Corporations today have to innovate to stay relevant. Understanding this, many global corporations run internal programs and initiatives. However, these tend to be incremental innovations, which are important but not game-changing.
To achieve more ambitious innovation goals, large organisations must have the right talent, an innovation-centric culture, and the necessary enablers and processes to fulfil these aspirations.
Startups, on the other hand, have the single-minded goal to solve specific problems through constant technological innovation. This razor-sharp focus, strong internal team alignment, and agile development allow startups to innovate with speed.
There is, therefore, a compelling reason for corporates to work with startups to co-innovate.
Consider the power dynamics between corporations and startups
On one hand, we have the corporation’s ability and vast resources to achieve scale, and on the other hand, we have the startup’s ability to create rapid and value-creating disruptions.
While they usually view each other as David and Goliath, there exists a synergy between them and they should explore collaboration. A structured program could extract most of the innovation potential through this collaboration.
Start from the top
The proverbial top-down approach is extremely crucial to percolate the vision down from the corporate leadership to the rest of the organisation. Carefully-designed programs involving the leadership and relevant business units will help craft the vision better and achieve the desired outcomes. The corporate could work with partners that are able to facilitate the co-innovation process.
It begins with an independent innovation audit to identify gaps that need to be addressed. Those gaps must be aligned with the corporate vision and strategy, thereby maximizing strategic impact. The corporate must then embark on the process of clearly defining the problem statements and gaps.
Three phases of corporate-startup collaboration programs
The program for such corporate-startup collaboration typically has three phases: design, build and operate.
At the design phase, it’s important to plan for internal resources such as budget, staff, infrastructure, operating model, legal documentation, and governance mechanisms, as well as external resources such as mentors and other industry partners.
During the build phase, key staff members are inducted into the program who will build and detail the program aspects such as using case creation, startup sourcing process, and relevant marketing efforts.
During the operating phase, the designed plan is executed along with the startup cohort. Some programs conduct carefully-curated business interventions that are aligned with specific business gaps. Periodic audits and reviews are required to assess the cohort’s progress and administer necessary course corrections to the program.
Good communication is key
Communication – both internal and external – is key to the program success. For the corporate that is engaging the startup ecosystem for the first time, it is crucial for the leadership to pay attention to communication.
Positive reinforcement after every success during the program helps everyone to rally around the new process of collaborative innovation. Portraying the appropriate public image is also necessary to attract the right startups and partners.
As this article is not meant to be an exhaustive list of the ingredients for a successful corporate-startup collaboration, these three ingredients have been identified as most essential.
Singapore offers a good location for co-innovation
Singapore is the gateway to the rapidly developing Southeast Asia region, with a population of more than 600 million people that is relatively young. Furthermore, the startup ecosystem in Singapore is ranked highly, with more than 150 VCs and over 100 accelerators and incubators on this tiny island.
In addition, Singapore has more than 5000 MNCs that have set up an office here and a number of them are involved in co-innovation. Enterprise Singapore supports the ecosystem through its Startup SG initiatives.
In 2018, L’Oreal launched the L’Oréal Innovation Runway, a partner competition with SLINGSHOT, a global startup competition. As a SLINGSHOT judge, L’Oreal was exposed to the many startups that took part in the competition and was able to pick out interesting startups to work with. They also piloted a co-innovation programme to work with startups based in Singapore.
Home-grown ST Engineering launched an engineering-based incubator, Innosparks, that aims to address needs in mobility, energy, and healthcare. It provides startups with up to S$500,000 (US$369,000) in funding, co-working space and includes access to ST Engineering’s expertise and networks.
With an increasing number of exciting and innovative startups in the region, a track record of corporate innovation, and the availability of partners who understand how to run co-innovation in Singapore, companies can consider Singapore as a strong base for such collaboration.
About Lim Seow Hui:
Armed with Bachelor in Electrical Engineering from NUS and a stint in the Human Resources industry, Ms. Lim Seow Hui joined SPRING Singapore’s Industry Development Group in 2008 where she managed key SME accounts in the Electronics & Printing Industries. In 2011, she went on to head a team in the Planning Unit where she represented Singapore at international fora on SME-related policies development such as ASEAN and APEC SME Workgroups. Seow Hui is now the Director of Enterprise Singapore’s Startup Division where she works closely with partners from the startup ecosystem to further strengthen the community.
About Prasad Vanga:
Prasad Vanga is the founder & CEO of Anthill Ventures, a speed scaling platform for early growth stage startups. Within four years, Anthill has built a startup portfolio of 30 companies across India, US and SE Asia that has grown by 3X in portfolio value. In his current role, Prasad leads the strategy, fund management and venture building at Anthill. Prasad has over 18 years of experience in helping senior executives from large organizations like Symantec, Nike, Nestle, Novartis, Wachovia, HSBC, and YES Bank to drive business transformations. His expertise is to help senior leaders discover the core competence of their organizations and design a change management framework that allows them to leverage their culture to drive large transformations. Prasad also has the experience of an Entrepreneur who built a $25M company within 3 years and as an Investor, he has backed several successful companies like Medplus, Zenoti, and Tynker which provided exits of >12X.
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