Can Corporates innovate like a Startup?

In the startup world, the application of lean startup, puts the emphasis on ‘build, measure, learn, iterate’, and this approach is commonly used as a justification to start building on ‘unvalidated hypotheses’. When startups start with ‘build’, they start with what they already know, and strive to refine it from a narrow set of opportunities, that are not usually thought through and/ or validated by the end-customer.

A Corporate however, has specific constraints in comparison with a startup, to take into consideration as it strives to re-invent its innovation processes, since the company already serves a mass market, has a reputable brand, operates in a constrained legal & regulatory environment and of course controls an ‘unfair advantage’ of resources that can be put to specific use. This nature of a Corporate, comes with a downside that makes decision making slow and increases risk aversion. In reality, even though Corporates have lots to learn from startups it proves that the lean startup wasn’t designed to be used in a corporate environment, since it is an expensive and risky approach for them to implement within their existing constraints.

The way the startup ecosystem is innovating has made it very difficult to design a corporate-startup collaboration optimized for success. Corporates however, envy the agility of the startup world and together with the realization that traditional internally build innovation may not enough they aim to create an ‘interface layer‘ to better interact with the external environment, and easily introduce this externally created innovation to their internal universe, in a more controllable and easy to digest manner.

This new interface layer is being built through a combination of initiatives, i.e. a corporate venture capital arm (CVC), an incubator/ accelerator programme, an innovation lab, or a dedicated innovation unit. In order to maximize success, this new innovation ‘interface’ is combining various functions in new processes that aim to combine the best of both worlds of lean startup thinking and of customer centricity. These initiatives strive to build products and services derived from existing customer insights, through agile, mixed-teams of subject matter and industry experts.

Want to learn more on how-to-do, drop us an email and we will be happy to share our knowledge and insights with you!

For Hippocampus.io,
Christos Lytras – Managing Partner

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