In times of economic turbulence, companies often react by circling the wagons and becoming more conservative with how they invest and spend. While it's too soon to tell how the market will react in the long run to the global economic uncertainty brought on by Brexit and the new U.S. administration, there are a number of ways that corporations can thrive in this environment. Through partnerships with startups, corporations can discover inefficiencies and potential areas of growth, leading to new products and services that can help weather uncertainty.
To do this successfully, corporate innovation teams must align with their executive teams around the impact and value of partnering with startups. Doing this has long been a challenge because the outcome of a project — or lack thereof — is hard to measure. The timelines for innovation projects are typically long, and the results are nearly impossible to measure using the financial metrics that businesses are accustomed to. To succeed, corporate innovation teams need to overcome these challenges — and the best way to do this is by developing strong internal relationships.
Here are three ways corporate innovation teams can get started with forging the right relationships with startup partners.
1. Create Strong Internal Partnerships
To support external partnerships with startups, corporations need to build an internal culture that's committed to intrapreneurial processes.
The right internal partnerships — between management and executive team layers — are especially important for helping intrapreneurs gain buy-in and support from the rest of their organizations. Coming up with new solutions and products isn't enough — to make an impact, those products and solutions must eventually be adopted by the broader company. For an innovation team to be successful, they need to market both the team and the team's work internally. This internal marketing makes it easier for other employees to understand how they can support the team's mission — and how doing so will help the company differentiate and grow. This will also smooth the often rocky path for getting stakeholder buy-in.
When corporate intrapreneurs work in a silo, even with the support of external coaching programs and dedicated financial resources, they can potentially hurt their own effectiveness. To avoid this, it's crucial to have a point person on the innovation team who can own relationships with internal stakeholders and bring them into brainstorms and meetings so they can weigh in on decisions that will impact the overall arch of the program.
With strong foundations in place, corporate innovation teams and entrepreneurs will be well-positioned to initiate experimental partnerships with startups.
2. Align Every External Partnership to a Longer-Term R&D Plan
It's crucial for intrapreneurs to make sure that they're on the same page with the organization's goals at every step of the corporate innovation journey. This alignment ensures that any partnership they build will be mutually beneficial for both parties in the long run. If they partner with a startup that's able to develop a strong proof-of-concept, both parties need to understand what the endgame will be if it goes well. For investing, acquisition or a joint venture to happen, both the corporation and the startup need to understand the end goals up front. Then the startup will be able to understand what the next steps will be and look to those for motivation.
For example, RocketSpace's corporate accelerator collaborators make a point of setting very specific goals for their innovation models. All parties aim to iterate upon experimental outcomes to improve their internal processes as well as the services they provide customers and partners. As one example, in RocketSpace's Logistics Tech Accelerator a corporate collaborator and startup came together in the program to develop a track-and-trace solution for shipping logistics that resulted in a joint venture. Because they were clear about their goals from the start, both parties benefited from the joint venture and they successfully commercialized the solution.
3. Collaborate With Like-Minded Startups and Corporate Partners
Values and interpersonal dynamics play an important role in inspiring successful partnership outcomes. With multiple teams working in tandem, a strong cultural fit needs to exist with corporate sponsors and a startup's founding team.
Successful long-term partnerships require patience, iteration, and practice. Without a positive attitude and a shared set of customer objectives, the pursuit of mutually beneficial results will be an uphill battle. Ultimately, both parties need to strive to fairly structure a license or commercialization partnership, or white labeling, or joint venture. After that, they'll have to be able to collaborate on releasing a pilot and then the final product. When teams are able to come together successfully to do this, it can be a very process rewarding for both parties.
Looking for Guidance?
When forming a team of external partners — with corporations and startups that have similar business interests — the process of finding a common goal, launching an experiment, or breaking ground on a new initiative may feel daunting. The right external partner can help you implement the right processes.
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