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- Herausgeber: John Wiley & Sons
- Kategorie: Fachliteratur
- Sprache: Englisch
Build an innovative new startup using the resources of an existing corporation The Corporate Explorer Fieldbook: How to Build New Ventures in Established Companies is a one-of-a-kind collection of the tools, methodologies, and techniques you need to build successful, market-ready ventures from within existing organizations. The accomplished authors explain how to develop a practical strategy, gather market insights, develop a Jobs-To-Be-Done market canvas, collect customer research, reduce organizational risk, and more. You'll learn how to beat the odds when introducing a new product or service into the marketplace and how to select, develop, and compensate the right people in your company to act as corporate explorers. Finally, the book explains how to secure authentic and enthusiastic buy-in for your new venture at the executive level. The Corporate Explorer Fieldbook will also teach you to: * Conduct micro-experiments to distinguish legitimate business opportunities from ideas that lack traction * Perform customer discovery interviews for ideating, incubating, and scaling ideas * Generate breakthrough ideas from within large companies An indispensable companion to the newly published Corporate Explorer: How to Build New Ventures in Established Companies, the Corporate Explorer Fieldbook is a must-read, step-by-step guide for corporate entrepreneurs seeking to launch new ventures from within their existing organizations.
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Seitenzahl: 403
Veröffentlichungsjahr: 2023
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Table of Contents
Cover
Title Page
Copyright
Dedication
Preface and Acknowledgments
NOTE
CORPORATE EXPLORATION: INSIGHTS FROM THE FIELDnoteSet
NOTES
SECTION I: STRATEGIC AMBITION
CHAPTER 1: Strategy Manifesto: Answering the Big “Why”
A PROBLEM WITH STRATEGY PLANS
COMPONENTS OF A STRATEGY MANIFESTO
CREATING A STRATEGY MANIFESTO
INFLUENCER APPROACH
CHAPTER 2: Hunting Zones: Selecting Where to Explore
HUNTING ZONE
BOUNDED DIVERSITY
DEFINING HUNTING ZONES
NOTES
CHAPTER 3: Outside‐In: Overcoming Toxic Assumptions with Market Insight
WE HAVE MET THE ENEMY, AND HE IS US.
CHALLENGING TOXIC ASSUMPTIONS
GOING BEYOND CUSTOMER‐LED
LEARN FASTER
NOTES
CHAPTER 4: Jobs‐to‐be‐Done: Defining a Market by Customer Outcome
MARKET DEFINITION
HOW SHOULD A MARKET BE DEFINED?
JOBS‐TO‐BE‐DONE MARKET DEFINITION CANVAS
CHAPTER 5: From Explorer's Insight to Opportunity Story
STARTING POINT
EXPLORER'S INSIGHT
OPPORTUNITY SCREENER
OPPORTUNITY STORY
NOTES
SECTION II: INNOVATION DISCIPLINES
CHAPTER 6: Ideation from Within: How to Generate Breakthrough Ideas from Within Large Corporations
IDEATION
IDEAS
IMAGINE
DISSECT
EXPAND
ANALYZE
OVERCOMING BARRIERS
NOTES
CHAPTER 7: Ideation from Outside: A Step‐by‐Step Guide to Challenge‐Driven Innovation
OPPORTUNITY FOR EXPLORERS
NETWORKED PROBLEM SOLVING
OPEN IDEATION'S UNIQUE POTENTIAL
CHALLENGE‐DRIVEN INNOVATION
FIVE TRAITS OF A “GOOD” CHALLENGE
BASICS OF THE CDI PROCESS
IDEAS MATTER
NOTES
CHAPTER 8: Business Model Maturity: Using Customer Evidence to Validate New Ventures
CUSTOMER FIRST
MATURITY GAP
CLOSING THE MATURITY GAP WITH EVIDENCE
INDICATORS OF BUSINESS MODEL MATURITY
ASSESSING THE MATURITY GAP
CHAPTER 9: Get Out of the Building: How to Gather Customer Discovery Data with Interviews
OUTSIDE‐IN LOGIC
TALKING TO CUSTOMERS
CUSTOMER INTERVIEWS FOR IDEATING, INCUBATING, AND SCALING
DOS AND DON'TS OF CUSTOMER INTERVIEWS
NOTES
CHAPTER 10: Value Propositions: Using Value Flows and Design Criteria Maps to Create Customer Delight
INSIGHT TO DELIGHT
CREATING VALUE FLOW AND DESIGN CRITERIA MAP
NOTE
CHAPTER 11: Business Experiments: De‐risking Execution Spend Through Experiments
INSTINCT OR DATA
DE‐RISKING INNOVATION
STRUCTURED LEARNING CYCLES
NOTES
CHAPTER 12: Ecosystems: Building an Ecosystem Playbook for Scaling a New Venture
CO‐INNOVATION
BUILDING THE ECOSYSTEM PLAYBOOK
KEY SUCCESS FACTORS
NOTES
CHAPTER 13: Validation: Managing the Journey from Concept to Scale
HUNTER STRATEGY
