Established corporations face an innovation imperative - disrupt or be disrupted. Yet transforming rigid bureaucratic cultures into hotbeds of entrepreneurship can seem daunting.
Where do you start?
By infusing the same practices that prove successful in agile startups, such as new venture incubation, design sprints, pitch competitions, and external partnerships.
We see this manifest through pioneering corporate programs such as Google X's "Moonshot Factory", Samsung NEXT's early-stage venture fund, and Intuit's "Innovation Catalyst" team spearheading small business fintech concepts. Industry leaders recognize catalyzing internal entrepreneurship as mission-critical to sustaining relevance amidst market turmoil. Consumer giants like P&G drive consistent growth through business within businesses like Tide Spin, Bounty Duratowel, and other ventures forged by internal "corporate entrepreneurs". Lockheed Martin does this by allowing Skunk Works engineers to rapidly build classified aircraft prototypes in small autonomous teams.
But lip service is not enough – you must provide structural programs giving employees authority to operate like founders. The rewards for commitment are evident: new offerings and business models unlock value once trapped by status quo models. If you are prepared to support internal venturing, a vast landscape of untapped potential awaits.
Here are 5 recommendations for your company to adopt entrepreneurial practices that drive innovation:
1. Create Internal Funding Channels
Establish internal fund mechanisms to finance and incubate experimental employee-led startups. Support teams to rapidly iterate concepts focused on strategic growth areas or disruptive models.
Establishing internal funds and incubators to finance experimental employee ventures enables corporations like Google, Comcast and Cardinal Health to nurture innovations. Google provides Engineers with high levels of autonomy to devote time to passion projects that could deliver the next billion-user platform - structurally enabling the incubation of Gmail, Google Maps, AdSense and more internally. Meanwhile, Comcast's LIFT Labs incubator gave life to their smart home service, Xfinity Home. By resourcing a dedicated team to rapidly iterate, LIFT Labs helped this concept traverse the constraints of the parent organization’s legacy processes to now reach millions of subscribers. Similarly, pharmaceutical giant Cardinal Health's venture fund seeds concepts that disrupt mainstays of the current $150 billion medical distribution market they lead. Offering startup-style support clears pathways for internal teams with promising models to secure leadership endorsement for commercialization.
Structured funds, dedicated talent and autonomous governance give corporate entrepreneurs latitude to pursue ventures aligned with strategic roadmaps. Parent companies reap rewards when these ventures pivot into breakthrough offerings reaching new segments or establishing parallel business tracks. With the blueprint laid out by peers, more leading organizations now stand ready to incubate market-shaping innovation internally.
2. Establish Interdisciplinary Innovation Labs
Create cross-functional Innovation or Emerging Tech labs focused on building minimum viable products that prove the applicability of emerging technologies like blockchain, AI and spatial computing.
Many leading companies now house dedicated Innovation Labs to build minimum viable products (MVPs) validating emerging technologies’ business applicability. For example, Boeing HorizonX Labs rapid prototype use cases for augmented reality, artificial intelligence and analytics - establishing internal expertise on frontier tech applications while informing future external startup investments. Meanwhile, Mastercard Labs serves as an internal consultancy guiding business units on designing proof of concepts powered by blockchain, AI, quantum computing and Internet of Things capabilities. They speed commercialization by leveraging learnings across efforts enterprise-wide. Additionally, Lowe's Innovation Labs provide access to 3D printing, robotics, and augmented reality systems - empowering retail employees closest to customer needs to pioneer experiential store concepts, bridging digital and physical approaches.
By resourcing labs to experiment with leading-edge capabilities in compressed cycles, corporations can both build future-proof skills and conceive next-generation offerings. Programs spanning consultant teams, open access prototyping zones, to structured rapid MVP sprints produce hard evidence of emerging tech relevance far faster than traditional R&D processes. With exponential technology change, dedicated innovation labs help shift organizational mindsets from reactive to proactive.
3. Execute Rapid Design Sprints
Implement fast-paced design sprints that empower small squads with investment to intensely workshop and prototype new products or features in compressed 1-2 week frameworks.
Implementing fast-paced design sprints has become a prevalent strategy for fostering innovation and expediting product development across various corporations. One notable example is Google, which pioneered the concept of design sprints and continues to use them to iterate on their products rapidly. Google's design sprints involve bringing together cross-functional teams for a focused and time-limited period, typically five days, to ideate, prototype, and test new concepts. This approach allows them to efficiently address design challenges and generate user feedback early in the development process.
Similarly, Apple is renowned for its commitment to design excellence, and it often employs a variation of design sprints to streamline product development. Apple's design teams engage in intensive collaborative sessions to iterate on hardware and software features, ensuring a seamless and user-friendly experience for their customers. The company's dedication to design thinking is evident in the iterative process used during the development of products such as iPhones, iPads, and MacBooks.
In the automotive industry, Tesla has embraced the concept of design sprints to accelerate advancements in electric vehicle technology. Tesla's teams engage in rapid prototyping and testing, allowing them to bring cutting-edge features and improvements to their vehicles in short timeframes. This agile approach to product development has contributed to Tesla's success in pushing the boundaries of innovation within the automotive sector.
Microsoft has adopted design sprints to enhance the user experience and functionality of its products. Microsoft's design teams utilize sprint methodologies to quickly iterate on software interfaces, ensuring that their products meet the evolving needs of users. This approach has been particularly evident in the development of operating systems like Windows 10, where Microsoft has embraced iterative design sprints to introduce new features and refine existing ones based on user feedback.
