innovits aiesec29ottobre2014
DESCRIPTION
What large companies can learn from the working culture and methodos of startups The linear career path is long gone. Organizations need managers and executives with a high degree of diversity and curiousity to navigate through uncertainty. People who were exposed to a startup or involved in intrapreneurship experienceTRANSCRIPT
Startups and large companies.What large companies can learn from the working culture and
methods of startups and why you need to navigate through the two realities along your career
29 ottobre 2014
Roberto Sapio Stefano Mizio
Future Work Skills 2020
2
Understading of both culturesLarge companies and Startups
Different PerspectivesJanus two-faced
I started my career as a startupper…
Startupper
MBA
Country Sales manager in a large
company
Innovits
Roberto
Vodafone
MBA
Omnitel…
Silicon Valley
Startup
InnovitsStefano
I started my career in a fast growing company…long time ago
Senior Consulting
VUCA
Business Models have always lasted a long time
P. Hobcraft
Startup Definition
Steve Blank
What does a business model mean?
• “A business model is simply the ‘way of doing business’ that a firm has chosen: (Davenport, T. H., M. Leibold and S. Voelpel
(2006). Strategic Management in the Innovation Economy. Publicis Wiley.)
• “The business model is a company’s answer to the question of how to make money in its chosen business. It describes, “…as a system, how the pieces of a business fit together ” (Magretta, J. (2002). "Why Business
Models Matter." Harvard Business Review 80(5) May: 86-92.)
• A business Model is the the story of how value is created, delivered, and captured .
Here ...
Stability
Can you describe your Business Model?
Maybe not…because it has been in place since the business was started… It is taken for granted!
Are you aware of it?
"Business models are not meant to be static . In the world we live in today, you have to adapt and change. One of my fears is being this big, slow, constipated, bureaucratic company that's happy with its success. That will wind up being your death in the end." Nike CEO
S.. Kaplan
“In the twenty-first century business leaders are unlikely to manage a single business model for an entire career ”.
Blockbuster
Blockbuster was netflixed!
Netflix, netflixed
Verb:1.to cause disruption or turmoil to an existing business model2.To destroy a previously successful business model3.To displace the way value is currently created, delivered, and captured4.To be disrupeted, destroyed, or displaced by new business model.
S. Kaplan
Senior management were so busy pedaling the bicycle of their current business model they didn’t
think about and experiment with potential new ones.
David versus Goliath
Too big to produce game-changing inventions?
innovate?
Do you agree?
Uncertainty Ratio = Assumptions/Facts
Entrepreneurial management could be more important than
traditional management…
What if your best friend has a great idea…
Customer need
Example by Nathan Flurr
Instead of purchasing designer dresses, women might prefer the option of renting designer dresses online for special occasion.
What would you advise??“Write a Business Plan”
Product&Service Size of the market
Revenue&Profit based on projections of: pricing
costs
Unit volume
growth
Anything else?
Or …
Example by Nathan Flurr
You can suggest to set up an experiment to answer some “Key questions”
Will middle – to – upper class young women rent a designer if it is available at one-tenth
the retail price??Will women who rent dresses
return them in good condition??
Or…Would women rent dresses they couldn’t try on??
So …
Example by Nathan Flurr
• You can borrow or bought 100 dresses from designers;
• rent a location; advertise around your campus and invite young women and test your Hypothesis
This is exactly what happendThe experiment answerd the
first two questionsThis experiment resolved
some of uncertainty reflected in the two questions it was
designed to answer.
“its inventory dressed 85 percent of the ladies who attended President Obama’s second inauguration”
Example by Nathan Flurr
Performance Engine
Traditional management theorycertain type of problem: attempting to optimize
under conditions of relative certainty
Houston we have a problem
New business ideas –outside and inside organizations – are characterized by a
different type of conditions:
uncertainty
How can we lower costs by 5%?
The right style of management
by Nathan Flurr
Will people buy products over the internet? ( Amazon )
A riddle
Alfred SloanGeneral Motors
Billy DurantFounder of General Motors
Guess Guess
Guess
Guess
GuessGuess
Guess
GuessGuess
Untested hypotheses
The best you can do is guess and you may be wrong…
Business Model Canvas by A. Osterlwalder
Chief Experimenter vs Chief Decision Maker
How and Where decisions are made
“…you know how big companies make decisions: they tend to rely on politics, Powerpoint and
persuasion.” Tim Cook - Intuit
Let’s consider this case
You have to choose between two investement proposals:• a team of young entrepreneurs hoping to bring word-of-mouth marketing to China (team A)• Seasoned team inside large company looking to tap into a growing segment adjacent to its current business (team B).
• They forged their idea in the “white hot heat” of the market.• Many assumptions that remained were grounded in the Real World of Experience.
Team A
• They forged their idea in the lights of the conference room.• The plan was based on assumptions the team didn’t even realized it was making.
