this ownership, many innovation projects look good on slides but slowly lose momentum in reality when you face setbacks.

3. Let Them Diagnose

Innovation in companies can start in many ways. Sometimes it is the inspired CEO who comes back from a trade fair. Sometimes it is the sales guy seeing what the competition is offering, thinking, "Why don't we have that?”

Many of these starting points are, how can I say it politely? Weak.

Problem framing is usually a much stronger starting point, because you want to avoid solving the wrong problem. But it becomes far more powerful when you involve the people who will later execute the work.

Let them diagnose the situation.

When people are involved early, they think deeper and push harder later.
When they join only at execution, the work feels like a chore.

Framework of the week: The Growth Horizons Model

This ownership gap is one of the hidden reasons why many companies run dozens of innovation initiatives, yet they barely move the needle.

In my latest YouTube video, I unpack the hidden EBIT growth gap, including how to calculate it, and the simple prioritisation logic most leadership teams overlook when they try to grow profitably.

Quick check-in before you go.

Your vote helps me sharpen the next one. (You can also reply to this email with feedback.)

See you next week!

Cheers,

Felix “Reframe” Hofmann

Founder of the Psychology of Innovation

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