Friday, January 30, 2009

"How Big Companies Kill Innovation" by Eduardo Sciammarella

Eduardo Sciammarella, Founder and CEO of Protomobl, has good post here.

The classic challenge inside large companies is for the business units to think beyond the coming quarter, next model or feature. While they race to capture the revenue stream that exists today, new entrants disrupt the market. Often, companies will have R&D groups that are flush with innovative ideas but completely disconnected from the business units. One of the ways to overcome this is to have the R&D group and the business unit agree on a time frame and a shared vision. The R&D group can then go off and execute in line with that vision, with the business unit's buy-in. This is important inside a large company - but buy-in alone does not equate with successful innovation.

The challenge outside is different. Sometimes, large companies approach small start-ups to see how they can benefit from each other. This can be a very risky proposition for a start-up. You must be hyper aware of the fact that everything is going to take much longer than you anticipate. Alternatively, large companies should be very careful about engaging small start-ups. If you are a large company thinking about approaching a start-up, make sure you have a clear goal with a set time-line and budget on hand. If you don't have all these things, please don't waste their time. Time is the life-blood of a start-up...

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