Large organizations can find it hard to innovate because of their size and the inherent difficulty in emphasizing change and risk while having to satisfy shareholder demands and the natural bureaucracy that arises in any large enterprise. However, with the increasing rate of change in business and the society at large, if they do not they run the risk of being left behind by their competitors.
A solution to this problem is for the organization to create startups, or small, nimble groups that can explore a given innovative approach without spending large amounts of capital or engaging in a restructuring of the whole organization. If they are successful more money and resources can be applied to corporate innovation startups.
Following are several approaches to corporate innovation startups:
• Corporate Accelerator Program – an accelerator program leverages the experience, expertise, resources, brand and distribution channels of a large organization by linking it with the talent, new thinking and speed of a startup to use both their respective strengths to come up with innovations and implement them more quickly than a startup alone could.
• Reverse Pitching Event – rather than startups pitching their ideas to investors, reverse pitching involves stakeholders to pitch what problems they would most like an organization to solve and to identify how this might be done and at what cost.
• Open Innovation Program – an open invitation is made to startups, entrepreneurs, indivduals, customers, partners and anyone else who has a good idea, to provide ideas in a given area that is ripe for innovation. Such programs can be run online and will elicit a wide range of thinking, some of the best can be rewarded with funding for implementation.
• Corporate Venture Capital – organizations have, by their nature, capital available to invest in innovation. By behaving the way that venture capitalists do when seeking out companies to invest in, they can invest in emerging ideas and gain financial exposure to companies that have large upside potential as well as being able to subsequently purchase them outright if their ideas are a good match.
• Sponsorship – sponsoring an industry event or co-working environment is a relatively inexpensive way to be exposed to new, innovative ideas in a space. Although the benefits are not necessarily tangible or guaranteed it may lead to ideas that can be nurtured through further investment by being involved with people that are seeking to innovate.