Bottom-Up Innovation Readiness Lab
Build innovation capability by engaging teams in emerging technologies
- Difficulty
- Advanced
- Time to result
- ~months to results
- Steps
- 6
- Confidence
- 92%
This model treats innovation as an organizational muscle rather than an executive announcement. A small cross-functional group identifies technologies that are materially changing the market, then uses concrete topics and experiments to involve employees from the bottom up. Research, education, operating prototypes, and selective venture investments become mechanisms for accelerating institutional learning. The immediate output is not necessarily a finished product; it is a workforce that understands emerging technologies, recognizes their relevance, and leans forward rather than resisting change. Over time, useful experiments can alter the operating stack, improve scalability, and free specialists to focus on their highest-value work. The lab succeeds when innovation becomes distributed capability rather than the responsibility of an isolated team.
Origin
Ashish Shah described founding AB Labs at AllianceBernstein in 2015 with colleagues who believed fintech was materially accelerating change in asset management.
Core principles
- 01Innovation readiness is a practiced organizational capability
- 02Bottom-up engagement complements executive sponsorship
- 03Emerging topics create practical learning opportunities
- 04Education should precede large-scale adoption
- 05Experiments can generate both operational changes and investments
How to run it
- 1
Detect material change
Identify emerging technologies or market structures that could alter how the organization creates and delivers value.
Pro tip Prioritize changes with plausible effects on customers, workflows, or economics.
Watch out Do not build the program around novelty alone.
- 2
Form a cross-functional nucleus
Bring together leaders and practitioners from business, technology, operations, and investment or product teams.
Pro tip Choose members who can translate between specialist domains.
Watch out A team drawn from one function may struggle to influence the wider organization.
- 3
Create bottom-up engagement
Give employees structured ways to investigate, discuss, and test the selected technologies.
Pro tip Use specific topics and real use cases to make participation concrete.
Watch out A top-down mandate without participation rarely builds lasting capability.
- 4
Educate through exploration
Research emerging topics and share findings rapidly across the organization so teams can understand opportunities and risks.
Pro tip Translate technical developments into implications for each business unit.
Watch out Avoid research that remains confined to the lab.
- 5
Convert learning into action
Promote useful findings into operating improvements, products, partnerships, or selective investments.
Pro tip Judge experiments partly by what the organization learns, not only immediate revenue.
Watch out Do not force every exploration into a commercial launch.
- 6
Measure readiness
Assess whether teams identify opportunities earlier, collaborate across functions, and adopt useful tools more effectively.
Pro tip Track behavioral and operating changes in addition to project counts.
Watch out Counting ideas without measuring adoption can create innovation theater.
In the wild
A financial institution forms a cross-functional lab to examine blockchain. Teams map potential effects on settlement, custody, products, and compliance, then share findings with portfolio managers and operating teams. A small number of viable applications advance to pilots while the investment team gains a stronger basis for evaluating related ventures.
→ The institution becomes informed and prepared without prematurely betting the organization on an immature technology.
Common mistakes
Announcing innovation from the top
Executive sponsorship matters, but an initiative that never engages practitioners does not build organization-wide capability.
Confusing a lab with a venture fund
Investments may emerge, but the primary purpose is readiness, education, and operating adaptation.
Isolating what the lab learns
Research that is not translated and distributed cannot change the organization's behavior or operating stack.
Is it for you?
Best for
It is best for mature organizations facing technological disruption but lacking broad internal readiness to experiment.
Not ideal for
It is not ideal for organizations seeking only a conventional research report or a standalone venture fund.
From the transcript
“that we needed to build that muscle, not just set the top down as an initiative, but actually at as a bottom up engagement tool…”
“and so we tackled topics like robo advisors, crypto blockchain within that construct as a way to educate the organization much more rapidly and get…”
“most of that effort was a really around building organizational readiness to innovate.”
From the episode
Goldman Sachs Ashish Shah on Reading the Market With AI and Technology
Ashish Shah