We are in a fascinating fast-moving period, with high speed technology diffusion, low interest on financing, globalisation, digitalization and automatisation. The future of many established companies is now jeopardized and will depend on their ability to get up to speed and innovate in this Creativity Era we are in (and that I described in my last article).
Some new players appeared and manage to create value and growth through innovation: Born Global Tech Driven Startups operate and disrupt in a way we have never seen before. Let’s have a look at this dynamic movement, what these successful startups do and what can be used in old organisations to revitalise. In this article, I am sharing with you some thoughts about what established businesses, BIG or SMALL, can learn from startups in order to accelerate innovation and adopt new behaviours in line with today’s world!
- CELEBRATE RISK-TAKING & INNOVATION!
One the main factors for failure, from my point of view, is that people are too scared of taking any risks. Well, risk is good, and this is where you find the greatest potential rewards.
It may be hard for employees in established companies to be the source of disruption and to to take unsafe paths as their own job is in danger in case of failure. For startups, it is a prerequisite if they want to grow and are brave is how they become disruptive and coming up with great ideas, and eventually compete with much bigger players!
While startups constantly experiment and try new things, the management team and employees of other firms are bridled by corporate world, pressure, threats of losing their job… Change it all through new KPIs defined and strong communication, creating a new mindset as well as minimizing the risks for coworkers to lose their job. You may get surprised by the ideas emerging from every layer of the organization! You can also start by finding your internal champions, the intrapreneurs who are just waiting for a call from the leadership to get to work!
To promote innovation, a company must therefore create a favorable environment that empowers people to take risks, creating a comfort zone where there will be the chance to fail, the support and trust needed, but most importantly the chance to innovate and eventually succeed. In the worst case it will end up being a learning experience for the entire organization… or a big sales boost, a new feature, a game changer, a Blue Ocean?
- DISRUPT (BUT DO IT OFF THE CORE!)
Entrepreneurs are capable of greater innovations than key historical players in some industries (a great example would be Tesla disrupting the car industry) not because people in startups are necessarily smarter than the others (are they?!). They create disruption by taking new approaches, rethinking and challenging what is being done.
You must create space to incubate new ideas, but do it off the core business so you don’t end up making a choice between innovation and other projects. We tend to like status quo and prefer to continue doing relatively good, denying the need for change.
To quote one of my colleagues, Agnes Sävenstedt, “When we help a company to become more innovative we try to make sure that disruptive innovations are developed away from the core development process”. Decision is otherwise to choose a safer path, with measurable ROI, thus renouncing to true innovation.
- BE QUICK!
Entrepreneurs have a strong appetite for speed as it is a race to have a product or service finding its place on the market but also in order to reach profitability and growth.
Their size is therefore a good advantage as it may mean less process, less decision-makers and approvals required, better communication between all people and departments enabling cross-functional collaboration and bottom-up support in order to facilitate these processes.
I am not suggesting to lay off employees in order to reach this status, but rather to set up new (possibly lighter) processes that will make the cycles faster and will allow you to bring prototypes to the market in shorter timespan and for a smaller cost.
This also allows to measure the potential success and response of the future clients. For other decisions of the company, applying the same method can be relevant: investing smaller amounts and quantifying the potential results before making larger investments, and limit the over analysis. It is about gaining speed to get to the market faster and it impacts every aspect of the business.
- COoperate, COcreate, COwork, Co…
Traditional models of corporate innovation are no longer the unique solution nor the recommended one for many companies. This old model of R&D department may not be working as it is too costly for many firms to be fully operating on their own, while an open innovation approach may be a better approach.
To stimulate innovation and to create new opportunities, and especially for small structures, a firm can connect with its ecosystem; in other words, connect with its clients, suppliers, partners, with researchers, authorities, influencers, field experts, the crowd. Open Innovation’s unique potential resides in the capacity to involve external human resources, experts on various subjects, an audience with another point of view.