VENTURE MATURITY
GROWTH VALIDATION PROCESS FOR CORPORATE VENTURES
NOTES
SECTION III: EXPLORE ORGANIZATION AND LEADERSHIP
CHAPTER 14: Ambidextrous Organization: What It Is, When to Use It
SEPARATING EXPLORE FROM CORE
AMBIDEXTROUS ORGANIZATION DECISION
FOUR SUCCESS FACTORS
NOTES
CHAPTER 15: Explore Unit: How to Build a Team for Exploration
RHYTHM OF EXPLORE
PURPOSE
RESOURCE ALLOCATION
DECISION MAKING
TEAM
OPERATING MODEL
NOTES
CHAPTER 16: Strategic Diversity: Selecting and Developing Corporate Exploration Teams
EXPLORE TEAMS
STRATEGIC DIVERSITY
GROWTH CURVES
HUMAN BEHAVIOR
IMPLICATIONS FOR CORPORATE EXPLORERS
NOTE
CHAPTER 17: Leading High‐Stakes Conversations: Getting the Senior Team Onboard
SENIOR TEAM COMMITMENT
VALUE OF TENSION
CREATE: GETTING THE CONVERSATION INTO THE ZONE OF PRODUCTIVE TENSION
CONTROL: KEEPING THE CONVERSATION IN THE ZONE OF PRODUCTIVE TENSION
CLOSING TENSION
PRODUCTIVE TENSION TECHNIQUES
NOTES
CHAPTER 18: Leadership Movement: Enrolling Others in the Work of Transformation
EXPLORER AS CHANGE AGENT
BUILD A MOVEMENT
ENROLL MEMBERSHIP
ENGAGE COMMUNITY
EMBRACE RESISTANCE
TRIGGER A HERD INSTINCT
NOTES
CHAPTER 19: Organizational Culture: The Silent Killer of Exploration
CORE AND EXPLORE
CULTURE AND CULTURE CHANGE
CREATING AND CHANGING CULTURE
USING THE LEASH MODEL: CULTURE CHANGE AT MICROSOFT
CONCLUSION
IMPLICATIONS
NOTES
APPENDIX FRAMEWORKS
APPENDIX 1
APPENDIX 2
APPENDIX 3
APPENDIX 4
APPENDIX 5
APPENDIX 6
APPENDIX 7
APPENDIX 8
APPENDIX 9
LIST OF FIGURES AND TABLES
ABOUT THE AUTHORS
ELLIE AMIRNASR
ANDREW BINNS
ANDREAS BRANDSTETTER
SARA CARVALHO
VANESSA CEIA
VINCENT DUCRET
YANIV GARTY
GEORGE GLACKIN
JOHN GRECO
CHRISTINE GRIFFIN
SIMON HILL
EUGENE IVANOV
UWE KIRSCHNER
KAIHAN KRIPPENDORFF
ERICH KRUSCHITZ
NARENDRA LALJANI
MICHAEL NICHOLS
PROFESSOR CHARLES A. O’REILLY, III
ALEXANDER PETT
RICHARD ROBERTSON
BEA SCHOFIELD
SARAH SPOTO
PROFESSOR MICHAEL L. TUSHMAN
TONY ULWICK
KRISTIN VON DONOP
CHARLES VAILLANT
INDEX
End User License Agreement
List of Tables
Chapter 3
Table 3.1 Questioning existing assumptions.
Table 3.2 Understanding the consumption chain.
Chapter 9
Table 9.1 Interviewing at the ideation stage.
Table 9.2 Interviewing at the incubation stage.
Table 9.3 Interviewing at the scaling stage.
Table 9.4 Preparing interviews.
Table 9.5 Conducting interviews.
Table 9.6 Summarizing and analyzing interview data.
Table 9.7 Interviewing potential customers in Kenya.
Table 9.8 Customer interviews key insights.
Chapter 11
Table 11.1 Experiment method examples.
Chapter 15
Table 15.1 Explore decision‐making bodies.
Table 15.2 Explore business decision rights.
Table 15.3 SanusX business decision rights.
Chapter 18
Table 18.1 Roles in the leadership movement.
List of Illustrations
Chapter 1
Figure 1.1 Strategy manifesto template.
Chapter 2
Figure 2.1 A four‐step approach to hunting zone development.
Figure 2.2 Innovation streams map (automotive industry example).
Figure 2.3 Hunting zones and selection criteria.
Chapter 3
Figure 3.1 Customer needs matrix.
Chapter 4
Figure 4.1 JTBD Market Definition Canvas.
Chapter 5
Figure 5.1 Blank opportunity screener.
Figure 5.2 Cherrisk opportunity screener example.
Chapter 6
Figure 6.1 The IDEAS framework.
Figure 6.2 The “difficulty‐impact” matrix.
Chapter 7
Figure 7.1 Challenge‐driven innovation framework.
Figure 7.2 The CDI method: A step‐by‐step guide.
Figure 7.3 Prioritization grid.
Chapter 8
Figure 8.1 Inside‐out innovation cycle.
Figure 8.2 The maturity gap between predevelopment and business units.
Chapter 9
Figure 9.1 Customer discovery timeline.
Chapter 10
Figure 10.1 Value flow for putting on a shoe, with and without Velcro fasten...
Figure 10.2 Design‐criteria map for putting on a shoe, with and without Velc...
Figure 10.3 Value flow for cleaning a floor.
Figure 10.4 Design‐criteria map for cleaning a floor.
Chapter 11
Figure 11.1 Business experiment learning cycle.
Figure 11.2 Riskiest assumptions to test (RATs) matrix.
Figure 11.3 The experiment card: Structuring testing of an assumption.
Figure 11.4 Vehicle subscription service: Identifying assumptions to test fi...
Figure 11.5 Vehicle subscription service: Testing customers' interest for mu...
