Models of production and consumption are changing the world over. New market segments are also opening up due to the availability of broader choice and wallet capacity, driving lifestyle decisions. To this end many startups are emerging across industries either rethinking traditional ways of work or building out entirely new ways to create and present value. These tectonics can happen slowly or come as a short, sharp shock.
Having been part of the startup scene for many years in different capacities, I have noted the transition from the initial David and Goliath narrative where it was the startup entrepreneur and team against the corporate juggernauts in a winner takes all, to one of partnership and collaboration albeit measured and cautious for the most part. The realisation that both the incumbent and startup need each other, especially so in emerging markets where greenfield opportunities would deliver terrific returns on investment on the back of new and stable technology and sometime low regulatory barriers, is refreshing.
That said, the corporate breed needs to break themselves in and understand the innovation process as it has formed and continues to evolve in this new dispensation. For many corporates who may have for years enjoyed comfortable market share, working on new products or services that may be at a slight tangent from their normal is an unnerving experience. The pressure to deliver on targets taking into consideration existing competition and that which is stealth, leads to the adoption of risk-averse short-term strategies by senior executives. The known, becomes a comfort zone that many are unwilling to step out from.
Crafting new value propositions, validating markets and firming up business models require a startup mindset where service pilots and opportunity pivots are executed rapidly with lessons quickly assimilated. Cycling right back till product market fit is achieved, for scale to then become the next agenda.
It is important to have internal champions whose KPI’s are unshackled from the modus operandi. An executive given both the permission and budget to think outside the box is better empowered to deliver longer term value. Analysis paralysis which then becomes corporate rigor mortis needs to be prevented at all costs as no entity is too big to fail or loose a market leadership position.
This flow is important for incumbents to understand as they try to insulate and future-proof themselves, whether through in-house research and development or partnerships with those, often startups, who view the same markets through a different lens.
Njihia is the head of Business and Partnerships at Sure Corporation | www.mbuguanjihia.com | @mbuguanjihia