Lean Startup is everywhere. Everybody is talking about “innovating like a startup”. It’s been around for quite a few years now. And people started to realize that it needs some major adjustments.
That's why one of the last big Lean Startup conferences was about how the next generation of Lean Startup should look like.
So how should Lean Startup 2.0 look like? I don't know...
In parallel to the people trying to improve and adapt "innovating like a startup" to a completely new market environment a bunch of new trends are currently popping up.
One of them being the fact that a lot of so-called “Lean Startup Experts” are now moving more towards corporations.
At first it makes a lot of sense.
Lean Startup was inspired by the Lean Manufacturing principles, which were used by Toyota to manufacture their cars. And it also makes a lot of sense from a Lean Startup “expert's” point of view. By the way what's an expert anyways?
So these so called experts move to corporations. Corporations have more money than startups...
But if we take a closer look at corporations and Lean Startup we can see a few critical key characteristics that a lot of corporations usually have ingrained into their DNA.
A DNA that makes a successful implementation of Lean Startup and all other adjacent methodologies almost impossible.
Everyone that ever worked in a large corporation for a few years might be able to underline the complete insanity of trying to implement Lean Startup in corporations.
Trying to get the “innovating like a startup” mindset into the tired, exhausted, underused and overworked heads of employees looks like a Sisyphean task to me.
Now don't get me wrong here. I never read the book The Lean Enterprise or any other book that talks about Lean Startup for corporations.
I just didn't feel like paying $20+ for a Kindle e-book (that's how much it costs). Maybe they cover all of these things. If they do, great! Go ahead and read them...
And I'm also not a Lean Startup expert.
But I've observed a few large corporations (from the inside) and tried to understand how they worked. And if I take a look at the ones I saw so far I'm not sure whether or not the people working there might be the best ones to implement, execute and work with these methodologies.
After all, it's the employees that have to execute the stuff their CEOs (or consultants) tell them. They are the most critical success factor. And to me these people are the true bottle neck.
The ones that stop (and will probably always stop) corporations from innovating like a startup. And you can't really blame them either.
So if you're thinking about sprinkling some Lean Startup (or innovating like a startup) pixie dust into your company think about what' s the actual work mode really like in your company.
And if you don't know what it's currently like, chances are quite high that it might not be in favor of the things you're trying to or thinking about implementing...
And I also know that most people, especially higher management or CEOs won't admit it, but the things I'll be listing down here are unfortunately the truth for many companies. The truth that might ultimately hold your corporation back from innovating like a startup.
So here we go:
#1 Corporations love secrets
There's nothing that corporations love more than secrets.
That's why they have huge legal departments and make you sign contracts that pretty much don't allow you to do anything with the things you're about to learn.
Sometimes you're not even allowed to work for the competitor for the rest of your life.
A lot of companies out there still believe that having an idea for a product and then releasing it to the market will result in success.
The idea is the most critical factor. So they protect it. And keep it a secret.
But we live in a demand driven economy and not a supply driven economy anymore. So ideas are worth nothing.
And most large corporations are just not ready for that paradigm shift. They're still stuck in old ways of looking at the market environment.
Even though a lot of people in higher management positions have recognized this fact, the message can't really be properly communicated down the hierarchy ladder.
Why you may ask? See the next point.
#2 Employees are afraid of making mistakes
Right from the very start of our existence we were trained to not make any mistakes. We were given a script. A script we should follow. A script we have to learn by heart. That's the only way to pass life's exams.
Not following the script will lead to punishment.
You won't graduate, won't get a diploma and then you won't find a job. Not blending in is being punished. That's why we're so afraid of making mistakes. Making mistakes equals punishment. And we don't want to be punished.
And punishment in the corporate world means that you're going to lose your job. You're going to get fired. You won't be able to feed your family anymore. You won't be able to pay that mortgage. So you're going to play it safe. ALWAYS.
Lean Startup on the other hand embraces failure. Well, not exactly failure, but it's more of a trial & error kind of approach. You try something out, see whether or not it works and then adapt it.
And to a lot of people that sounds a lot like making a mistake. Like failure. Like punishment.
#3 Cover your ass attitude (or politics)
The general attitude prevailing in most of the corporations, consultancies and banks is to cover your own ass.
Everything you do or say has to be backed up by numbers or things that make sure that your ass is covered . That you're not saying anything wrong. That you're safe. That your job is safe. That your boss is safe because then you're also safe.
The average employee just doesn't want to get in trouble.
And if you're always trying to cover your own ass you're never ever going to take responsibility. Why should you even take responsibility? So that people can blame you afterwards? No, hell no. But that's exactly what Lean Startup needs if it should be implemented in big corporations.
If no one is willing to take responsibility and implement stuff, nothing will ever happen.
#4 Employees don't trust anyone
Everything we see on TV or read in the newspapers fills us with fear.