Chapter 12
Figure 12.1 Value‐creation journey.
Figure 12.2 Value‐creation journey: Breakpoints.
Figure 12.3 Ecosystem Evaluation Template.
Figure 12.4 The Scaling Path Template.
Figure 12.5 Best Buy health scaling path.
Chapter 13
Figure 13.1 Five stages in the life of a corporate venture.
Figure 13.2 “Hunter Strategy” concept: How to build $100 million in annual r...
Chapter 14
Figure 14.1 When is ambidexterity needed?
Figure 14.2 Ambidextrous organization design.
Figure 14.3 AGC group strategy (from the AGC Annual Report, 2022).
Figure 14.4 Ambidextrous R&D approach (from the AGC Annual Report, 2022)....
Chapter 15
Figure 15.1 Explore unit members' skills.
Figure 15.2 SanusX organization chart for the first two years.
Chapter 16
Figure 16.1 The growth curve.
Figure 16.2 The AEM‐Cube assessment.
Chapter 17
Figure 17.1 Understanding productive tension.
Figure 17.2 Adjusting tension to maintain dialogue.
Figure 17.3 Create tension.
Figure 17.4 Four‐Player Model.
Chapter 18
Figure 18.1 Mapping stakeholders.
Chapter 19
Figure 19.1 Levers for culture change: The LEASH model.
Guide
Cover Page
Title Page
Copyright
Dedication
Preface and Acknowledgments
Corporate Exploration: Insights from the Field
Table of Contents
Begin Reading
Appendix Frameworks
List of Figures and Tables
About the Authors
Index
Advertisement
Wiley End User License Agreement
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CORPORATE Explorer Fieldbook
How to Build New Ventures in Established Companies
INTRODUCTION BY MICHAEL TUSHMAN
ANDREW BINNSEUGENE IVANOV
Copyright © 2023 by John Wiley & Sons, Inc. All rights reserved.
Published by John Wiley & Sons, Inc., Hoboken, New Jersey.
Published simultaneously in Canada.
No part of this publication may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, scanning, or otherwise, except as permitted under Section 107 or 108 of the 1976 United States Copyright Act, without either the prior written permission of the Publisher, or authorization through payment of the appropriate per‐copy fee to the Copyright Clearance Center, Inc., 222 Rosewood Drive, Danvers, MA 01923, (978) 750‐8400, fax (978) 750‐4470, or on the web at www.copyright.com. Requests to the Publisher for permission should be addressed to the Permissions Department, John Wiley & Sons, Inc., 111 River Street, Hoboken, NJ 07030, (201) 748‐6011, fax (201) 748‐6008, or online at http://www.wiley.com/go/permission.
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Limit of Liability/Disclaimer of Warranty: While the publisher and author have used their best efforts in preparing this book, they make no representations or warranties with respect to the accuracy or completeness of the contents of this book and specifically disclaim any implied warranties of merchantability or fitness for a particular purpose. No warranty may be created or extended by sales representatives or written sales materials. The advice and strategies contained herein may not be suitable for your situation. You should consult with a professional where appropriate. Further, readers should be aware that websites listed in this work may have changed or disappeared between when this work was written and when it is read. Neither the publisher nor authors shall be liable for any loss of profit or any other commercial damages, including but not limited to special, incidental, consequential, or other damages.
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Library of Congress Cataloging‐in‐Publication Data
Names: Binns, Andrew (Managing principal), editor. | Ivanov, Eugene (Innovation advisor), editor.
Title: Corporate explorer fieldbook : how to build new ventures in established companies / edited by Andrew Binns and Eugene Ivanov.
Description: Hoboken, New Jersey : Wiley, [2023] | Includes bibliographical references and index.
Identifiers: LCCN 2023010333 (print) | LCCN 2023010334 (ebook) | ISBN 9781394159222 (paperback) | ISBN 9781394159246 (adobe pdf) | ISBN 9781394159239 (epub)
Subjects: LCSH: Technological innovations. | Creative ability in business. | Corporations.
Classification: LCC T173.8 .C695 2023 (print) | LCC T173.8 (ebook) | DDC 303.48/3–dc23/eng/20230314
LC record available at https://lccn.loc.gov/2023010333
LC ebook record available at https://lccn.loc.gov/2023010334
ISBN: 9781394159222 (Paperback)
ISBN: 9781394159239 (ePub)
ISBN: 9781394159246 (ePDF)
Cover Design: Paul McCarthy
In memory of Melissa Annette Ellis
—Andy
In memory of Tatjana Ivanova and Leonid Ivanov
—Eugene
PREFACE AND ACKNOWLEDGMENTS
THE REAL WORK for an author starts after the book is published. Since Corporate Explorer: How Corporations Beat Startups at the Innovation Game (co‐authored with Professors Charles O'Reilly and Michael Tushman)1 was published in spring of 2021, Andy Binns has been on the road. He has spoken with hundreds, if not thousands, of innovation practitioners who run innovation programs within large corporations in different industries all around the world.
They were inspired by the real‐life stories of leaders who built new businesses inside large corporates, such as IBM, RELX, UNIQA, and Analog Devices. They recognized themselves not as entrepreneurs, but as Corporate Explorers, a distinct role inside corporations that may not attract the same attention as their startup brethren, but still generate extraordinary results.
