How can innovation be made possible inside large organizations? originally appeared on Quora: the place to gain and share knowledge, empowering people to learn from others and better understand the world.
In the startup world, entrepreneurs don’t exist in a vacuum. They thrive because they have a counterpart: the early-stage investors who understand what success looks like in the earliest stages of building a business and therefore fund and support the startup commensurately through those stages. So to adapt this model for large organizations, you can’t just focus on the teams who are building new businesses as “intrapreneurs.” You also have to help leadership develop the venture capital mindsets and tools so they can evaluate, support, and fund the teams as they grow from new to big. Without that leadership mindset shift, there’s no point in the entrepreneurial activity.
Large organizations rarely have an ideas problem. When we start working with a new partner, we often see graveyards of great ideas that never became anything. They don’t have a capital problem – there’s always money that can be wrangled from “zombies” (projects that everyone knows are the walking dead) and redeployed toward real growth. And they don’t have a talent problem – there are entrepreneurs hiding all throughout the company that would love to be unleashed to do this kind of work. The real problem is a “how” problem; it’s the systems, and people processes, and governance frameworks that are designed for the “big to bigger” machine and which kill anything in the “new to big” side.
The leaders who succeed in large organizations are usually ones who are expert operators, which is important in the “big to bigger” machine where efficiency and optimization are king. But “new to big” requires the mindset and tools of a creator, and that’s just not something most senior leaders are comfortable with. But it doesn’t mean they can’t do it. It means they have to build out this new muscle, this new mindset that is adapted from how venture capital investors see the future. Once they do they become ambidextrous leaders, which is what positions them to win the future.
The last piece that is crucial inside large organizations is one that startups don’t have to deal with: the infrastructure and asset base of the big company. When it’s time to scale a business these things will become a powerful advantage over startups, but at the beginning they can hamper the speed of learning for an intrapreneurial team. So inside “new to big,” business functions like legal, finance, IT, marketing, people management, and compliance have to adapt their processes so they don’t inadvertently kill nascent businesses. We talk in the book about how to build out a cross-functional team whose job is to “get to yes” from these functions, when their natural instinct might be to say “no.” We don’t want to destroy those functions because they need to exist to protect the enterprise. We just need to adapt them in the sandbox that is “new to big.”
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