Tag Archives: Scale-up

Pathways to Scale

Why planning your innovation expedition helps avoid a lot of trouble on the journey…

Image: Dall-E via Bing

GUEST POST from John Bessant

When I was a child a big feature of the social landscape was the annual visit to my uncle’s house on Christmas Eve. My dad came from a big family and they’d gather at his brother’s place to celebrate; my kid brother would already be asleep but I would sit in the small room next to the place they were all gathered, drinking, talking, occasionally singing. It was warm there; a small electric fire in the grate and a blanket to wrap myself in if I felt the cold.

Which was just as well since I invariably spent the evening with my nose in a book. Not just any book; as soon as we arrived I’d make a beeline for the bookshelf and haul out John Hunt’s account of the ascent of Everest. And I’d spend the evening while the ice crawled up the windows outside the room I’d imagine hearing the wind howling against the flimsy side of my tent as we shivered over a primus stove, trying to warm ourselves and get some rest before tomorrow’s big day. The last painful yards towards the summit…..

I was fascinated by the scale of the thing; a huge expedition, involving over 400 people (362 of them porters helping carry the 5000-plus kilograms of equipment) and relying on the intimate knowledge of the mother mountain held by the 20 Sherpas in the team. Those Nepalese guides had grown up in the shadow of the peak and knew to fear and respect it. The months of planning in smoky rooms in London clubs, the assembly and trek towards the base camp and the allocation of roles to help lay the foundations for what would certainly not be a simple walk in the park.

The extended discussions around which paths to take, the weighing up of different challenges along the prospective routes. Obstacles reckoned into the equation and balanced with the specialist skills and equipment needed to tackle them. A whole new language of cols and crevasses, of pitons and crampons to be learned, a crash-course in high altitude physiology and technology to be mastered.

And that was all before they even took their first tentative steps up the slopes.

It was engrossing, exciting and scary; for an 8-year-old kid whose experience of mountaineering extended to scrambling over the South Downs during our annual trip to see Grandma this was heady stuff. And as the evening wore on and we approached the summit, so it became a race against time. For the climbers, whittled down to Hilary and Tenzing, struggling up the last stage, their oxygen and energy running low and storms looming.

And for me hearing the chatter from next door rise to the climax which portended the taking of farewells, the wrapping of my kid brother in a blanket to continue his pre-Santa sleep in the car and me being bundled into a coat. Would I get to the summit in time — or have to wait until next year to continue the journey, abandoning mine at the eleventh hour?

I took a couple of lessons from that book, the first being that I’m not cut out for mountain climbing. There have to be easier and still thrilling ways to get your kicks and ‘because it is there’ isn’t a good enough reason for me to devote my energies to that particular kind of madness.

But the other is a healthy respect for people who scale mountains successfully. It takes a lot of planning, great team work and an approach to uncertainty which is all about agility and pivoting, adapting and improvising your way upwards.

Pretty much the key ingredients for successful innovation — and certainly relevant to another kind of scaling journey, enabling great innovations to have impact.

Because taking an innovation from a small-sized success story to something which delivers value at scale is not an easy one. The Holy Grail of impact has a lot in common with that elusive quest pursued by King Arthur’s knights, taking them along strange paths, meeting with dragons and disasters and lasting a long time. Similar odds of success too.

Having spent a long time focused on the challenges facing start-ups the innovation spotlight is now moving to the question of scaling — and there’s a helpfully growing body of knowledge and codified experience around this theme. Including the important decision about which route to take for the journey to scale.

One thing about mountain climbing which I remember thinking about when reading my Everest book was how they chose which route to take. Faced with 29,000 feet of sheer white walls with the occasional dangerous looking black rock poking its jagged edge through the snow like a knife through a curtain, how do you decide which path to take? It’s not as if there are well-worn tracks and clear signposts which you can follow — all you have is a lot of very unfriendly and treacherous ground on which to try to make your way.

