Winning is today about Innovation rather than efficiency or capital. Innovation trumps Capital, Scale or Efficiency. Innovative companies will survive and thrive. Companies that do not innovate will die. We all understand and accept that.
Innovation is Still a Black Art
Innovation is Still a Black Art
The problem however is that innovation is still a messy, accidental process with no playbook or proven methodologies, not even to recognize a good idea if discovered. We have all heard numerous stories of innovative ideas ignored, or worse, actively killed in large enterprises. Big companies are designed for stability and execution, not innovation. They are the victims of their own success at managing efficiently – which requires predictable outcomes, efficiency and eliminating mistakes -- the very anathema of innovation.
Most companies do not know how to create new innovation, or even recognize an innovative idea. They just do not have the DNA. They have to outsource or acquire innovation.
Startups are the only Reliable source of innovation
The best source of innovation is the startup ecosystem. Startups align incentives for entrepreneurs with the right personality traits, enable experimentation by making failure acceptable, and encapsulate and limit the risk that larger enterprises cannot afford.
Large companies have always partnered with the startup ecosystem to innovate. Models include venture investments to more open innovation models such as partnering with incubators, incubating ventures directly, and inviting startups to work with the business. You need to partner, collaborate, and eventually acquire startups who successfully refine, prove and scale a desired innovation.
Is there a Reliable process to engage with Startups?
The core problem of reliability still remains. How do you know you have explored what the startup ecosystem has to offer? It is like trying to explore the internet without a search engine – you would be limited to what you know or are referred by accident – hardly a satisfying process.
Corporate management exposure to the startup ecosystem is accidental and sporadic. Startups are messy and volatile, and there was no systematic way to find, assess and engage with startups, there was no search engine to help you discover and rate relevant startups – till now.
IPO, or Innovation Process Outsourcing
Of course, you need more than a mere search engine. Discovery alone creates a list of startups without a sense of relevance. Startups do not fit a standard template (unlike websites and HTML). You need a curation and engagement platform and process. Startups are not commodities you just consume, they are living, evolving organizations you need to fit with. You need to co-create and co-evolve. You need a platform to discover, assess and engage even before you decide to work closely with the startup.
A new emerging category of platform-based service providers is addressing this need. I call this Innovation Process Outsourcing, or IPO. These platforms provide a systematic process to discover and engage with startups. IPO turns a messy, accidental, irregular practice into a systematic process you know how to manage well.
Just like BPO converts a poorly managed non-core function for the client into an efficient, structured managed service by handing it to someone with a core-competence in the function, IPO converts innovation from a poorly understood, accidentally-managed function to a managed service by handing it to specialist platforms and start-ups.
IncubateHub is one such platform. They help companies partner with and leverage the innovation ecosystem as a managed service.
IPO is the Future
Innovation Process Outsourcing Platforms maximize discovery and access to innovative startups, and structure the assessment process leveraging internal & external expertise. You can engage with the platform in multiple ways:
· Get solutions to specific problems you have already identified;
· Elicit use cases of specific technologies within your industry or function; and
· Source, co-evolve and develop new ideas
As a side benefit, your employees will get exposed to the startup culture, ideas and energy, maybe helping your organization become more agile and innovative.
We believe that IPO Platforms will foster much higher levels of engagement between the corporate and startup ecosystems leading to higher economic benefits of innovation