The implementation of fast-paced design sprints has proven to be a versatile and effective strategy for various corporations across different industries, fostering a culture of innovation and rapid product development. This approach empowers small squads within these organizations to collaborate intensively, leading to the timely creation of high-quality prototypes and innovative features.
4. Introduce Employee Pitch Competitions
Launch shark tank-style pitch events where employees can present ideas to executive judging panels for seed funding, resources, and leadership support to develop concepts addressing customer pain points or strategic priorities.
Introducing shark tank-style pitch events has become a dynamic approach for corporations seeking to tap into the creative potential of their workforce and catalyze innovative solutions. One notable instance is Amazon, which organizes internal pitch events resembling the popular TV show. Employees across various departments pitch their ideas to executive panels, vying for seed funding, resources, and leadership support. This initiative has led to the development of successful projects within Amazon, such as the creation of the Kindle e-reader and the Amazon Go cashierless stores. By leveraging the insights and ingenuity of their employees through internal pitch events, Amazon has cultivated a culture of innovation that aligns with customer needs and strategic objectives.
Similarly, IBM has embraced the concept of internal pitch events to drive innovation within the organization. The company hosts innovation jams, where employees present their ideas for new technologies, services, or process improvements. These events provide a platform for IBM employees worldwide to collaborate, share insights, and receive support from leadership to turn their concepts into reality. IBM's commitment to fostering innovation through internal pitch events has resulted in the development of groundbreaking solutions, including advancements in artificial intelligence and cloud computing.
In the technology sector, Microsoft has also implemented a similar approach by organizing hackathons and pitch events. These events encourage employees to present their ideas for addressing customer pain points or advancing strategic priorities. Microsoft's One Week hackathon, for instance, brings together employees globally to collaborate on projects ranging from accessibility solutions to environmental sustainability. Successful pitches from these events receive not only seed funding but also the necessary resources and leadership guidance to transform ideas into impactful products and services.
The financial services industry has witnessed the adoption of this strategy by companies like JPMorgan Chase. The firm hosts an annual innovation week where employees can pitch their ideas for enhancing customer experiences, streamlining internal processes, or addressing industry challenges. This initiative has proven instrumental in fostering a culture of intrapreneurship, leading to the development of innovative financial solutions and digital platforms.
The implementation of shark tank-style pitch events has gained traction across diverse industries, serving as a catalyst for innovation within corporations. By providing a platform for employees to present their ideas and secure support from executive judging panels, companies foster a culture of creativity, entrepreneurship, and problem-solving, resulting in the development of groundbreaking solutions and strategic advancements.
5. Foster Collaboration with Innovation Partners
Cultivate partnerships with academic institutions, incubators and accelerators which their employees can embed within to immerse in external entrepreneurial cultures and tap ecosystem support in launching new ventures. Corporate teams can pilot concepts with these partners and selectively acquire them.
Fostering collaboration with academic institutions, incubators, and accelerators has emerged as a strategic initiative for corporations aiming to infuse entrepreneurial spirit into their organizational DNA and leverage external innovation ecosystems. One prominent example of this collaborative approach is seen in the partnership between Google and academic institutions like Stanford University. Google collaborates with Stanford's Center for Professional Development to offer employees the opportunity to enroll in courses that immerse them in cutting-edge technologies and entrepreneurial methodologies. This partnership not only enhances the skill sets of Google employees but also facilitates the cross-pollination of ideas between academia and the corporate world.
In the automotive industry, General Motors (GM) has established partnerships with various accelerators and incubators to tap into emerging technologies and business models. By embedding GM teams within these external ecosystems, employees gain exposure to diverse entrepreneurial cultures and can collaborate with startups to pilot innovative concepts. This collaborative approach allows GM to stay at the forefront of advancements in electric vehicles, autonomous driving, and mobility solutions. In some cases, GM has selectively acquired startups that have demonstrated promising innovations during these collaborations, ensuring the integration of entrepreneurial talent and cutting-edge technologies into their corporate strategy.
Pharmaceutical giant Pfizer has embraced partnerships with academic institutions and incubators to drive innovation in the healthcare sector. Pfizer Labs, the company's innovation arm, collaborates with leading universities and incubators to provide a platform for employees to immerse themselves in external entrepreneurial cultures. Through these partnerships, Pfizer explores new healthcare solutions, such as digital therapeutics and personalized medicine, by piloting concepts with startups and academic collaborators. This not only accelerates the pace of innovation within Pfizer but also positions the company at the forefront of transformative advancements in the healthcare industry.
In the technology sector, Microsoft has strategically partnered with accelerators and incubators worldwide, allowing its employees to embed within these ecosystems. Microsoft's involvement in programs like the Microsoft for Startups initiative provides employees with the opportunity to collaborate with innovative startups, gaining insights into emerging technologies and market trends. This engagement enables Microsoft to pilot and test new concepts in collaboration with external partners, fostering a dynamic and agile approach to product development.
Corporations actively cultivating partnerships with academic institutions, incubators, and accelerators exemplify a commitment to embracing external entrepreneurial cultures and tapping into diverse innovation ecosystems. These collaborations empower employees to stay at the forefront of industry trends and also facilitate the seamless integration of external innovations into corporate strategies, ultimately driving sustained growth and competitiveness in today's rapidly evolving business landscape.
In conclusion, your company can benefit from start-up practices through funding mechanisms, structured programs and partnerships. This infuses innovative thinking and urgency into your organization to drive productive experimentation and next-generation offerings, balancing ongoing incremental improvements with bolder and new offerings that address disrupting or underserved markets.