What it takes to successfully Spin-Off from a Corporation?
Probably is more about the right perspective than the right resources…
Dear Fellow Innovator,
Since Prof. Christensen has published his books, “Disruptive Innovation” is a word that disturbs the nights of many business men.
Take a look at what a company like Amazon is doing to the retail industry, or Uber is doing to the Taxi industry. Entire chunks of GDP are affected by Disruptive Innovation.
These poor guys and ladies feel disarmed against something that they deem unpredictable and dramatically fast. The speed at which digital business rump-up makes change the rules of game overnight and waste hardware investments built in decades.
But what it really amazes me is not: “Disruptive Innovation”.
It is thinking to the incredible amount of innovation that is daily wasted in the research centers of those established business.
Think for a moment to Percy Spencer, the inventor of the microwave oven. In 1940s he was studying microwaves at Raytheon (the company was producing radars for the US Department of Defense) when he noticed that a chocolate bar in his pocket was melting.
In a normal company, this would have been classified as “an annoying defect” of the radar performance and subject to a “cure” to minimize or eliminate it.
In Raytheon this “side effect” was studied, and patented.
In 1947 Raytheon put on the market the first microwave oven, today a cannot miss of any kitchen.
But how many “inventions” are lucky like this? The reality is that every day, the same Company scared to death by Disruptive Innovation, throws away dozen of inventions that can become innovations.
This, I believe, is one of the greatest waste of today’s time.
One of the main reason it happens is a lack of Entrepreneurial Culture within Corporations. That Spirit that allows a person take risks, try & error, fail and resurrect until innovation happen.
But it is not a fault, as some “innovation’s expert” tend to say. It is simply the result of a process that rewards the ability of the company’s management to refine a known business model.
Company’s management uses decades of sound business management practices to “filter-in” the best ideas to beat the competition, along a known technology trajectory, while they “filter–out” all those ideas that may take the company away from the trajectory, almost surely reducing its ability to exceed competition’s performance and gain the favor of the Clients (and their money).
The Entrepreneurial spirit, the same that has boosted the early days of the corporation, is necessary when a business model has still to be found and until it is consolidated along a technological trajectory.
Starting from this consideration, there is, probably, a way to save the “innovation waste”.
Corporations need to inject a bit of that Entrepreneurial culture that is making its route from Silicon Valley all over the world: the Lean Start-up movement.
Doing like some of the largest corporations, like the airplane maker Airbus and General Electric, do: embracing lean start-up methodology and building start-up labs in their premises.
Unfortunately, while they do so, they are still biased toward the “more performance” mantra. Their idea is to build a lab and inject entrepreneurial culture in order to improve along the original trajectory, or shelter against nascent disruptive innovations that are difficult to detect from within the walls of a corporation.
But this probably will not work.
Instead, the purpose of a Corporate lab, in my opinion, should be to receive from the Corporation Research Center all the “not-aligned” inventions, to be tested and helped to find the right Customer.
A Corporate Lab, in other words, should not have as a goal to bring more competitive advantage to the mainstream trajectory, but to be a nest where not-aligned inventions can grow feathers and start a new technological trajectory as a Spin-Off.
with this different perspective a Corporate Lab should give a totally different spin to the efforts of its parent R&D department, stop being in competition, seen as the potential disruptor, and starting to be seen as the Future.