Imagine you are an enterprise CEO in a business under increasing pressure to address the demands of continued growth, a meaningful ESG strategy, a fickler and more diverse customer base, a changing regulatory environment, and all the fallouts of the pandemic. Just for starters.
While the organization is full of talent who are expert at running the business, it’s clear that more is required to transform, adapt to ongoing and unpredictable change, and get much better at anticipating what’s next.
One day the CEO opens a dialog with a startup operating in an adjacent sector. Their technology is proven. The startup seeks to scale by partnering with large enterprises.
This CEO is captivated with the idea of engaging with the startup to help transform the enterprise. They know they must break old habits that are inhibiting innovation and change. They must learn new ways of operating. They imagine that this partnership is a win/win. Success will mean the enterprise is becoming a 21st-century business. And the startup will realize its goal of scale.
Everyone’s investors and customers will be happy.
It’s possible. Success begins with the enterprise and startup leaders anticipating how to:
- Bring together two radically different cultures, ways of working and talent profiles
- Ensure the machinery of the enterprise does not stifle the startup’s agility
- Transfer at scale new ways of working and new mindsets
- Convince stakeholders to buy in that this is a smart strategy that will deliver results
How does the vision of enterprise/startup partnership move beyond being more than a dream, and achieve a happy ending?
Commit to these three steps to head in the right direction.
1. Set a shared North Star, by coming to a common understanding of the partnership’s mission, vision, shared ambition, and success metrics. The best North Star ambitions complete such statements as:
“As a result of the successful efforts of our partnership, we will have succeeded when customers say …”
2. Engage in shared governance. Even the most motivated and resourced team tasked with bringing to life an enterprise/startup partnership will fail if the right governance is not in place. This means:
- The CEOs hold both executive teams accountable for the success of the partnership, and
- A routine is in place and adhered to for communications, agenda-setting and decision making.
3. Resource and implement disciplined, agile experiments. Big new growth stories do not emerge as overnight miracles. They come about through cycles of testing, failing, learning, iterating, and improving. As the capability for agile experimentation is created consider:
- How to operate outside the annual budgeting process.
- Whether the talent exists internally and can be dedicated to the testing efforts.
- Why it is critical for experiments to have established metrics at the outset.
As talented as the cross-business partnership team may be, they may benefit from a third party’s external facilitation with no stake in either entity’s pre-existing norms and who is only focused on helping the partnership succeed by bringing objectivity and additive operating knowledge. They will keep the team focused on the North Star, through the many challenges and doubts they will face, and pursuing proven practices to achieve their ambition.
The complete article from which this post is adapted is live at Fast Company.