In May 2022, our friends at Robert Bosch GmbH convened a conference, Corporate Startup Fusion, bringing together a wide range of innovation practitioners from across Europe. What was clear from presentations, discussions, and conversations was how much insight and experience about corporate exploration existed inside corporations. There is no question that management gurus and academics make an important contribution — through concepts, methodologies, and canvases – but in many ways practitioners are far ahead of them. Business school professors talk; these people do.
This realization was the seed for this book. A kitbag full of practical, time‐tested methods and tools applicable to every step of the new venture‐building process, written by and for the Corporate Explorers themselves. It covers much of the same territory as the previous book, but goes deeper, presenting even more details on how to define ambition and hunting zones for a corporation; how to ideate, incubate, and scale new ventures; and how to build and implement an ambidextrous organization.
Each large company is different, so it's next to impossible to invent methods and techniques that would work the same way everywhere, every time. Reflecting this point, Corporate Explorer Fieldbook is not a textbook or recipe. It's not a collection of answers; rather, it's a library of questions. We want every Corporate Explorer to start a new project — or a new phase of the ongoing project – with a set of questions that would guide their activity. The answers will be different for every Corporate Explorer – depending on the industry they operate in or the nature of their project – but asking these questions will make their job more effective and, eventually, more successful.
Corporate Explorer Fieldbook has two pillars. One of them is the foundational research performed by Professors Charles O'Reilly of Stanford and Michael Tuchman of Harvard. For years, Charles and Michael have been describing structures and tools that allow large firms to explore, that is, to create new ventures while fully exploiting all the assets provided by the core business. Central to this process is their concept of ambidextrous organization, an organizational type that makes disruptive innovation in large companies possible. Charles and Michael's contribution also includes their painstaking description of the three major disciplines of innovation: ideating, incubating, and scaling.
All our authors have been tremendously responsive and collaborative to work with, which is a great experience for us. Thanks to Andreas Brandstetter, Narendra Laljani, Tony Ulwick, George Glackin, Kaihan Krippendorff, Bea Schofield, Simon Hill, Uwe Kirschner, Michael Nichols, Vanessa Ceia, Sara Carvalho, John Greco, Erich Kruschitz, Richard Robertson, Alex Pett, Kristin von Donop, Michael Tushman, Charles O'Reilly, Sarah Spoto, and Yaniv Garty for their excellent contributions. However, we must reserve special thanks to our colleagues, Christine Griffin and Vincent Ducret, who have been tireless in their efforts to bring our vision to fruition, working on many chapters, reviewing drafts, and acting as thought partners.
The other pillar is Change Logic, a firm Andy, Charles, and Michael co‐founded in 2007 together with Peter Finkelstein. Change Logic has worked with some of the most innovative firms in the world, and through this work, sharpened our understanding of what Corporate Explorers need to carry in their toolboxes to be successful. Some of our former and current clients have become friends; a few of them showed their friendship by agreeing to contribute to this book as authors. Our Change Logic team has been a constant source of ideas and support – even those who have not contributed a chapter. This book is very much a team effort. Thanks to Aaron Leopold, Nishi Gupta, Alina Cowden, and Sara Orlando. We also thank the many Corporate Explorers we have met over the years. They are the inspiration for our work and originators of so much that we are sharing with our readers.
Most of all we thank Mike Tushman and Charles O'Reilly for their inspiration and guidance. They have touched all the contributors to this book in different ways, through their research, writing, and teaching. This book is another example of how they multiply that impact through patient mentorship and support to the many others who seek to carry their work forward.
—Andy Binns and Eugene Ivanov, Massachusetts, USA, February 2023
NOTE
1.
A. Binns, C. O'Reilly, and M. Tushman,
Corporate Explorer: How Corporations Beat Startups at the Innovation Game
(Wiley, 2022).
CORPORATE EXPLORATION: INSIGHTS FROM THE FIELD
Michael Tushman
AS AN UNDERGRADUATE in electrical engineering at Northeastern University, I participated in its co‐op program for which the school is rightly famous. It gave me not only intensive classroom time, but also hands‐on work experience. My co‐op assignment for four years was with the firm General Radio, at that time a leader in automatic test equipment, and already a 50‐year‐old company. During my time at General Radio, HP and Tektronics initiated several major technological advances in test equipment design and production. General Radio had no answer for these competitive provocations, which precipitated a crisis for the company. After a shift in strategy, structure, and culture, General Radio reemerged as GenRad, a different company, quite unlike the one that I had joined. As a budding electrical engineer, I had experienced my first example of reactive punctuated change.
General Radio had to experience a crisis before it could adapt to the market. I was profoundly puzzled that a company with all the resources of a successful enterprise and staffed with brilliant engineers should struggle, so hard and so unsuccessfully, to shape its fate. This experience led me to three critical questions that have shaped my subsequent career as a scholar of innovation and change and as an advisor to firms at technological junctures. Why is it that successful firms like General Radio frequently fail at the moments of industry transition? What can they do to be more dynamic and adaptable at these critical points? And how do they execute these changes?
The “why” question is well understood. This is the story of organizational inertia. The more successful a company gets, the more well‐honed it becomes at delivering more of the same. Of course, this generates lots of long‐term value and is a rich source of innovation at the core business. However, it welds the organization – its structures, processes, people, and culture – to the job of optimizing its existing business. Great for delivering results today, but when the world changes, it leaves them vulnerable to what my colleague Don Sull describes as “the dynamics of standing still.” Organizational renewal has been the core of my work since that searing experience at General Radio.
