“Dancing elephants” was the term I heard used this week to describe corporations trying to be agile. Many corporations are looking to leverage the movements around lean startup, agile development and accelerators to change their cultures and bring new products to market faster. But it’s not an easy transition.
The rub is that these large businesses are not only not good at disruptive innovation, they are fundamentally organized to resist break-through change. We have known this for about 20 years, since Clayton Christiansen documented the phenomena in his 1997 book The Innovator’s Dilemma (1997): When New Technologies Cause Great Firms to Fail. He highlights that successful organizations with profitable business models lose their ability to innovate. “The reason is that good management itself was the root cause…The very decision-making and resource-allocation processes that are key to the success of established companies are the very processes that reject disruptive technologies… These are the reasons why great firms stumbled or failed when confronted with disruptive technological change”.
But now the business environment itself has fundamentally changed, particularly for mature companies that are under pressure like never before. A few months ago Steve Blank wrote the foreword for the The Startup Ecosystem Report Series from Compass.co. In it he highlighted the “decline of the blue chip” and noted the increased “topple rate” of S&P 500 companies. “Back in the 1930’s, a company coming on the S&P 500 list could expect to remain there for 65 years… the average life-time of a company on the S&P 500 has declined to about 15 years, a decline of almost 80%… Businesses … do not know how to adapt to the new conditions of the Information Era, and thus await a languishing future to be followed soon by death.” (See a few of Steve Blank’s blog posts on his observations working with large organizations below).
Over the last 15 years we have witnessed a new breed of startups that has been heavily funded by venture capital and are disrupting every industry. The examples are numerous in technology, media, hospitality, transportation and just about any other industry you can think of. Now the elephants feel they need to learn to dance or face extinction.
At the Citrix Startup Accelerator we help teach elephants how to dance and how to invest in the best startups and internal teams (intrapreneurs). In the last five years we have deployed seed capital into over 30 startups, with many now blossoming into areas like scalable super-computing, machine learning, real time identity management, optimized wireless networks and other key software stack areas.
In the last two years our three month Innovators Program has trailblazed a new framework for bringing design thinking, lean startup techniques and internal corporate teams together. We’ve been running our Accelerator for nearly 5 years now and with all the new accelerators coming to market, our program is still the only one that combines the most promising enterprise technology startups to work alongside internal corporate product teams in every cohort. We are currently running our fifth Innovators Program, and have worked with over 60 teams. We worked with partners such as Red Hat, Cherokee Fund, Arrow Electronics, Silicon Valley Bank, Ricoh Innovation, HQ Raleigh, StartupSB, Nasscom and internal Citrix business units pioneering our partner led, open innovation platform. If your company or organization would like to join us in running an Innovators Program please contact me at firstname.lastname@example.org.
Our current cohort in the Research Triangle Area will be pitching at our Demo Day on December 8th, 2015. If you would like to join and see eight startups and four internal teams present please RSVP here.
Making Elephants Dance – Lean Startup for Corporations. Presentation on SlideShare. http://www.slideshare.net/mac13/making-elephants-dance-lean-startup-for-corporations
Steve Blank’s blog posts over the last year as he has taken on the task of applying lean startup principals to large successful organizations. Check out:
Posted on September 9, 2015 by steveblank |
Corporate Innovation Requires an Innovation Culture
Innovation in an existing company is not just the sum of great technology, key acquisitions and smart people. Corporate innovation needs a culture that matches and supports it. Often this means a change to the company’s existing culture.
Posted on August 25, 2015 by steveblank |
I’ve spent this year working with corporations and government agencies that are adopting and adapting Lean Methodologies. The biggest surprise for me was getting schooled on how extremely difficult it is to be an innovator inside a company of executors. —– What Have We Lost?