It’s the same with scaling your innovation. Choosing your preferred pathway to scale is a key first stage on the journey; fortunately — like today’s Everest climbers — there’s a wealth of experience available from previous attempts and some important lessons on which we can build.

In particular we need to see the choices available as lying on a spectrum where we trade off additional external involvement with giving up a degree of control.

It’s a strategic decision, trying to balance the resource commitments you’ll need to make with the amount of control you want to retain. And with deciding what parts of your innovation knowledge are core, what parts are modular and can be adapted and customized with others in mind and what parts are you prepared to let others engage with, ‘hacking’ their own version of your ideas. Scale stories give us valuable clues about possible options, which include not doing it!

Some innovations aren’t really about a scaling journey. They work for a particular problem in a particular context; what’s needed for impact over the long-term is sustainability, being able to continue to deliver over an extended period of time and becoming something which is used and relied upon.

But if you are going to aim for scale then your choices include:

· Parachute — develop the venture, then try to get acquired, a classic start-up exit strategy. Let someone with the experience and the resources buy your solution, let it go. Easy on paper but you give up all your control and can only watch from the side-lines as your venture develops, and hope it’s in safe hands…

· Go it alone — keep on adding staff and spreading your solution across different geographies, gradually paint the world (or your chosen part of it) in your colors. There are plenty of advantages to doing this — mostly you keep control and you can directly manage quality, message, brand, etc. But the downside is you’ll need a lot of people and resources and you’ll pretty soon reach the point where you need to rethink your structure. The old tight-knit start-up team has to give way to a structured organization, complete with policies, procedures and a slowing down of the decision-making process. Plus you’ll need to adapt your solution to different local conditions — compatibility. And cost management will be important, finding ways to grow without bloating.

In reality this organic growth kind of approach can’t be a solo act — there will be things you need to outsource like legal services, manufacturing, distribution or maintenance. And it can also take time to build your own networks.

· Replicate — maybe your solution idea is one you think will work simply by replicating, placing the same offer in different geographies with only minor tweaks to help it fit. If your solution is something which can be ‘packaged’ and exported — a plug’n’play option — then this can work. It can either be a ‘grow your own’ approach, repeating the pattern by putting down your footprints on an increasingly broad geography. That’s the kind of route followed by IKEA and many other retailers, embodying their innovation solution in something which can be replicated.

Or you can franchise, allow others to take on the task and replicate on your behalf, sharing the revenues and building on your original innovative efforts. That’s the route which McDonalds has followed, exporting its original innovative fast-food format to over 39,000 locations around the world. But as Ray Croc, their scale architect realized, there’s a critical need to make sure the rules are clearly codified and then control via the franchise agreement so your proxies don’t damage the brand, compromise quality or change the core product. It’s a kind of remote control based on a clear constitution….

· ‘Relay replication’ — another version which involves another organization adopting and using your solution. Like franchising it requires protocols, training, standardization of core elements and processes but it also allows the adopting unit to continue to adapt and innovate within agreed parameters. A classic model here might be the diffusion of chemical plants like oil refineries; the core technology is transferred and the user learns to operate. It needs more than simple delivery, not plug n play — it involves a shared extended handover process until the user can make ‘product in a bottle’ with its own staff operating the equipment.

The advantages here are that you learn every time as you coach different organizations in the use of your innovation, plus there’s the chance that their downstream learning feeds back to you and allows you to improve your innovation. But it takes time and resources to ensure a successful handover, with key knowledge being shared through training, manuals and protocols and a long-term commitment to support.

· Licensing is another variation on the replication theme where other players can take on and (depending on the terms of the license) do things ranging from simply selling the core package through to adapting and extending it to suit local conditions. The big advantage is that other players are putting their shoulder to the wheel, helping spread the innovation, plus there’s a direct financial return to the original innovator. But once again it does involve letting go of control.

