One of the biggest advantages of building a corporate startup is having access to the abundance of resources and technical know-how that a typical startup would not have access to. Yet, we often see companies do not have a clear policy for how innovation teams can leverage key assets within the core business.
For example, access to customers, access to the brand, access to operational functions such as legal, procurement. Without a clear guideline of how innovation teams can leverage these resources, these teams in large companies are basically ‘startups in chains’. They don’t have the benefits of a large company, nor are they able to do whatever they want like a solo entrepreneur. This is why it's extremely difficult for corporate innovation to succeed without collaboration and support from the core business. And why a bridge to the core is crucial to corporate startups success.
Why a bridge to the core matters
A bridge to the core really matters when it’s time for an innovation project to scale. Sometimes an innovation team can work on ideas in isolation but when it is ready to transfer its business model from Explore to Exploit phase, it requires a large amount of resources. The advantage of large companies over startups is that they have a large customer base, loads of resources, and a powerful trusted brand. Without access to these assets, it is very difficult for innovation projects to scale. We have worked with an FMCG multinational, where an innovation project was ready to scale. Multiple experiments had shown consumers were five times more likely to purchase the product if an existing trusted brand was used. However, the innovation team was not approved to use the brand and unable to gain enough traction to continue the project.
Stuck In the middle of nowhere
In such circumstances, corporate innovators have even more constraints being placed upon them than solo entrepreneurs. Additionally, they may not have the same incentives as a startup, and overtime will be less motivated to keep driving the project further. Often stuck in the middle of nowhere. This is why building a bridge to the core is important to allow projects the best chance of success.
If there is no clear bridge to the core, a lack of access to resources can become a real barrier. We often describe it as ‘the problem of success’, once the innovation team becomes successful, the core business actually does not know what to do with it. This results in innovation teams being in perpetual pilot phase, without the ability to scale and grow.
The Chief Internal Ambassador
One way to build that bridge is to assign a Chief Internal Ambassador in the organization. The Chief Internal Ambassador is a trusted person with clout who knows everything going on on both the Explore and Exploit sides of the company. The Chief Internal Ambassador and his/her team know all of the resources, activities, and patents that exist in the execution arm of the organization. They also have the trust of the powerful people that manage those resources.
The Chief Internal Ambassador makes sure innovation teams can benefit from the strengths of the existing company by negotiating access to elements like clients, the salesforce, the brand, the supply chain, and other skills and knowledge. The Chief Internal Ambassador establishes and maintains a collaborative partnership between existing businesses and innovation teams.
This article is an adapted excerpt from our latest book
The Invincible Company