Harnessing the Power of Entrepreneurs to Open Innovation

Jitendra Kavathekar: Managing Director, Accenture Open InnovationMadhu Vazirani: Thought Leadership Senior Principal, Accenture Research

Tuesday September 8, 2015

Harnessing the Power of Entrepreneurs to Open Innovation

2Copyright © 2015 Accenture All rights reserved.

of Fortune 500 companies have disappeared since 2000, mainly due to the disruption of traditional industry models by digital technologies.

of revenues of large companies expected to be generated from digital products and services in the next 3 years, up from 16% today (Source: Accenture Research)

Markets are being disrupted by digitalThe last decade saw start-ups and entrepreneurs disrupt traditional markets.

In the next ten years, large companies will use digital to disrupt markets themselves.


Large companies and entrepreneurs must learn to collaborate effectively

The good news is that large and small companies show every intention of collaborating with multiple parties

How important will collaborating with these stakeholders be in driving your innovation & growth in the next 3 years?

“82% of large companies say they can learn from entrepreneurs about how to become a digital business” Source: Accenture Research


And both camps see the benefits of working with each other:

• Collaboration based revenues at large companies will jump from 9% today to 20% in 5 years

• 82% of large companies say they can learn from entrepreneurs about how to become a digital business

• 46% feel the need to work with entrepreneurs to be sufficiently innovative


The nature of collaboration must change

“How can I create an ecosystem of partners collaborating on equal terms?”

“How can I get others to help me do what I already want to do?”

From bilateral collaboration done on the terms of large companies, to more open ended collaboration with multiple parties


The journey to Open Innovation


Ecosystem Innovation: The power of platforms

Ecosystem innovation represents a shift to an external mindset in which risks and rewards are shared mutually. It demands greater levels of digital collaboration in a wider ecosystem.

“There will be more than 100 new digital industry platforms from non-tech companies by 2016” (IDC)

“In 2013, 14 of the top 30 global brands by market capitalization were platform-oriented companies” (MIT)


But large companies and entrepreneurs do not see eye to eye

CommitmentEntrepreneurs and startups are four times more likely to say their large company partners lack commitment than corporates are about their smaller collaborators

Source: Accenture Research

Culture


How culture compares

Source: Accenture Strategy

Comparative cultural trends between startups and large companies


Eyes on the prize

NEXT 5 YEARS: 20%

Proportion of large companies’ revenues generated by collaboration with startups/entrepreneurs

TODAY: 9% Spillover effects on economic growth


Taking action

Large companies• Visibly embrace collaboration

top-down

• Define and budget for success

• Seed an “intrapreneurship” culture

Entrepreneurs• Align to the market

• Adapt culture

• Time it well

Governments & policy makers• Develop co-financing models

• Incent collaboration between large companies and startups

• Create collaboration networks

• Encourage a borderless physical world

Bridgemakers• Open up access to supply

chains

• Accelerate the network effect of role models and mentors

• Bridge the cultural gap


Accenture Open Innovation As A Service

Start-ups• High risk• High charge velocity• Delayed economic value• Seek disruption

Global 2000 Companies• Immediate economic value• Low risk• Low change velocity• Look for guided disruption

Open InnovationTech Labs

Emerging Technologies GroupGrowth PlatformsOperating Groups

DeliveryAccount Teams

Accenture as a bridgemaker


Accenture Open Innovation as a serviceDiscover-Validate Operationalize-ScaleEnvision

Define Digital Strategy

Rapid business model & technology ideation for digital products, services & experiences

Prototype, launch, and manage digital products, services and experiences

Future of the Industry

Build MVP(s) Identify and implement new digital capabilities, embed as core in the organization

Your role in the future

Validation (Market, Technology, Organization, Partners)

Gap analysis – Technology, Organization, Operations

Kick-start Innovation Program – team, funding, mandate, exec sponsorship

Develop and execute transformation roadmap and operating model across culture, structure, process and technology

Define Innovation Strategy


Be a Catalyst to Change to Open Innovation

Business

Harnessing the Power of Entrepreneurs to Open Innovation