Not having the same resources as other established companies, and being more open and looking for a way to collaborate with other startups and to become part of a community, interact with potential mentors and investors, startups are often pushed to work in a different configuration such as co-working spaces. This is a physical aspect of this open model
Make your ecosystem (in a broad view) communicate, collaborate, co-create. By involving your environment in your projects, you may think of problems from different perspectives, and get extremely valuable input in your projects. Engage your customers and business partners in your initiatives!
If this is not enough, and actually, even if it is, I suggest that you think of collaborative innovation with startups too. Companies should embrace new organizational models and strategies in line with today’s reality. Here is one:
- Established companies have experience and robust expertise, more stability and resources than startups (unless the startup closed a X round of investment!), are trusted by clients following many years of relationship, a purchasing scale….
- Startups have this tremendous capacity to be creative and innovative, making the best out of new technologies, are digital champions and are more open to new business models, markets and opportunities! They think out of the box, but for real, come with a fresh eye and exciting spirit.
Why not combining both? Co-innovate, open doors to startups! It could be your office, production facilities, network, or else but give them access to what makes you stronger. In my opinion, it could be a fruitful partnership as both have a lot to gain and to learn, and could be a great source of competitiveness and growth.
It could imply sacrifices regarding secrecy of the strategy as well as the need for a new management system, intellectual property configuration and protection. But the opportunities it may create are worth it! You must establish a business case and evaluate the potential gains and opportunities of such a relationship for both parties. It may also be a challenge in the sense that you must be ready to embrace a new work culture, potential generational gaps too, but only for the best! I would be really keen on getting your reaction on this specific aspect so just feel free to comment this post or get in touch directly with me!
- BECOME A DIGITAL CHAMPION
Another aspect that makes these startups successful is their ability to use social media and the digital world. They fully embrace these aspects to engage with customers, to do targeted marketing, bringing superior results than traditional marketing approaches and techniques… Design and user-friendliness is totally integrated in their online strategy, through a strong identity, high activity and appealing websites.
- MAKE EVERY TEAM MEMBER COUNT
Startups are seducing great talents because they offer great work conditions, value every new team member, giving the possibility of having an impact and working on making the world a better place, offer high level of responsibility as by nature, being in a smaller team requires multi-tasking from every individual and least but not last, startups may offer a lot more opportunities for personal and professional growth.
This great reputation allows them to be highly selective, and to hire highly motivated top-tier talents that make the whole team better. Everybody is hands-on and driven by a common strategy and passion, A natural selection is made as everyone knows before joining a startup what it takes and how much work and personal involvement it represents; how stressful it can be even though it may be a lot of fun too!
Startups are also more flexible regarding working hours and open to work from remote location. This can be a great source of energy and efficiency for the team, and a great sign of trust.
Create such teams, value and give responsibility to your people to engage your employee in your new projects. A key element for engaged workforce is a clear vision and strategy that drives the organisation in the same direction and units them.
- BE OPEN TO NEW MARKETS & IDEAS
Startups often take new angles to solve existing problems or in order to differentiate from the competition, which may be composed of much bigger players. They are more open to change and new ideas, be it regarding the business model or distribution channels. The idea is to think in a different way than what is already being done on the market. Startups are free to think and to take totally new ways as they may not report to another organisation. These Born Global Tech Driven Startups will find growth and scalability in and out of their home market.
The larger a company is, the more focused on large markets it is… an endless circle making everyone focused on clearly defined paths and markets, and is one reason why large corporations fail to innovate. Startups don’t! Entrepreneurs may focus on solving one specific problem, looking at unexplored niche markets, which allows them to create a strong value proposition, and to differentiate themselves from other players.
You may not be able to replicate the exact same environment as the successful startups, but I hope that this helped you and inspired you to embrace this new world we are in. Please engage on social media, share your own experiences and prospective, and complement as I most probably have missed other elements!
All of these points may help you to develop your innovation capital, strengthening your capabilities. You can actually do a free innovation capabilities & strategy measurement via this link in order to set priorities: https://innovation360.com/innochannels.