For corporate managers who wish to spearhead innovative new businesses
within the existing structure, success depends as much on their company’s innovation
environment as on the strength of their business concept. The pivotal environmental
factors are (1) who, if anyone, within the company has primary ownership for
creating new businesses? And (2) Is money dedicated to corporate
entrepreneurship or are new business concepts funded in an ad hoc manner, through
“slush funds”? .
If you work in a company where the early stages of new business conception
are explicitly supported, encouraged, and often strategically channeled, and
which systematically brings these businesses to the attention of top
management, then your company may fit the Enabler model. (If you company’s
approach is more ad-hoc, it’s more likely to be aligned with the Opportunist
Model, discussed in our last posting.
The Enabler Model assumes
that there are ample good ideas around the company and, more importantly, that
there are individuals and teams willing
to flesh them out. Therefore, recruiting and retaining people who have
entrepreneurial dispositions—and who can and want to operate within a large
company—is essential. Executive engagement is also essential if people are to
trust that the company is committed to turning good and proven concepts into
real businesses. Otherwise, project funding can become a casualty of conflicts
with established businesses, or can degenerate into “bowling for dollars”—as an
alternative source of funds for ordinary business unit projects, or for
projects that the company is not particularly serious about.
So what’s your best
approach for working within the Enabler model? First, make sure that top management is truly
committed to the Enabler process.
Senior-level sponsorship is essential to all corporate entrepreneurship
projects, as we highlighted in discussing the opportunist model. Beyond this, take special effort to consider
how your project, if successful, can be integrated with the companies existing
processes and brands. You may have to be
innovative in more dimensions than just technology, product or solution in
order to ultimately successful.
In the most evolved
versions of the Enabler Model, companies provide clear criteria for selecting
which opportunities to pursue, guidelines for applying for funding,
decision-making transparency, and, perhaps above all, well-defined engagement
from senior management. The selection
criteria for project funding can serve as an important expression of corporate
strategic intent. In some cases, there may be significant benefits to mine from
cross-divisional collaboration. In other cases, a company may want to encourage
innovation in the spaces between businesses or by taking divisional
capabilities into entirely new markets. Providing such strategic direction may
deter corporate entrepreneurship in certain business dimensions, but if it is
well designed, it should encourage a critical mass of effort in those areas
that are deemed most important to the company’s future.
Read more from Robert Wolcott and Michael Lippitz on how
corporate entrepreneurs can take their vision to market and help their
companies Grow From Within.
Robert Wolcott and Michael Lippitz are leading authorities
on innovation and corporate entrepreneurship at the Kellogg School of
Management at Northwestern
co-authors of Grow From Within: Mastering
Corporate Entrepreneurship and Innovation (McGraw Hill, 2009). In the past
six years, they have studied more than 30 companies across industry sectors and
developed an ongoing dialogue with them about corporate entrepreneurship
through the Kellogg Innovation Network (KIN).