For the last 10 years, Star has been creating digital products for organizations large and small. What it takes to be successful in a large enterprise vs a scaling startup is different. But from our privileged position with a foot in each camp, there are many things that we believe each organization type can learn from the other in order to deliver better digital products. I’ve summarized a few of the top lessons to be learned below.
In the startup world, the mechanics of raising capital mean that product leaders have a clear view of the runway the business has. As long as the business has a good CFO, the leadership understands the time the business has to deliver on its goals before having to raise additional funds. In this way, the financial capital that fuels startup product development is relatively stable and well understood. However, this is often not the case in corporate innovation. While most organizations have formalized funding approaches for innovation, the financial capital within these processes is largely driven by political capital, which is harder to quantify. How long will the idea be in favor with senior leadership? Is someone willing to stake their next promotion on the idea being successful?
Opportunity for corporates to learn from startups — Corporate innovators should look to adopt the runway mindset, and understand that, while they may have the financial backing needed, political capital is finite and being spent. Think about the activities and information needed to support “a raise” in political capital when reserves are dwindling. This could involve sharing progress in a wider forum, creating a Trello board for other colleagues to suggest new features or going for an industry award.
One area where corporates have an undisputed upper hand is access. Access to customers, markets, partners and talent. Many times our startups clients tell us life would be easier, if they had the sort of access that corporate incumbents have. However, it is rarely as simple as this. Getting access to the market for a new initiative within a corporate is a great challenge. With new initiatives threatening established orders and competing with many other priorities, it is rarely as simple as finding the right person and asking for support.
The successful change makers within large enterprises bring their ideas to reality by creating compelling narratives and convincing gate-keepers to grant access. Whichever type of organization you are in, getting access to the support your initiative needs is dependent on crafting a captivating message, something that people want to engage with and support.
Opportunity for startups to learn from corporates — Create your own market access by investing time in the storytelling around your business. Be compelling and make people come to you.
The role of delivering products to market is often highly distributed within large organizations with many competing initiatives and structures, and rarely are these structures customer- or product-centric. By contrast, most startups are structured around their product with “full-stack” product teams, armed with all the skills they need to deliver products to market.
Opportunity for corporates to learn from startups — Once new initiatives move past the idea stage, assemble dedicated product teams and empower them to deliver the initiative.
One of the greatest assets of a startup is the high prevalence of growth mindset within the teams. This contrasts with a typical corporate mindset that contains a high degree of risk and stakeholder management. However, we feel the most useful mindset is somewhere in the middle.
Opportunity for startups to learn from corporates — Startups need to balance the “move fast and break things” mindset with a more responsible mindset that considers purpose and the impact of technologies and services on society.
Resource & talent
In both corporate and startup settings, resources and talent are scarce. Particularly if your organization is set up in a competitive digital talent market. For startups, it’s small teams and tight budgets; for corporates, it’s multiple initiatives competing over in-demand skills. In the UK, where I am based, in 2019, the CBI identified that UK businesses were losing out on £63bn a year, due to a lack of digital skills.
Opportunity for both — Think about what you need to make a product successful, not what you have, and look to experienced partners to help you go further and faster.
In summary, I believe that the old adage that the grass is not always greener, holds true here. But there are lots that both corporates and startups can learn from each other when it comes to successfully delivering digital products.
So what have I missed? Where are there other opportunities to learn?