· Open source/open licensing — much commercial innovation is about finding ways to appropriate the benefits. So there’s pressure to keep a tight rein on what’s shared and how. But if you want to spread something, especially a novel approach, you might want to open up more to accelerate diffusion and seek your returns from being a first mover, growing with the market. There’s plenty of examples — Philips wanted to change the way we consumed recorded music in 1993 when they launched the Compact Cassette and so licensed it for free to others like Sony and Matsushita. It makes sense — if you are trying to establish a new ‘dominant design’ and move the world away from the current incumbent then recruiting others via open licensing is a good road to take.

And in the world of social innovation this has particular relevance; innovators who want to change the world for the better face the same challenge and recruiting others to the cause offers one way of doing so.

There are several advantages to such an open approach, not least it recruits many innovators who may help improve on your ideas. Communities of practice and using the crowd have become powerful innovation engines through this approach of free sharing; Linux is a good example.

Image: Dall-E via BIng

Lego’s approach to the hackers who started to modify the original ‘Mindstorms’ product is interesting here; they were presented with a different option to the traditional lawsuit which they might have been expecting. They were invited to Denmark to add their innovative ideas to those of the core design team!

But the downside, of course, in such open approaches is the loss of control and the risk that the innovation may be hijacked or developed in directions which do not match those of the original authors or reflect their social values.

· Strategic partnerships make sense where there is a clear need for ‘complementary assets’ of knowledge or other key resources and where win-win arrangements and contracts can be put in place. Christopher Sholes and colleagues had developed a great solution to the typewriter opportunity back in the 1850s but it took their strategic partnership with Remington and their accompanying mass-manufacturing and marketing to scale their innovation.

· Multi-player consortia may be needed when the range of complementary assets needed goes beyond a single partner. Sears and Roebuck pioneered the remote retailing model with their mail order catalogue approach but they needed to bring together many other players into the model to make it work — finance houses, logistics and distribution and a wide range of different suppliers. Boeing and Airbus do the same today, orchestrating extensive networks of players and partners to deliver their aerospace solutions at scale.

Such consortia bring real power to the scaling challenge but also require careful integration around a core mission. Managing such ‘strategic networks’ is well-known for its high transaction costs and co-ordination challenges.

· Value network and ecosystems — today’s innovation language extends this multi-player game, recognizing that there is a need for multiple players to work together to create value at scale. The challenge is that not all of these players have the same goals or aspirations so balancing their needs with the overall ‘mission’ becomes a tricky balancing act. It’s also important to recognize that such ecosystems don’t just have shared value creators in the mix like our strategic partnerships; they may also involve other players who affect the journey to scale by shaping the ways in which the value creation game is played. Examples of such shapers include government regulators, trade unions and standards organizations.

Once again this has particular relevance for scaling social innovation where system change which delivers real impact may depend on finding ways to bring many diverse players, like government agencies or regional authorities onside. As an influential IDB report puts it, such collaborations require ‘…different actors to coalesce around a shared set of priorities and best practices’.

· Platforms — we’re also now seeing the rise of platform businesses which enable scaling through linking innovators and markets more effectively. The Taobao market approach pioneered in China mimics in many ways the ecosystems around Apple’s developer platform or much of the Amazon operation. For small start-up innovators such platforms become a powerful alternative route to scale, but at the cost not only of accessing the platform but also in letting go some degree of control.

For any innovator climbing Mount Scale remains a key challenge. Meandering around the foothills may be a pleasant way to pass the time but if you want your innovation to have real impact then that peak has got to be climbed. Which means putting together and planning your expedition with the kind of care and attention John Hunt brought to his Everest team. And my guess is that his reflections probably have relevance in the world of innovation. Working out the most appropriate route up those slopes is something best done in the comfort of base camp rather than halfway up the mountain with the wind howling and the snow lashing at your face as you realise that the other path might have been a better one to take….

Image: Dall-E via Bing

This blog is based on our forthcoming book ‘The Scaling Value Playbook’ — click here for more details and to pre-order

You can find my podcast here and my videos here

And if you’d like to learn with me take a look at my online course here

Image credits: Dall-E via Bing, John Bessant

Subscribe to Human-Centered Change & Innovation WeeklySign up here to join 17,000+ leaders getting Human-Centered Change & Innovation Weekly delivered to their inbox every week.