Ever since the financial crisis hit, the dominant news are either about people losing their jobs, companies having to shut down, people being replaced by technology, murder, bombings or terrorist attacks.
People generally don't trust anyone anymore. And most importantly employees don't trust their boss's bosses anymore. They might trust their immediate boss but that's not the person making any decisions.
CEOs make decisions. And one day they might say this and then the other day they might say something completely different.
The average employee has seen her trust being betrayed one too many times...
#5 It wasn't me attitude
Being filled with fear and constantly trying to cover your ass will in the mid to long run lead to a "it wasn't me attitude". A “I don't want to be associated with this” kind of attitude. An attitude where no one wants to be held accountable for anything.
An attitude where everybody is just taking care of his own silo. An attitude that limits people's point of view and their thinking. Most people are just stuck in their own silo thinking.
"I do marketing, so I don't care about all the other stuff."
This leads to an environment that can be totally lethal for innovation. An environment where everyone is just following his own script. The safe script.
#6 Employees are driven by something else
Employees are driven by their own scripts. The scripts that are being handed over to them at the beginning of each year. The script that tells them what to do, what to achieve and how they can get as much of their bonuses as possible.
And these are the only people (there might be some exceptions) a corporation can employ. Because the people that are willing to take more risk will seek their luck outside of corporations.
They'll go out, experiment, learn, adapt and tweak their own ideas.
They're the ones being able to innovate like a startup. Outside of corporations. Far away from numerous gatekeepers, naysayers, budget cuts and thick hierarchy layers.
Risk takers might stay at a corporation for a while. Until they saved enough cash to do it on their own. Until they're confident enough...
#7 If an employee would be a risk taker and an innovator she wouldn't be an employee
These days it's easier than ever before in the history of mankind to create your own stuff (and distribute it).
You don't need any programming skills to build a business anymore. You can easily outsource it for dead cheap. Or you can use all kinds of tools. There are tools for almost everything out there.
And if you're a risk taker you won't stay in the cozy corporate environment. You'll go out. You'll start building things. You'll create things. You'll be like Richard Branson telling yourself all the time “Screw it, let's do it”.
#8 A CEO's ivory tower
When a CEO takes a decision (e.g. innovate like a startup) it all might be totally clear to her what should be done, how it should be done and so on. But as a matter of fact most CEOs somehow forgot about the daily struggles of the average employee.
The average employee (the ones executing their strategy) is struggling with a lot of other things. An employee's bandwidth is usually already fully booked with his daily tasks. The daily grind.
They fight for their own survival. They fight their own fights.
And a CEO introducing a new concept, project, tool or whatever will usually not be taken very seriously. The average employee has seen countless CEOs come and go. And they know that this CEO will be gone rather sooner than later.
And with them they've seen their shiny projects come and go...
But even more importantly than all of the above points is the fact that most corporations are just way too afraid to deliver half baked products. Corporations are too afraid to upset and disappoint their already existing customers with half baked products.
And it totally makes sense.
The negative publicity they might get would just kill them. If you're a startup and your first version of a product still kind of sucks it doesn't really matter. If ten people talk shit about you, you don't care.
But if 1 million people talk shit about you, you'll definitely care.
That's why large corporations have an entire department that takes care of PR. That double (or even triple) checks every little piece of content that leaves the corporation's sacred halls.
A (possible) solution?!
I guess the only way corporations could be enabled “to innovate like startups” (and use methodologies such as Lean Startup) is by founding completely separate entities. Entities that are not associated to the mother company at all.
And someone a lot smarter than me told me that that's apparently exactly what Eric Ries is also trying to tell everybody. He calls this stuff “Creating an Innovation Sandbox in the Open” or "Islands of Freedom”.
As this might only work on a theoretical level (because of all the above reasons) I feel that the thing I'm going to describe might be a possible future for all “Lean Startup Consultants, Experts or Agencies” out there.
People, entities or agencies that test and validate products with existing methodologies, such as Lean Startup, Customer Development and the Early Adopter Education Process might be able to solve the problem.
These independent agencies/companies will bring an entire product to market (and try to get product-market fit right) under a different brand, no brand at all or a whitelabel solution.
A product the corporation pretty much tells them to build and then test and validate on the market (with real sales).
And once this entity has achieved product market fit, the mother entity/the client could simply take over the already validated and successful product and release it to their customers under their own brand.
It's some sort of new company builder approach I would say (but as a service for large corporations). A bit like an accelerator, but then again not really...
Now should these agencies or whatever you want to call them be paid per project? Should they get equity? I don't know. But it definitely sounds intereting.
Anyways, if you're a Lean Startup “expert” or someone that's currently facing the problem of not being able to “innovate like a startup”, feel free to get in touch with me to exchange some thoughts (and/or help me understand more of this stuff).
These are just my two cents worth on the entire “innovating like a startup” discussion...
P.S. I'm talking about incumbents here...
Read More: The 25 Rules for Being an Entrepreneur