Last time I talked about whether corporations should start acting like start-ups, <link>. This week, we'll discuss our incubation process and how corporations can include some of the best ideas of start-ups in their own organisation without throwing the company child out with the bathwater.
We might not have convinced you that there’s no need to start acting like a start-up in part 1. But hey, the fact you’re reading this means that you’re at least curious about the insights we can offer in what you can (and should) do to increase your speed and flexibility in innovation projects.
Let’s start by defining what it is that start-ups have and what you want to incorporate in your own organization:
- Flexibility: be able to change course faster and not lose time and energy in heavy decision processes
- Speed: deliver the most suitable solutions and learn from market feedback faster
In our opinion, the silver bullet for reaching these goals, lies in your most precious asset:
the self-organizing TEAM.
Give passionate people the means to reach their goals and responsibility.
They’ll move heaven and earth to get there.
To run an innovation project, you need a team that is passionate about an idea and has enough freedom and responsibility to bring the idea to life. In an ideal world, when it comes to mentality, you’d want the team to see things as if they’re running their own start-up.
Of course, that’s an utopia. They may be passionate about the idea and committed to see it come to life, but they didn’t invest in it as much as they would do if their own investment was at stake.
You can however create an environment for the team that allows them to develop the idea with a higher chance of success than most start-ups can achieve. The formula for success consists of 4 ingredients.
- Empower the team
- Give the team a clear mandate. They need to take responsibility to make things happen. Also, make them aware that they are responsible for the whole project, end to end.
- Align on a first version of a business model (e.g. lean canvas) and give the team a budget (euro’s and/or internal capacity such as IT man days) and the freedom to use it as they think best. The business model should focus on the idea and market/user fit. A detailed financial business plan is not what you are looking for at this point in the process.
- Protect them from anything that can slow them down
- Provide the team with a practical, inspiring workplace where they can closely work together. You can even consider locating them elsewhere, away from your office space.
- Remove the team members (temporarily or definitely) from their former operational duties & responsibilities so they can focus completely on the idea and the development process.
- Let the team benefit from corporate services (e.g. legal advice) but only if it supports them. Protect them from any interference or corporate processes that can slow them down.
- Provide them with the tools they need that leverage them to work efficiently and effectively. This should not necessarily be your corporate toolbox.
- Give the team an executive sponsor that can protect them against the habits of your own organization and let the team work independently from the governance and development processes that you apply for ‘standard projects’.
- Provide a lean innovation process & access to coaching
- Provide just enough structure and focus on ‘idea and assumption validation outside the company walls’.
- Support the team by giving them access to like-minded people with experience in innovation projects, agile methodologies and the lean start-up approach.
- Implement ‘just enough’ governance
- Guide the team by offering coaching and advice on the business model whilst not taking ownership of the idea. A recurrent follow up meeting and definitely product demos will leverage their motivation to make progress and also facilitate quick feedback loops.
- Consider the team as the management of the start-up. You are the investor.
- For each phase of the ‘idea development process’ agree on 1 KPI you will be monitoring (this preferably is not a financial KPI, definitely not in the early stages).
How we manage the innovation process at AE
Do what you say and say what you do, the proof of the pudding is in the eating. I would now like to share with you the highlights of our own ‘incubation process’ at AE. Innovation is in the heart of our company and is encouraged strongly by our consultants. The yearly Hackathon is a excellent example of focused innovation together with our clients & partners. But what happens after the Hackathon? And what if someone has a great idea at any given moment?
The answer: we are organized for innovation and have implemented the 4 guidelines that are mentioned above, tailored to our own specific context. Here’s how:
In short, this is what we do:
- We give our consultants the freedom to come and pitch an idea within a basic set of ground rules.
- We have a structured process with a big focus on external validation and de-risking the idea and concept without interfering in the idea itself. The process itself puts all responsibility within the team but we do state which learnings we expect them to achieve through each process phase.
- We have an innovation budget that is given to the teams in portions whilst they proceed in the process.
- Teams present their learnings and next steps to a small committee with mixed skills & expertise. This committee advises the team and frees up the budget for their next steps.
- We provide support for the teams by giving them access to an experienced innovation consultant that supports and challenges them during their journey. This leads to sharper ideas and more efficient validation approaches.
Thanks again for reading this far. I hope you can use some of our tips in your innovation approach. More questions or feedback? Leave a comment below.