The word entrepreneurship is a scary term to some people who relegate it to a small percentage of the population who are reckless and risk lovers. Not so – it may be more common than one thinks. Even large companies often promote the principles of entrepreneurship, sometimes called intrapreneurship. It is important for them to engage their own employees in entrepreneurial and innovative thinking and action. Without it, they could be forced to go the way of Woolworths, Borders, Blockbuster, Pan Am, Toys ‘R’ Us and a host of other once profitable companies.
Intrapreneurship is a term popularized by Howard Haller, Gifford Pinchott III, and Steve Jobs. Today, several large companies actively promote intrapreneurship within their organization. Google and Intel are well known for allowing employees to spend 10%-20% of their time on innovative ideas of their own. More and more, big companies are aware of their need for innovation and intrapreneurship.
These well-known examples of intrapreneurial success inside of a mega company are representative of many more:
- Mac, iPod, iTunes, iPhone, iCloud inside of Apple
- Gmail, Google News, Google Maps, Driverless Cars, and many other innovations inside of Google
- PlayStation inside of Sony
- Post-It Notes inside of 3M
- SkunkWorks fighter jet inside of Lockheed
- Java programming language inside of Sun Microsystems
- Digital Light Processing inside of Texas Instruments
How does this happen? Employees need to know that it is OK to toy around with new ideas; it is OK to make mistakes and that failure will not be punished. Companies need to hire people who have a wiring for innovation and entrepreneurship and can make decisions on their own.
Patrice Caine, CEO and Chairman of the 65,000 employee French Thales Company, is an example of a person who embraces innovation and entrepreneurship. He suggests that a large company like his and others have much to learn from entrepreneurs, and he states that “…there are two main ways in which large companies can benefit from start-ups’ driving force for innovation and transformation.”
“The first is being inspired and learning from their flexibility, their adaptability, from their trial-and-error culture. With their lean structures and ability to make decisions in a heartbeat, start-ups tend to be more and more responsive to passing opportunities compared to large companies with their demanding, but somewhat painstaking, approval procedures.
Rather than completely overhauling the way they work – a process that, in itself takes time – companies have the option of incubating internal start-ups, preferably with a degree of liberty towards the central hierarchical structure. These can work either on customer projects or on the digital transformation of the company itself, through specific programs or employee training courses for example. That is the spirit of the Thales Digital Factory, located in the WeWork office building in Paris.
Learning from start-ups’ flexibility also means picking-up on their beta -, or Minimum Viable Product (MVP) – culture. Instead of spending a lot of time developing a perfect product, the idea is to deliver a rough draft quickly, that can then be improved with the client and/or end users.
One example of this – even though Google can hardly qualify as a start-up – was Google maps: the first version was just a map, which gradually started incorporating information such as traffic, stores, restaurants, customer opinions, etc. This evolution is interesting because it is part of a global cultural change, with more and more appetite for testing, experimenting, but also for outside insight and collective intelligence.
Working with startups
The second way big companies can benefit from start-ups is by partnering: identifying the most promising start-ups in the field and finding new, interesting ways to work with them.
The ‘identifying’ part can be more challenging than it sounds, with over 300,000 start-ups created in the world every year. How do you find the ten, one hundred, one thousand start-ups that have something new to bring to your industry? It is really up to every company to find the hidden gems where they are in the world… and then to enter into creative partnerships with them.
That is the idea behind Starburst, a start-up accelerator with a focus on aerospace and defense technologies. The success of these new types of partnerships shows how useful they are for all parties: the benefit is obvious for large companies – who can keep their pulse on the latest market evolutions – but also for start-ups, who can test their technologies, be mentored by professionals, and acquire new credibility in their field. 1
IBEC of course works with start-ups, and Mr. Caine’s comments are a reminder to start-ups that they may find their success in partnering with others. What might it take to be “identified” by a larger company as a partner – to their benefit and yours?
Daniel Gunaseelan’s story was told on this site on June 25, 2016. While selling products in the oil and gas industry in western Kazakhstan, he gained valuable experience and made quality contacts for what later developed into the start-up Gateway Ventures. Daniel is a great example of Kingdom, missional living and entrepreneurial focus within an established company. It is worth reading again.
1. Published for the annual event VivaTech. “Innovation: Big companies have so much to learn from Start-ups” by Patrice Caine, May 24, 2018 in Linkedln with the hashtags #VivaTech. #VivaThales
Larry Sharp, Director of Training, IBEC Ventures
larry.sharp@ibecventures.com