RocketSpace has developed a four-step methodology for helping companies build more impactful relationships with startup partners: learn, discover, experiment, and partner. This "dating advice" series with Michele McConomy, senior vice president and general manager of corporate innovation services, addresses each step of this process. Previously, she shared tips to help enterprise companies launch pilots with startup partners, faster. In this post, she shares best practices for implementation.
The experimentation stage is often the most challenging part of a startup partnership. No matter how much planning happens in advance, there are always uncertainties that arise. Perhaps a piece of technology takes longer than anticipated to develop—or maybe a product idea is the wrong fit for a particular target market. Both startup and corporate teams need to be agile, responsive, and flexible in order to identify failure points quickly and find less-than-obvious ways to course-correct. Here's how to make execution more smooth:
Optimize Your Procurement Process
Even if you're months away from pursuing your first corporate innovation project, you can still take steps to improve efficiencies. At a bare minimum, you need the right processes to be able to work with startups: You need to be able to approve contracts quickly and have a smooth procurement process. Far too often, corporate innovation teams get bogged down with internal compliance reviews with IT and security teams, for instance. Meanwhile, startups are accustomed to operating fluidly, responding to the needs in the market in near real-time.
Long term, if your startup partnership is successful, you'll want to be able to scale up your operations quickly. By auditing your procurement process now, you'll prevent potential bottlenecks down the line. Think about it: if you have a process that takes six, nine, or 12 months just to get started, what are you going to end up with in the market?
Rely on Expertise From the Outside
Corporate innovation, by definition, introduces new areas of opportunity to established organizations. For this reason, intrapreneurs and their managers will find themselves navigating uncharted terrain.
The resulting ambiguity can be daunting—success-oriented employees may not want to jeopardize their track records. How can businesses encourage their loyal team members to move forward, regardless?
The key is to leverage expertise from the outside. By working with consultants, you can begin to identify patterns in your industry, potentially outsmarting challenges that you would have otherwise needed to learn through trial and error. There is no amount of funding that can help your internal staff gain an external perspective—it's often more efficient to partner with a team of experts who can provide a direct lens.
It's important to think about your corporate innovation project as a series of stages. Along the way, all groups within the partnership—startup or corporate—should expect to push themselves outside of their comfort zones. In addition, every experiment should be measurable and have a milestone that is tangible—regardless of whether the partnership overall is a success.
As one example, RocketSpace recently partnered with an energy management company that was seeking to experiment with new startup partners. This company had its eyes set on a specific set of targets. But after going through the "learn" and "discover" phase with RocketSpace's research and consulting team, they realized that different types of startups might be a better fit.
Rather than choosing partnerships for the sake of "doing innovation," the company is now centering goals around clear deliverables—around product launches, for instance. Meanwhile, they're also evaluating potential startup partners for their unique strengths.
There are three questions that the RocketSpace team recommends for measuring impact at different stages of experimentation:
- What's the end goal that you want to achieve?
- What's the customer's desire?
- What's the impact that you want to make?
As you notice, these questions are not always around immediate revenue and profitability. Especially at the earliest stages of a business experiment, ROI is in the eye of the beholder. Corporate innovation initiatives need breathing room to provide their full value. When it comes to being outcome-oriented, remember that failure can be a sign of success, too.
Looking for tips and best practices to structure your corporate innovation experiments and startup partnerships? Get in touch with RocketSpace's research and consulting services team. We're happy to share best practices and patterns that we're observing across corporate innovation teams like yours.
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