- Innovation Family Planning. Defining the right balance in your innovation portfolio between existing and new business
- Organizing the innovation family. Implement the right set-up and way of working required for the whole family as well as for the individual members
- Business Model Innovation. Create new dynamic business models showing the rationale of how your business creates, delivers, and captures value
- Accelerating new business. Survive puberty by co-creating the market and scaling your business together with partners
- Business Validation. Use a venture development framework to evaluate your innovation family as well as the individual members
- Think & Act as Entrepreneurs. Use a set of decision-making principles, used by entrepreneurs to rapidly sense, act and mobilize in situations of uncertainty (effectuation)
- Innovation performance management. Have a performance management system in place that is tuned to the specific needs of the different innovation family members
- The entrepreneurial toolkit. Use a set of tools to translate customer insights into value propositions and business models and to build partnerships for co-creating the market and to accelerate, applying the principles of lean start-up and effectuation
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Innovation performance management
A company needs to have an innovation strategy, making a clear distinction between the strategic objectives for product development and those for new business creation. Creating new (disruptive) business within a large company will only be successful if it is clear, internally as well as external, why the company is doing it. Although new business creation is essential for long-term financial growth and competitive advantage of the company, the ability of start-ups/ventures to demonstrate strategic value, return and impact, remains a barrier as the company patience is often between one and a half and three years, but the first positive financial results of start-ups/ ventures are only visible after five to seven years. Therefore, it is important to demonstrate and communicate not only the financial but also the strategic value of new business creation. This requires the definition of business metrics that can be quantified and communicated in terms relevant to the company and to partners.
Performance indicators for existing business are turnover and profit. Large companies also frequently apply the same performance indicators to ventures. However these two financial indicators are not the right incentives for new business creation projects , especially in the early stage. Ventures should be managed on cash. Focusing too soon on sales often leads to loss of focus since all deals closed will be accepted without considering the question of what would thereby be contributed to the learning process. The focus of a venture should be on the underlying mechanisms driving revenue and cost. The focus should be on the leading performance indicators and not on the ones that are lagging. As the established businesses are more or less predictable, managers focus on expected returns, whereas ventures focus on affordable loss as they have to deal with uncertainty.
We support you in defining the required performance indicators for each of the individual innovation members as well as performance indicator for the whole innovation family.