The “what to do” question led me, my students, and my colleague Charles O'Reilly to the concept of the “ambidextrous organization.” Structural ambidexterity creates a formal separation inside the company between two tasks, the one of optimizing the core business and the one of exploring into new domains. The notion of structural ambidexterity has taken some time to catch on as an approach. I remember vividly colleagues at Columbia Business School and Harvard Business School telling me that it was “a lovely idea, but could never work in practice.” Better for incumbents either to spin out this exploration work or to leave it to entrepreneurs. Then, I had the privilege of pragmatically exploring these ideas with IBM in the late 1990s and early 2000s. Under the leadership of Lou Gerstner and Sam Palmisano, IBM created a string of emerging business opportunities that applied the ambidextrous approach with great success, yielding a quarter of the company's profits by 2010. Working with Charles O'Reilly and Bruce Harreld (IBM strategy head and then HBS colleague), we explored factors that discriminated between more versus less successful examples of core and explore at the business‐unit and corporate levels at IBM. IBM subsequently suffered a tough decade, but it has survived several industry transitions, while rivals, such as EMC, Sun Microsystems, HP, and CSC, all struggled and were eventually acquired or restructured.
However, there was still a gap. While we knew that structural ambidexterity was one solution to the innovator's dilemma, it required much from the senior leadership team. Paradox, contradiction in the face of historically rooted inertia, often held incumbents hostage to their pasts. Charles and I became interested in the issue of how to execute ambidexterity. From my position in the classroom at Harvard Business School and boardrooms with Change Logic, a consulting business that I co‐founded with Andrew Binns and Charles, we have learned much about how to execute ambidexterity and associated punctuated organizational change. Through Change Logic's work with a range of firms, we have developed a point of view on both the “what” and the ”how” of strategic organizational renewal. The number of firms applying the ambidextrous solution is substantial. I now have research‐ and practice‐based responses to my car‐pool friends from General Radio so many years ago!
While our initial books explored the “what” of structural ambidexterity, what was missing was a deep dive into the “how.” How do firms explore into emerging areas so that they can lead more of critical transitions, rather than finding themselves the victims of disruption? This is the work of Corporate Explorers. They ideate, incubate, and scale new ventures, so that incumbent firms could use these ventures to navigate through times of high uncertainty. Our 2022 book, Corporate Explorers: How Corporations Beat Startups at the Innovation Game,1 told stories of multiple leaders who had the commitment and personal passion to lead these new ventures.
This new book goes a step further by having practitioners themselves explain how they achieve such extraordinary results. It combines the insights of innovation managers, company executives, strategic advisors, and scholars to present a comprehensive guide to the work of Corporate Explorers. That's why the book is titled Corporate Explorer Fieldbook.
Corporate Explorer Fieldbook follows a similar structure to the previous one. It has three main sections: Strategic Ambition, Innovation Disciplines, and Explore Organization and Leadership.
Strategic Ambition refers to the need of providing an overarching vision that elicits compelling emotional purpose and guiding strategic rationale for exploration.
Chapter 1 describes how to turn high‐level corporate statements into an empowering Strategy Manifesto that helps align senior leaders on the ambition and then communicate this ambition to their organizations. This chapter is co‐authored by Andrew Binns and his client for many years, Andreas Brandstetter, CEO of UNIQA Insurance Group and President of the General Assembly of Insurance Europe.
Chapter 2, written by Andrew Binns, takes one step forward by describing how firms can select Hunting Zones for their exploratory efforts. This helps align the energy and inventiveness of the Corporate Explorer with the strategic intentions described in the Manifesto.
The next two chapters offer two different lenses on the same question: How to select the starting point of exploration? Chapter 3 by Narendra Laljani argues for an outside‐in market learning as an antidote to the toxic assumptions that develop within successful incumbent firms and blind them to the shifts in customer behavior. In Chapter 4, Tony Ulwick describes how to define markets from the customer's viewpoint, by using the concept of jobs‐to‐be‐done.
Chapter 5 brings these threads together by focusing on how Corporate Explorers win support for exploration. George Glackin outlines how Corporate Explorers first decide which opportunity to pursue and then develop an opportunity story that explains to investors why a new venture deserves funding.
The second section, Innovation Disciplines, comprises a series of chapters on ideating, incubating, and scaling new ventures. These are the essential practices that a Corporate Explorer needs to apply to convert an idea into a revenue generating business.
In Chapter 6, Kaihan Krippendorff presents his methodology for ideating from within the companies, explaining how to liberate the insights of the company's employees. Chapter 7 turns to ideation from the outside, as Simon Hill and Bea Schofield describe how the challenge‐driven‐innovation methodology can be used to tap on the intellectual power of external crowds.
The next six chapters take deep dives into the topic of incubating new ventures. These are practices that seem relatively straightforward from the outside but are difficult in real life as they run counter to the culture of delivering predictable results from the core business. That makes the lessons from Bosch, General Motors, and P&G of such great value.
Chapter 8 frames the challenge of incubation as one of business model maturity. Uwe Kirschner and Michael Nichols describe a methodology, developed at Robert Bosch GmbH, for assessing when a venture has matured sufficiently to justify further investment.
Vanessa Ceia and Sara Carvalho leverage the lessons learned at Bosch to present, in Chapter 9, some practical tools to be used in the process of customer discovery.
In Chapter 10, George Glackin teaches how Corporate Explorers can develop a value proposition that would persuade both their colleagues and upper management to support the development and launch of the new venture.