Scale Your Business in Four Simple Steps

Scale Your Business in Four Simple Steps

GUEST POST from Helen Yu

As a new founder at the beginning of your entrepreneurial journey, you have many tasks at hand and little bandwidth to do them all. There are countless responsibilities, from everyday tasks like investor pitch decks and elevator pitches to longer-term tasks like business plan revisions, product launch strategy and much more. How do you know if you are putting your time and energy into things that matter? It all comes back to why you started your business in the first place — understanding your “why” will keep you going when the road gets tough. But “why” alone is not enough for the long haul. You must couple your “why” with four specific steps needed to scale a business:

  1. Intentional go-to-market preparations
  2. An ability to adapt to customer needs
  3. A willingness to acclimate or even restart in the face of changing or more demanding market environments
  4. The heart to celebrate with your team when you collectively hit milestones along the way

I learned this approach while ascending one of the world’s most famous mountains.

Here is how I learned how to scale a business to success:

In 2007, I climbed to Mount Everest base camp. It took hundreds of hours of training and dedication to achieve my goal — including staying committed to the climb while my hands were freezing from the cold and my head felt heavy from the rising altitude.

Why did I keep climbing?

Because I had made a promise to my grandmother to spread her ashes on a tall mountain. That “why” gave me the will to keep moving forward. It gave me the courage to see my limitations and overcome them: to learn mountain climbing and train my body to withstand it, to find a Sherpa guide who could lead me into new territory. My goal of climbing Mount Everest started not on any map but in my mind. It was a dream that became my North Star, helping me choose the actions and paths needed to fulfill my grandmother’s wish.

Your startup has a similar North Star: the reason that led you to start the business in the first place. You also have an inner voice that serves as Sherpa guide. Why did you start this business? Who are you serving with it?

By asking yourself these questions, you will find the determination and grit to keep moving forward and find the keys to scale a business. A North Star may look distant and unattainable, but it is achievable when you take consistent actions to reach it.

1. Prepare

You may already have an answer to your “why” in a formal mission statement or vision statement, but are your company’s actions in alignment?

When strategy and execution aren’t aligned to the mission and vision, disconnects occur. Internal communications break down. Customers are dissatisfied with their interactions with your company. Growth opportunities are missed. Investors become wary of your potential to survive.

With your “why” kept front and center, you will be able to choose the actions that support it and overcome these common disconnects. It all begins with preparation. Before you begin your startup climb, be sure that you’ve lined up your partners and support team. Don’t go to market until you have processes in place to hear and respond to your customers.

Your startup’s “why” must not simply be mentioned in a high-level vision statement but must also be integrated into all of your company’s operations, from product creation to marketing.

Do your employees understand your company’s mission and vision? When your team understands their impact, they can find more fulfillment in their jobs, which leads to alignment across the company and higher performance.

2. Adapt

Your North Star, or “why,” will not change, but the vision and strategy for reaching it might. You may find the business you started is not the one that will move you forward toward that North Star. At that point, you must either implement changes within your business to move you closer to those goals or create something new entirely.

Often wedded to their original ideas, many founders resist adapting even when it becomes evident they’ve misread the voice of the customer. Stay aware and agile. This is the time to pivot, perhaps even redirect, to incorporate the customer’s voice into decision-making.

Be ready to test your assumptions of what is working and what is not. Your “why” may take you on new roads that you never thought possible, and your ability to adapt to your customers along the way can keep you moving forward.

3. Acclimate

Adapting is all about shifting direction. Acclimating means pausing, or even restarting, listening to the customer’s voice and adjusting to demanding markets that have little margin for error.

Like climbers who reverse and go back to base camp after reaching each summit, the reflective, backward steps of acclimatization will allow your business to figure out repeatable success (the cornerstone needed to scale a business!) and keep you moving forward in the long run.