Team B
By A. Scott D. Anthony
Team A got founded
By A. Scott D. Anthony
Why?
• They had spent significant time in the market pitching their idea to potencial corporate customers.
• They simply hadn’t done the fieldwork.•The proposal underestimated how unique the value proposition was compared with offerings from competitors/startups.
The Ratio of the time spent preparing for and attending internal meeting to the time spent in the market < 1:3
Team A Team B
By A. Scott D. Anthony
Team A fits the right “process to make decisions”
Experiments
A new strategy for entrepreneurship in the 21 st corporation
• forming “leap of faith” assumptions;
• rapid testing those assumptions through experiments;
• letting the data make the decisions.
What’s the fastest way to get an experiment to test that idea?Vs. traditional approach (build and deliver)
Steve Blank
Startup and established company
“In God we trust,all others bring data.”
- W. Edwards DemingOngoing operation (90% data, 10% unknowns): central focus is to execute the plan.Innovation initiative (10% data, 90% unknown): the plan is a hypothesis.
There is comfort in Data ☺
The Value Hypothesis The Growth Hypothesis
The Minimum Viable Product
Leaps of faith assumptions
Eric Ries
We have a set of management practices and theory
Customer Development Modelor How we search for the business Model
Learning and DiscoveringDesign experiments, start listening
• there are no fact inside your building • testing your hypotheses outside the building• no business plan survives first contact with customer
Pivot
Search Execution
Steve Blank
By S. Blank
Core Principles: scientific method
The two worlds are coming together
Implications for Big Companies…
21st organizations
Established Companieshard-to-replicate advantages over start-ups
Entrepreneurial approach/method
Experimentation/ get out of the building : diagnostic camps to identify potential patients or
engaging in customer discovery
Business Model Validation
Open minded
Observation
Humility
Unique capabilities
Partner relationships
Strong Brand Reputation: local doctors/ Regulatory approval/…
“Last mile” distribution channels
Process and internal resources: design, staffing and execute
pilots and expanding programs
Recombining existing capabilities
Break all the rules?
You are the Innovation leader and just joined the company. You live the “ startup garage” culture
The CEO told you : “guy, we must innovate!What do you do?
Again, Break all the rules?
Ok, Hero, What do you do?
You can say: we , the innovators, are a blessed a superior lot
They can say: you seem to think you are superior, you get all the glory,…
No custom organizational model in placeOngoing Operation Innovation
Strategy
Organizing &
Planning
Execution
V. Govindarajan – C. Trimble : The other side od Innovation
Making Innovation Happen
Something missingAgile approach? What kind of relationships?
Skills? Operating rythym?
?
Committing to an Innovative
Idea
“Great idea! Go make it happen”
Trap: usingexisting
processes
Organizing an innovation initiative
Company
Performance Engine
Shared Staff
Dedicated Team
Partenrship
V. Govindarajan – C. Trimble : The other side od Innovation
Intrapreneurship Startup – acqui-hiring
Intrapreneurship/Corporate Entrepreneuship
Intrapreneurship can be definedas using entrepreneurial skillswithout taking on the risks oraccountability associated withstarting your own business.Instead, intrapreneurs areemployees in larger organizations,who act as entrepreneurs whilehaving the resources andcapabilities of the larger firm todraw upon
Corporate Entrepreneurship: isthe process by which individualsinside organizations pursueopportunities without regard to theresources they currently control(Stevenson)
What are the challenges of partnership??
List
Competition with Performance Engine leaders for scarse resources
Remember: one person against the system is an extraordinarily bad bet
The divided attentions of the guys in the P. Engine you need
Disharmony in the partnership
Managing Diversity
Dedicated Team
(Startup)
Performance Engine
Conflicts must be anticipated, mitigated or neutralized
Summarizing…
• Organizations need more “innovation” but don’t know how to do it.
• Established companies are Performance Engine with an “ efficiency uber alles” culture.
• A new set of methodologies are emerging from startups (lean startup, customer development, agile approach).
• Reverse mentoring is taking place (millenials –digital native).
• Large organizations need new perspective ( startup or intrapreneurship).
Having experience within corporates and startups can give you different perspectives and methods to manage uncertainty and your personel career.
The linear career path is long gone
Bridge Building
Innovits is committed to bridge the gap!
InnoVits is a non-for-profit organization who iscontributing to create an Entrepreneurial,Innovation-Based Economy fostering startupmethodologies and contaminating traditionalmanagement practices and culture.
A BRIDGE BEETWEEN TWO CULTURES
STARTUP MANAGEMENT
EXCHANGE COLLABORATION
A new Breed of manager
Organizations need a structure and a corresponding culture where accelerated change is
the new normal. It requires an environment, a strategy in which experimentation and pioneering is the most common thing to do in order to be able
to innovate.
Innovation begins with your look at the world
This talk...
By Frits Oukes
Illustration from the film Bakara 1992
It’s a matter of perspective