In Chapter 11, Sara Spoto and Vincent Ducret introduce us to the art and science of business experimentation, a process of testing a Corporate Explorer's instincts and assumptions against the sets of on‐the‐ground data demonstrating that an idea is worth pursuing (or not).
The next two chapters specifically deal with the process of scaling new ventures.
It's not often that a Corporate Explorer has all the means at their disposal to scale a new venture. However, these means can be acquired through “ecosystems” composed of other market players. To address this important point, Christine Griffin and John Greco outline, in Chapter 12, steps Corporate Explorers need to take to develop their ecosystem playbooks, based on work that they did together at Analog Devices.
To make scaling of a new venture a disciplined, data‐driven process, Corporate Explorers need success metrics. Developing these metrics isn't easy, and in Chapter 13, Ellie Amirnasr and Charles Vaillant describe three metrics, developed at MANN+HUMMEL, that measure a new venture's progress toward success.
The final section of the book, Explore Organization and Leadership, addresses the organizational aspects of new venture creation and touches upon an all‐important topic of leadership.
In Chapter 14, my friend and colleague, Charles O'Reilly, and I explain the concept of ambidextrous organization. This is a decision for the Corporate Explorer, or more likely for their senior sponsor and perhaps even for the CEO, to make about how best to structure the organization for success. Some innovations can succeed from inside the core business; others are appropriate to spin out in a venture studio or some other vehicle. However, the strategically important ones that can go faster by leveraging the firm's existing assets need an ambidextrous approach.
Once the decision to create an ambidextrous organization has been made, it's time to begin building an exploratory unit, and in Chapter 15, Christine Griffin and Erich Kruschitz describe practical steps to realizing this goal, using the example of SanusX, an explore venture launched by the Austrian insurance firm, UNIQA.
Richard Robertson reminds us, in Chapter 16, of the importance of the strategic diversity of innovation teams. We each have preferences that align us with different roles in the growth of a new venture: some are natural explorers; others bring structure and apply discipline. There is no right profile; the task is to match the composition of the team to the current stage of the venture development.
In Corporate Explorer, we talked about the risk of “silent killers” of innovation, borrowing a term coined by my colleague, Mike Beer.2 These are largely the same forces of organizational inertia that I experienced so vividly at General Radio. In Chapter 17, Alex Pett discusses how to have high‐stakes conversations with senior team members, who may be ducking the important issues facing a new venture. Alex also describes how Corporate Explorers can learn to create and maintain constructive tension.
However, “silent killers” are only overcome by enrolling many other people in the work of transformation. This is what we call a leadership movement. In Chapter 18, using the example of their work with Intel Israel, Yaniv Garty and Kristin von Donop describe how to build this movement and use it to overcome resistance that often emerges as the venture starts to grow.
Finally, in Chapter 19, Charles O'Reilly describes the key levers for overcoming silent killers by transforming organizational culture, illustrating this approach with excellent examples of Microsoft's transformation under Satya Nadella.
We could have added a dozen more chapters and still not fully encompassed the issues facing the Corporate Explorer. Even so, this is a comprehensive guide that will serve as an invaluable resource to leaders starting the journey toward building a new venture from inside an existing corporation. We are not offering a prescription from the classroom or a special formula of a management guru. There is no magic bullet for overcoming the very real challenges that confront innovators when they try to move large, successful organizations into new technologies and/or markets. It is painstaking, hard work that carries the day, not application of the latest theory or framework. That this book is based on the lived experience of practitioners gives it an authenticity and value that should be attractive to anyone starting their journey as a Corporate Explorer.
NOTES
1.
A. Binns, C. O'Reilly, and M. Tushman,
Corporate Explorer: How Corporations Beat Startups at the Innovation Game
(Wiley, 2022).
2.
Mike Beer is Cahners‐Rabb Professor of Business Administration, Emeritus at the Harvard Business School.
SECTION ISTRATEGIC AMBITION
CHAPTER 1Strategy Manifesto: Answering the Big “Why”
Andrew Binns and Andreas Brandstetter
A PROBLEM WITH STRATEGY PLANS
Strategy plans often fail at the most basic level. They rarely talk about the big challenges companies face or present a point of view about how to win. Instead of articulating a plan for growing beyond today's business, they often focus on sustaining performance in the present or the near‐term future. When they do talk about the future, it is in vague and aspirational terms that fall short of real commitment. The plan may list possible areas for growth. It may estimate the size of the growth opportunity or, even worse, predict a “hockey stick” trajectory for future revenues when these opportunities are realized. Even when there is a strategy plan with a clear point of view about how to explore and win in emerging markets, that can get lost in a tsunami of PowerPoint slides.
Such plans leave Corporate Explorers confused. A Corporate Explorer is no clearer about the company's aspirations, the impact it wants to have on the world, or where it sees the biggest opportunity for future growth. This makes any aspiring Corporate Explorer wonder: are senior managers committed to innovation? If I spend time developing a proposal, will they want to listen? Should I take my idea to outside funders? The alternative is for the senior team to make a clear statement of the company's strategic ambition in a clearly written strategy manifesto. The manifesto is a document of three to five pages of text that explains the firm's strategic ambition, the implications for the core business strategy, and the opportunity to explore beyond the core. When done well, it is a statement that every member of the senior team can stand behind and explain to their teams. It is the North Star, providing an organization with a clear answer to the “big why” question that informs all other growth and transformation efforts.
