Partner: Corporate Innovation Models with Build-Buy Partners
A growing approach to corporate innovation involves large organisations partnering and collaborating with small, high-growth startups. Joining forces with another company can help organisations create a culture that embraces innovation and allows for constant experimentation.
We recently sat down with Adrian Wong to discuss corporate innovation and the power of a partnering model. Adrian is the founder of Moxi AI, an AI-powered chatbot that performs the role of a social butler, and Chief Innovation Officer at Venture Agenda, who develops programmes to help forward-thinking businesses gain a competitive edge by identifying and engaging with emerging innovators in their target markets.
Challenges of Partnering to Drive Corporate Innovation
Adrian explained that both parties involved in the partnership must understand that corporate innovation can’t simply be instructed or commanded. Rather than telling employees how to think, partnering companies must establish a cohesive culture of innovation that empowers employees on both sides of the equation.
Adrian used the metaphor that large companies working with startups can be like “elephants dancing with mice”. As a result of poorly aligned company cultures and diverging business objectives, the larger organisation “steps on” and “crushes” the smaller.
Navigating internal processes, roles and professional values is an important challenge for executive leaders to overcome on both sides of a partnership. Unclear goals, unrealistic expectations, and unattainable timeframes will likely harm relationships and sabotage corporate innovation.
To ensure both partners see positive outcomes, companies must embrace experimentation and use the outcomes of these experiments to actively drive innovation. When businesses accept and understand the lessons from failed experiments, they have the opportunity to learn from the shortcomings and work to improve their product or service without the need for expensive investments.
Much like an acquisition, partnerships run the risk of companies losing control of their own decision-making as dominant partners try to cast their influence on smaller organisations. Typically, startups have their own growth agenda and look to explore multiple opportunities. Smaller partnering companies don’t just exist to build innovation for the larger corporates, and can even pivot entirely if they discover new use-cases for their product or technology.
Advantages of Partnering to Facilitate Corporate Innovation
According to Adrian, partnering can be a mutually beneficial way of nurturing corporate innovation in both large organisations and startups.
Beverage company Diageo and Thinfilm, a Norwegian tech-innovation startup, partnered together to create the first-ever “smart bottle”. The goal of the partnership was to improve the beverage supply chain, customer experience, and anti-counterfeiting efforts with Thinfilm’s proprietary OpenSense electronic sensors that can tell whether or not a bottle has been opened. The partnership was both a successful opportunity for Thinfilm to trial their technology and helped Diageo collect data to improve consumer satisfaction.
Large corporations have the scale, reach and industry expertise that can be an important asset to startups. Access to valuable assets, such as intellectual property or state-of-the-art technology, can be hugely beneficial for the growth of a smaller company. On the flip side, startups are known for their speed, which means they can help large organisations experiment more rapidly with innovative ideas and work quickly to build unique solutions to customer problems.
Partnering has the real potential to drive intrapreneurship, but in order to successfully build corporate innovation, the professional environment and company structure must be right. Finding a right-fit culture, setting clear objectives, and allowing opportunities for hands-on experience are all key ingredients for achieving the best results in a partnership.
When a team member from the larger organisation works within a startup for a period of time it’s much easier to combine company cultures as well as share practical experience and insights. Forming blended teams with a fresh perspective is an effective way to boost motivation, collaboration, productivity, and an intrapreneurial culture.
How Do You Choose the Right Corporate Innovation Strategy?
Now that you’re familiar with the different types of corporate innovation strategies, you need to pick the right one that aligns with your organisation and overarching objectives.
Whether you’re looking to build new innovation projects from the ground-up, identify the right buy opportunities for a speedy go-to-market strategy, or to collaborate through partnering with small, high-growth startups, every business has a unique set of needs when it comes to finding the optimal approach to corporate innovation.
At Studio Zao, we specialise in assisting organisations through the build phase by empowering intrapreneurs to effectively execute innovation and transformation. Nevertheless, we believe activating intrapreneurial talent and initiating transformational cultural change is key across all three systems and can have a meaningful impact on your organisations’ growth.