In 1920, the lifespan of a Standard and Poors Top 500 company was 67 years. By 2010, that had dropped to just 15 years. And by 2013, corporate lifespans had deteriorated below 10 years. By any measure a pandemic. Very simply, when the rate of change outside a corporation exceeds the rate of change inside an organization, chances of survival diminish.
While most companies talk about the need for an innovation culture, the reality is we need an adaptation culture. We need some people pushing boundaries with innovation. Equally we need people focused on core execution. Re-engineering a plane in flight requires balance. Ying and Yang. Universally, we need to have an organization prepared to adapt to changing customer demands and innovation opportunities.
Intrapreneurs face onerous challenges. Surrounded by resource, corporations are forever resource constrained. The challenge in innovation is as much to kill as it is to create. To be able to refocus resource from platforms in decline to platforms in demand. In the words of Warren Buffett, “The power of simple math is often ignored by companies to the detriment of their shareholders”. In one institution I observed we were spending seven times more on platforms in decline than platforms in demand. Simply, we were failing to invest in what customers value. In those terms, it is easy to see why the world’s leading corporations are failing faster than ever before.
Success has it’s own inertia and can be your greatest enemy. The momentum of success is perhaps the hardest challenge for an intrapreneur to overcome. With crisis comes commitment. But the absence of a crisis creates a conundrum. Why change something that is working well? Not everyone sees what you see. So I’ve developed a simple formula for change over the years. ICE. Inspire, Collaborate and Execute.
Inspire is about providing the organization context. Context that defines the call to action. An ‘outside in’ approach of starting with the customer and looking across industries for best in class customer centric transformation. Developing an ecosystem of expertise from Government, Universities, Entrepreneurs and giving voice to change leaders within. For reasons difficult to understand, voices from outside resonate more loudly than those from within. But your change leaders are your catalysts for transformation.
Collaborate is to enable the ecosystem to function. Building capabilities to support initiatives. Skills such as Design, Agile Development and Lean Management. It is important to light fires across the organization using your champions as catalysts. Nothing is more powerful than aligning a team. Doing the right thing, the right way with the right people.
Execute is simply about focus. Identifying the one critical pivot point that will contribute to your current core but over time transform your business model. History across many industries has shown, transformation at the core often meets too much resistance to succeed. Transforming an adjacency or creating your own competitor has a higher probability of success.
Intrapreneurs have what Entrepreneurs crave. Capital and resource. But the constraints around capital and resource within the corporation often make that advantage difficult to attain. The consistent advantage intrapreneurs have is access to brilliant minds. Internally and externally. As the world changes to more collaborative ecosystems, the lines between intrapreneurialism and entrepreneurialism will become less defined. But the imperative to change will grow stronger. To paraphrase Charles Darwin, it’s not the biggest or the strongest corporations that will survive, but the ones most adaptive to change.