The strategy manifesto also gives aspiring innovators a “license to explore.” This is an invitation to managers and employees to develop ideas for how to solve important customer problems within the boundaries defined by the firm's strategic ambitions and hunting zones. It says, “this is what we want to achieve, and we are open to ideas on how we get there.” The strategy manifesto does not replace the detailed analytic work of a strategy plan. It just makes explicit the choices that the company is making with its strategy and provides the rationale for those decisions.
This chapter describes the components of the strategy manifesto, how to create and use it, and what to do if you are a Corporate Explorer in an organization without a clear manifesto. We also include an Application Case Study of how UNIQA Insurance in Vienna developed a strategy manifesto and what role it played in the company's explore business strategy.
COMPONENTS OF A STRATEGY MANIFESTO
A strategy manifesto needs to tell a story that engages its reader and avoids ambiguity. Here is a format that we recommend with suggested word count (Figure 1.1). We provide some examples that are drawn from real strategy manifestos used by companies across many different industries—automotive, semiconductor, and health care—to provide context for how to apply the format.
Context (250–300 words)
The purpose of this section is to acknowledge the past and position the story within the shared experience of the team.
History.
Evoke pride by referencing a shared experience of success. For example,
“As a company, we created the
[insert descriptor]
market and have shaped its success for over 50 years…”
Change.
Recognize the shifting reality in these markets.
“The emergence of digital natives that offer cheaper alternatives has led us to question this future and whether we can compete.”
Question.
Formulate an implicit or explicit “troubling” question to which this document will give the answer. “
Can we be a winner in the next generation of our markets or is defense our only game?”
Answer.
Provide a succinct statement of the senior team's point of view.
“Success is possible if we pursue a strategy of optimizing our current business and exploring into the emerging market, leveraging our assets to move faster than the start‐ups.”
Figure 1.1 Strategy manifesto template.
Challenge (500–600 words)
This section crystalizes the key reasons compelling your company to act now, rather than defer action to another time.
Market Change.
Describe shifts in customer preferences, market dynamics, competitor activity.
“Customers expect more integrated solutions that are easily configurable with software …”
Innovation.
Name the most important technologies or capabilities that could disrupt your markets.
“Electrification of vehicles is a revolution for our industry that changes the product we offer, and the capabilities required to be successful.”
Opportunity.
Explain why the market changes, and innovation is an opportunity for the company. “
Although there are many claiming to have the best new technologies in the market, none can rival our distribution, manufacturing, and sales capabilities. If we can match these to winning customer value propositions, then we can lead the next generation
.”
Threat.
Explain the logic for concern about the emergence of a disruptive threat. This is often suppressed in successful organizations because it may look like disloyalty or a lack of confidence. A manifesto is an opportunity to name the threat that everyone sees.
“Tesla is ahead, we cannot pretend otherwise. They have made themselves synonymous with electric vehicles, despite what we see as inferior build quality.”
Consequences.
Make the potential positive and negative consequences as tangible as possible.
“In the short term, the new market is small in absolute value, representing only 5% of total sales. However, in less than a decade, we anticipate it to be worth double that of our traditional markets. We are either in a position to win an unfair share of this market or we defend an ever‐shrinking market.”
Ambition (300–400 words)
This section presents a big message that inspires teams and helps guide their actions. It should be short, memorable, and provide employees with three key pieces of information.
Emotional hook.
Give people something to believe in that elicits an emotional connection with the company's strategy.
“We want to wage a war on cash, replacing money with digital payments”
(Mastercard).
Logic.
Provide a rationale for the strategic decisions – making a move into digital payments or renewable energy or whatever the opportunity might be. For example, Mastercard got to say “by converting more of the 85% of manual cash transactions to digital,” thereby expanding their market from the head‐to‐head competition with VISA and AMEX for the other 15%.
Aspiration.
Set a tangible goal that is equal to the scale of the opportunity or threat of disruption.
“Only sell emission‐free vehicles by 2035”
(GM); “
Improve the lives of three billion people
” (Philips Healthcare).
Strategic Choices (700–800 words)
This section articulates the “so what” of the ambition.
Core business objectives.
Set specific end goals for what you will achieve in two to three years. “
We will increase market share by x percentage points versus our principal competitors”
;
“We will increase gross margins by two points
.”
Explore hunting zones.
Describe where you see the areas of the greatest potential for the future growth of the business. These “hunting zones” tell aspiring Corporate Explorers where to focus their efforts. See the case study on UNIQA for an example.
Portfolio.
Outline how you will allocate resources across different parts of the business to achieve the ambition. “
We will change our approach to R&D investment so that it is focused on a small set of cross‐business priorities. Some of these are in our core business. Others will be investments in our future business growth
.” This may include highlighting what you are not doing, that is, areas where you are going to withdraw investments, or others that you are deliberately choosing not to enter.
“That means we have made the tough decision to exit business x and y, and to shelve plans for entry into market z.”
Execution (500–600 words)
Here is the section where you describe what it will take to be successful.
People and Culture.
Explain how employees fit in, what they can expect, and how you want them to behave. “
This is a renewal of our organization and its culture, as much as it is of our growth strategy. We aim to create opportunities for teams to demonstrate their passion for customers and demonstrate the entrepreneurial spirit to solve them
.”
Innovation.
