Picture a contestant on American Idol instructing Bob Dylan on songwriting. Imagine an entry-level production assistant advising George Lucas on Star Wars. The images are a bit ludicrous – the wise masters educated by the upstart students.
In the same vein, many established corporate leaders might scoff at the idea that a green startup company could teach them anything, much less serve as a role model for their business. However, big businesses can learn some important lessons from the startup culture when it comes to innovation, dynamic thinking, and resiliency.
At a recent conference, Jason Williamson, Oracle’s VP of the Startup Ecosystem, spoke with two startup founders to explore the question – how can corporations think more like startups?
Lesson 1: Fail fast, fail forward (within reason)
Startup companies have to be prepared to innovate and to live or die by the results of the decisions they make; they don’t have the luxury of getting too comfortable or relying on the status quo. Each decision made and every moment of hesitation has the capability to directly impact their bottom line and their ability to secure funding for their teams.
As session moderator, Jason Williamson put it, “There’s nothing like having to eat what you kill.” So it’s important to quickly identify what’s working, learn from it and move on.
According to Caroline Barton, founder of fashion startup Modatrova, her idea of failing fast is jumping right in and taking action to determine a project’s merit empirically, rather than theoretically.
“When we come up with a new idea, we don’t really deliberate at all,” Barton said. “We just start out, start doing it, see how it goes. What that allows us to do is realize really quickly what ideas are worth pursuing and which ones we should just immediately abandon.”
In the same way, large corporation leaders can and should seek out growth ideas from within the company and use dedicated innovation teams to push bureaucracy aside and give creative ideas a try. If a corporation’s culture is too concerned about striving for perfection, rather than realizing failure is an essential stepping stone to learning and success, the company can become stagnant and miss out on growth and modernization opportunities.
Lesson 2: Tie innovation to results
But you won’t know if you failed or succeeded unless you have the right metrics and visibility in place. Building a tight bond between the innovation team and its results will help ensure that projects fail fast and fail forward.
By nature, startups have to keep a close eye on their results because when they run out of runway, they’re finished. Corporate leaders may not have these clear financial restrictions, so it’s important to tightly couple the innovation team with the business units. That will give the innovation team a direct line of sight into how their innovative projects are affecting their product lines and the company’s revenue.
Another must-have when it comes to failing fast? Resiliency. According to serial technology entrepreneur and Amplero CEO/Chief Scientist Olly Downs, “you need to have dogged perseverance and persistence and at the same time, be highly adaptable” to handle the failure that is inherently part of the startup approach.
Lesson 3: Build generalists
When you’re in the startup environment, leaders and team members generally wear many hats and are intimately acquainted with each aspect of the business. Corporations can emulate this broad knowledge approach by rotating different executives through the innovation team for a period of time.
Downs advocated transitioning executives back out of innovation team roles when their projects move forward to the implementation phase, stretching them and increasing their understanding of both sides of the business.
“If the project has a successful outcome, the person from the innovation team from the enterprise side goes back in and becomes the business customer and the business unit that buys the [innovation team’s] product,” he suggested.
Lesson 4: Broaden your geographic horizons
Downs grew up near Bristol in a very rural area of England. Staying in his native area, he would never have had the opportunity to build his nine (and counting) startups because the necessary workforce and talent pool wouldn’t have been available.
However, it’s not always the case that you must head straight to Silicon Valley to be able to build a talented and capable team. As Downs emphasized, we live in an era where “technology gets to talent, rather than talent having to get to technology.”
While there will always be hotspots for startups to flourish (Seattle, Silicon Valley, New York City), growing a business is really all about having the right network. Downs shared that working in Seattle, his startup has no trouble finding the technical team members needed for their work on machine learning; where they struggle is in the enterprise sales and marketing arenas, because the same strong development network doesn’t exist in his area for those fields.
Corporations can’t physically pick up their entire business entity and relocate to the latest tech hotspot. However, there is merit in allowing their innovators to do so.
According to Williamson, Oracle has seen great success by allowing their innovative teams to “physically [disconnect] from the mothership.” The physical distance can often create mental separation and freedom as well, allowing the teams to function outside the realm of “muscle memory” and to slough off some of the cumbersome rules required to keep a corporate ship afloat.
Lesson 5: Work together for success
In addition to corporations learning from startups, there are also plenty of opportunities for corporations to work together with startups. For example, Oracle is actively working to add value to its own operations and offerings through an in-house accelerator for startups, including Downs’ and Barton’s.
“These Fortune 1000s – they’re asking the same questions we’re asking ourselves. ‘How do we be innovative?’ ‘How do we move quickly?’” Williamson said, explaining that Oracle is now in a position to create complementary and symbiotic relationships with startups, which then creates a cycle of innovation and success.
Thinking like a startup is less about learning from an inexperienced team and more about taking on the attributes that make startups disruptive, namely their hunger for success through innovation and their agility in navigating market needs. In a digital era where the rule is “disrupt or be disrupted,” getting in touch with your inner entrepreneur may just save your corporation from being eaten by a smaller fish.
Latest posts by Amanda Farmer
- 5 Important Lessons Big Corporations Can Learn from Startups - May 16, 2018