Adobe Summit EMEA: It’s Time To Choose The Right Startup
Corporates should be working with the startups disrupting their industries to get good value on innovation, advises Narry Singh, head of digital strategy at Accenture.
Corporate innovation has just two problems. It costs way too much and rarely leads to anything particularly disruptive, claimed Accenture’s head of digital strategy, Narry Singh at Adobe Summit EMEA yesterday.
The point was underlined by the fact the life cycle of large companies in Standard & Poor’s top rankings is now just 14 years, compared to around 50 in the past. At the same time, corporations are spending 10 times as much on innovation as startups, yet it’s the startups that are disrupting their industries. While Google, Netflix, and Amazon have joined the top S&P listing, the likes of Compaq, Kodak, and Sears have all fallen out.
Partnerships, Not Theatre
The key for companies, then, is to avoid pretending to be innovative and also to replace massive schemes with smaller, actionable projects, Singh advises.
“You should avoid what I call ‘innovation theatre,’ where corporates dress down, hire a chef, and start speaking in jargon,” he says.
“That’s just pretending to innovate. The best approach is to look at whom you can partner with because there are so many startups out there who know how to fix problems you’re experiencing better than you and for a lot less money.”
Partner, Don’t Resist
These startups are typically eating into a small part of a corporation’s business by doing one or two things very well without being held back by the need to get the whole customer journey right. Typically this might be getting an item installed or delivered more conveniently for customers, or, perhaps, retargeting people who have abandoned trolleys.
Singh’s advice is that these companies are like a thousand mice all taking tiny nibbles out of a corporate’s business, but they are also a potential answer to the problems it experiences. Instead of trying to resist startups, it can actually partner with them.
“If you want to know the answers to the problems you’re experiencing, just look at the approach taken by startups in that area,” he says.
“You can then try to replicate it, but typically working with a startup is a lot cheaper and quicker. The challenge is then how a big corporation should work with a startup. In research we looked at, nearly half of all banks want to work with a fintech startup, but only 13% think they have the necessary systems in place to make it work.”
Verbs, Not Nouns
The other challenge is how large corporations can tell a prince from a frog as there are so many startups all claiming to be disrupting industries. They can often sound alike, they usually all have very good investors and are staffed by smart people, so how can a brand tell them apart?
“Look at the verbs and forget about the nouns,” is Singh’s advice. “Look at what they do and how they do it, and forget everything else. You need to debundle how they actually achieve what they claim to be able to do from the rest of their pitch, and then see if that moves the needle for you.”