Outline the process for managing the flow of ideas into incubation projects. “
We will invite employees to participate in innovation challenges to propose solutions to customer problems within our hunting zones ..
.”
Organization.
Describe any specific organizational units that will be created to manage the growth strategy. “
We will establish a small Emerging Growth Unit responsible for supporting new ventures as they get selected for seed funding. It will collaborate actively with the business units to help our Corporate Explorers leverage the assets they need to succeed
.”
Capabilities.
Give specifics about how you will meet the need for additional capabilities outside the firm's traditional strengths. “
We will appoint a head of software with the remit to hire an additional 100 software engineers within the next six months to professionalize our approach
…”
Next steps (250–300 words)
Be clear about what happens next.
Leader.
Name the leaders responsible for the different aspects of the strategy.
Milestones.
Identify important dates in the next three months that people can watch out for.
Personal action.
Include some immediate actions for the readers of the manifesto. “
Register your interest in participating in the Innovation Challenge at …
”
CREATING A STRATEGY MANIFESTO
Manifestos are short and mostly reflect things that organizations already know, even if they have never put them in this format before. The problem is to tune out the noise of the day‐to‐day business and to crystallize this knowledge into a succinct articulation of what you believe needs to be done. Here are five steps to provide structure to the effort.
Step 1. Develop a point of view.
Start with a point of view about the ambition: What does the organization want to achieve? This could be the “so what?” statement that comes from months of in‐depth analytical strategy work or, as happens to many leaders, an instinctual statement of the potential that lies dormant in the company. This point of view should reflect the company's commitment to positively impact the world and its customers, not just a pious vision statement. A key test question here is: Could this apply to any company other than us? Is it okay if others could set the same ambition? It is
not
okay if the statement is so generic that it could apply to anyone. Another key test is the quality of the emotional response you get from those outside the team – you want people to be excited, a little surprised by the ambition, not confused or uncertain!
Step 2. Assemble facts and perspectives.
The best manifestos come from a disturbing encounter with the outside world that punctuates the usual conversation inside the company. The UNIQA case (see later) describes one technique for achieving this goal. What matters is that this should not be the senior team speaking to itself in an echo chamber. You must be willing to raise troubling questions that the business needs to answer.
Step 3. Create a first draft and iterate.
Someone needs to be the draft leader, who owns the document and creates a high‐quality first draft. That individual should be a good writer who understands the company and its aspirations, so that the language fits the culture and mood. Like a “minimal viable product,” getting an early draft out is a very good way of learning what people really think about the issues in the manifesto.
Step 4. Engage with disagreements.
The problem with most PowerPoint charts is that they leave so much room for interpretation that agreements about the content of a strategy are rarely authentic. Spend time resolving the big issues so that the document reflects a shared plan for action and does not hide disagreements at the top. Writing a manifesto can be emotionally charged. When the authors first collaborated, Andreas (the CEO) was very frustrated with Andrew (the consultant) and his rewriting of the first draft. Andreas felt strong personal ownership of what he had written. It took a few days to accept the challenging feedback that the first draft was not sufficiently precise, and that the new version brought clarity.
Step 5. Adapt for different audiences.
The purpose of the first draft of the manifesto is for the senior team to make sure that there are no areas of ambiguity or unresolved disagreements. Then, it can be adapted for other audiences, of which the most important is the next layer of management in the company. In larger organizations, this is where strategy execution often gets stuck. Middle managers are often focused on achieving narrow product‐line goals and do not naturally think about the overall enterprise context. The manifesto helps to make the context and the company's response explicit to the “sticky middle” of the organization.
INFLUENCER APPROACH
A strategy manifesto is ideally the work of the senior team, be that at the corporate or business unit level. This is where responsibility for the explore strategy should lie, because senior managers are best placed to make the trade‐offs between the short‐term needs of the core business and those of investing in long‐term growth.
However, the reality is most readers of this Fieldbook are not on the senior team, where they could influence the creation of a strategy manifesto. So, what can aspiring Corporate Explorers do to trigger change in their organizations, to tip the balance to the side of investing for the future?
Here are five approaches that work in large, complex organizations. They each take time – many months – and there are no guarantees of success, but ultimately, they can create the sort of bottom‐up pressure that can shift action at the top of an organization.
Approach 1. Outside‐in exploration.
Create a sense of urgency by organizing workshops on “future market trends,” “disruptive forces,” or similar topics that resonate within the organization. Invite external speakers (customers, academics, or ecosystem partners) to present different perspectives on how the world is changing. Or organize “future search” or “scenario planning” workshops, where the objective is to make sense of shared experience of current trends. Use these activities to develop a shared view of the potential futures that current trends might create.
Approach 2. Use executive education.
Enroll Human Resources or learning teams in helping develop a shared view of the future. Anticipating future market trends is a desired leadership attribute at many firms, so you may find willing collaborators who could help shape a conversation about how the firm is positioning itself to lead the next wave of industry growth.
Approach 3. Create a focal point for explorers.
Create a club or interest group about innovation and growth; it could even be a Corporate Explorers Club. Many organizations have such groups, and they can provide a low‐risk mechanism for opening conversation with managers. Handpick your members and then invite senior leaders to come to speak.
Approach 4. Draft your own manifesto.
Write your own version of the company's strategic manifesto. Use a club or one of the exploration meetings described earlier to share your point of view with others, and get their reactions. It is remarkable how quickly such efforts gather momentum and help shift executive action.
Approach 5. Cultivate a sponsor.