4. Celebrate

Finally, don’t save all the confetti and high-fives for the very top of the mountain. Remember to celebrate small wins, too. As a founder, you need to inspire devotion in others. Celebrating the little victories along the way is an expression of gratitude to your partners and teams and reminds people why they started the journey with you.

Startup culture is complicated, with many opportunities to get off track and lose the point of why you started in the first place. By keeping the “why” of your North Star front and center while preparing, adapting, acclimating and celebrating along your journey, you will make the necessary adjustments to avoid many of the pitfalls that cause startups to fail and, instead, start to scale a business with confidence.

Originally published on Startup Nation.

Image credits: Pixabay

Subscribe to Human-Centered Change & Innovation WeeklySign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.

Scaling-up, the next frontier for innovation organization

Guest Post from Nicolas Bry

How to transform innovative bottom-up initiatives into a movement spread across the company? How to scale your innovation program widely? Here are a few lessons learned from creating innovation programs in Europe, and tweaking them to Africa and Middle-East contexts.

Leveraging local and global innovation

Supplementing wisely central techno-pushed innovation with local innovation, closer to the fields and to the user needs, opening new windows of opportunities, is the goal of the open and local innovation approach developed for Orange Africa.

The purpose is to balance the technical expertise from a central innovation division, with the possibility of bottom-up initiatives, experimenting locally up to 100 innovative solutions every semester with the circa 20 countries where Orange operates in Africa and Middles-East.

The local innovation focus is on agility, pragmatism, and value created for the users and for Orange business, while leveraging a key technological asset that Orange can bring to the innovative service.

Smartphone Noir

One emblematic story is the birth of Orange Money, a mobile money service solving the problem of money transfer and payment for unbanked people. The idea was born in Kenya, and it clearly could not have emerged in Europe where everyone is banked, even kids! Orange developed centrally a platform capable of supporting all African countries in their progressive roll-out over 18 countries: ten years later, 50 millions users signed in for Orange Money. Furthermore, the central Orange Money platform enables local developments blossom, tailored to each country needs, and being picked-up, and replicated from one country to another over the region.

This is probably the most brilliant innovation of Orange over the decade, still no cutting-edge tech embedded: it’s low tech (SMS). As it solves a real user problem, it transforms people’s life, and got a massive adoption rate.

Orange Money map

Conducting short experiments in connection with business units

I created Orange intrapreneurship program 5 years ago, with a view to help innovative ideas transition more fluently into business, with the help of a sponsoring business unit, and to open the innovation doors to every Orange employee, letting them benefit from a tunnel of goodwill around their idea. The program acted like an innovation center of expertise or incubator. It clearly involved the business units very upstream: I’m a strong believer in co-developing innovations that create opportunities for business units, giving them a competitive advantage or solving one of their problems. “Find out the business unit problem that your innovation is solving”, I kept saying to the innovators I mentored!

Now we are adapting the process for the 20 countries of Orange Africa taking into account contextual particularities. We keep the employees participation and the business unit ownership aspects, but we also try to test refinements on the exploration stage. The key here is to conduct innovation exploration with short experiments in connection with business units:

  • achieving quick business wins with innovative process improvement, impacting internal organization, and not only new product and services: for instance, streamlining the authentification process for new customers;
  • mixing employees and business representatives with startups that help experimenting quickly; this has been pioneered by Orange Belgium, and these teams are called innovation squads like in the Spotify vocabulary;
  • keeping the process nimble, in a stretched time frame of a few weeks, so as to conduct a high number of experiments, confronting mock-ups to users, and collecting a maximum of users’ feedback, finding The Right IT before any product development.

Our target is to build proximity with our target users, rather than falling in love with our product, to explore and conduct short experiments, and pave the way to exploitation capitalizing on users’ feedback.

Personne Pointant Sur Un Appareil Photo Noir Et Gris Près De Macbook Pro

Designing innovation program, boosting innovation community

I’ve been through 10 steps to design an corporate entrepreneur program in my book The Intrapreneurs’ Factory. These 10 milestones are also an appropriate framework to design the innovation process with the countries of Orange Africa.

10 steps

It’s important first of all to define the reason why you start the program, what problem you’re trying to solve, what goals and KPIs will make the management team satisfied if they are reached. Then, some delicate gates are:

  1. Finding out the right sponsor, both visible and accessible; sometimes a deputy sponsor can compensate a lack of avaibility!
  2. Involving the business side soon enough in the process to trigger ownership, and  further facilitate the exit, aka the transition from exploration to exploitation;
  3. Closely coaching the process along the way, sharing the innovation tools from design thinking and lean start-up, bespoke tools to design mock-ups, and conduct experiment, but also the very peculiar mindset of the successful innovator: flexible and stubborn at the same time as says Jeff Bezos, as the key relies in the management of iteration in short cycles.

To operate this innovation process, we move together with a community of 20 staggering innovation champions, representing the countries of Orange Africa. Not only we discuss the innovation process to test locally, but we share view on innovation organization, and share success stories during a weekly Radio Innovation.

Radio Innovation

Weekly Radio Innovation also puts forward tremendous testimonials to inspire the innovation community:

  • from innovation managers and communities connected to Africa:  Seedstars startups competition and programs for African entrepreneurs; Make Sense Africa incubator and the Dakar Citylab; Norrsken Kigali innovation hub, the startups gateway to East Africa; YUX Design Agency from Senegal, validating innovation ideas with users; innovation in the informal sector in Africa with GoodPoint/Archipel-co.com; Total Africa open innovation in Chad; Entrepreneurship Communities for innovation in Africa, with Archipel&Co and Africa Farmers Club; Liferay digital platform, and an Africa’s approach to tech and innovation; Innovation in Africa with Vodafone;
  • from startups growing their business in Africa: cloud telephony for SMEs, with Mteja from Kenya, and AfricaTalks; South-African MFS Africa: moving money across countries with one API that makes Africa look like one country; Kenya Pezesha loan marketplace for small African businesses; Chari.ma from Morocco, market place for local businesses; African startups investment report by Briter Bridges;
  • from Orange collaborators illustrating the group assets: Orange Ventures Africa seeds challenge; Social listening with Orange Data Studio in Guinea; Orange Fab Belgium innovation squads; Orange Senegal design thinking toolbox; Orange Slovakia  open innovation; Orange Amman innovation team; First 100% digital mobile offer Flex by Orange Polska; Orange Romania innovation ecosystem, and cooperation with startups;
  • from broader innovation experts: innovation community management at Gefco; Booster incubation studio at Total; innovation in the energy industry, Innovation Vesta Wind Systems; collaborating with startups through the Venture Client Model, by 27pilots.

For these innovation champions in charge of setting-up an organization for innovation in their country, the challenge is to seek for integration (integrating seamlessly innovation with the business) before seeking for success. These mind-boggling testimonials feed them, upgrade their skills, and consolidate their innovation culture.

Scaling-up innovation oragnization

Once the innovation program gets traction, the next step is about scaling-up the approach, engaging progressively all participants. If all Orange countries commit to the innovation process in Africa, that will lead to the tremendous portfolio of 100 creative solutions experimented per semester, 200 on a yearly basis on the regional footprint: what a eye-catching achievement!

At the innovation project level, one can use the scale-up canvas to check whether the project is ready to grow, and move from a start-up to a scale-up stage.

At the program level, Is your innovation organization resilient? is the topic of a short assessment I have designed to know how your innovation organization fare across 10 key areas, and cements its resilience. Whether you are leading open innovation, internal innovation, participative innovation and intrapreneurship, digital factory or disruptive labs, you will learn from this tool which works like an innovation calculator, it’s actually quite fun to run it! To start, click here, see how you rank, and get pieces of advice for improvement.

Image credits: Pexels.com 1, Pexels.com 2

Subscribe to Human-Centered Change & Innovation WeeklySign up here to get Human-Centered Change & Innovation Weekly delivered to your inbox every week.