Large corporations must become far more agile in implementing new products and new business models. The pace of technology change, the blurring of industry boundaries, and the agility and resources of startups in almost every industry segment demand it.
Many companies have begun to adopt the principles of Lean Startup in order to increase the pace and agility of their innovation initiatives, but most have had limited success in doing so. Although the principles seem intuitive and straightforward, there are challenges to using them inside an existing company, especially in a manufacturing environment. The biggest requirements, beyond those espoused for startups, are:
- Developing a business model for the new venture that not only works in the marketplace but also works within the constraints of the corporation
- Managing the conflicts that inevitably arise with the current operating business; every business that has operated over decades has well-established ways of doing things that may not fit the required pace and flexibility required of a new venture
- Conducting business experiments with physical goods as well as with software offerings
- Managing the risk of investing in a new domain for executives that are used to investing where the risks are more clearly understood
This book describes a systematic approach for implementing Lean Startup in large organizations. It builds on the principles of Lean Startup and adds additional practices required to manage the realities of the corporate context. The book describes how it is done, with examples from practice in companies that have successfully used the methods. It complements Lean Startup methods with elements of corporate innovation practices developed by leading academics and practitioners. It brings these practices together for the first time in a practical and integrated way.
Table of Contents
Preface: Why this book
About the Author
Chapter 1: Introduction
Chapter 2: Lean Startup in a Nutshell
Chapter 3: What’s Different in Large Organizations
Chapter 4: Containing the Chaos: The Innovation Stage-Gate
Chapter 5: Working with the Performance Engine: Graduated Engagement
Chapter 6: Achieving Strategic Alignment: Asset-Based Opportunity Spaces
Chapter 7: Introducing a New Business Model: The Business Model Pyramid
Chapter 8: Organizing for Growth: The Separate-but-Connected Model
Chapter 9: Making the Bet to Win: Ambidextrous Leadership
Chapter 10: Yes… AND: A Summary of Practices
Jim Euchner is an expert in driving growth inside large enterprises, with a track record of delivering top line and bottom line growth through radical process innovation, new product introduction, and the launch of new businesses. His experience includes senior leadership positions in the automotive, manufacturing, telecommunications and oil and gas industries. He was a pioneer in the use of design methods inside companies and has developed practices for the use of Lean Startup techniques that are effective in the corporate context. Throughout his career, Jim has focused on the practical application of emerging technologies, including AI, machine learning, cloud-based predictive analytics, operations research and the Internet of Things
Most recently, Jim was Vice President of Global Innovation at Goodyear Tire & Rubber Company, where he led the development of new businesses and incubated and launched four businesses on three continents. Prior to his work at Goodyear, Jim held positions as Vice President of Growth Strategy and Innovation at Pitney Bowes, Inc. and Vice President, Network Systems Advanced Technology at Bell Atlantic (now Verizon).
Jim is industry co-chair of the Advanced Services Partnership at Aston University (UK), where he is also a Visiting Professor. He was a member of the Scientific Advisory Council for the Nissan autonomous vehicle program and is a co-founder of the MIT Innovation Laboratory, a consortium of companies focused on user and community innovation.
Jim is Editor in Chief of Research-Technology Management, a peer-reviewed journal for practitioners of innovation, technology and research management. He has published and spoken extensively on innovation and technology management, including award-winning papers on Business Model Innovation and applied applications of artificial intelligence. Jim holds 13 U.S. patents. He is particularly interested in business model innovation and the effective use of Lean Startup approaches in large organizations.
Jim received his Bachelor of Science degree from Cornell University in mechanical and aerospace engineering and his Master’s from Princeton University, where he was a Guggenheim Fellow. He also holds an MBA from Southern Methodist University.
Startups are not just smaller versions of larger companies. The tools for effectively managing new ventures are different from those for managing existing businesses. This insight was at the root of the Lean Startup methodology, and its corollary is also true: New ventures in corporations are not just startups that happen to be housed inside a company. Lean Startup methods work there, too, but additional tools are required. Jim shows us one path forward in this book.
Steve Blank, Adjunct Professor, Stanford University; Co-founder of the Lean Startup movement
Jim has been involved ln leading-edge innovation research with me at MIT for years, and has also led successful innovation inside corporations for decades. His focus has always been on making leading-edge innovation practices work really well in the messy, real-world context of Corporate America. This book lays out practices that work.
Eric von Hippel, T. Wilson Professor of Innovation, MIT Sloan School of Management
Can incumbents win the innovation game? Yes, but the tools and approaches are radically different for an existing company than for a startup. Too often, a large organization gives up too soon when they apply one of the most valuable systems—Lean Startup. Jim Euchner has codified the challenges, articulated the areas of resistance, and underscored the urgency related to a large company's need to embrace Lean Startup practices to accelerate to growth. This book looks broadly at universal truths about how to bring the best of Silicon Valley-inspired innovation existing companies so that teams can drive innovation at scale. It's a brilliantly constructed, deeply-researched, user-friendly guide for leaders who know they need to move fast like a startup but within an existing corporate culture. A must read.
Andrea Kates, SUMA Ventures, San Francisco
Bringing innovation to market in an existing corporation is challenging. Jim Euchner's book explains why this is so difficult, how to address those hurdles, and how to develop a successful start-up in an established company. He has developed an approach that is both practical and applicable. His book is based on real-life experience developed by himself and others, and I observed it first-hand working at Goodyear. The book is well written and easy to understand.
Jean-Claude Kihn, Former CTO and President of the Europe/Middle East business, Goodyear Tire & Rubber Company
Jim Euchner’s book ushers in the innovation enterprise. As we emerge from the unchartered waters of a post-pandemic world, A CEO’s greatest driver will categorically be innovation. Lean Startup presents a practical model to harness chaos into competitive advantage. My experience personally interviewing over 1,000 top CEOs leads me to believe that Lean Startup in Large Organizations could arguably be the most important book an enterprise CEO reads in 2022.
Robert Reiss, Founder and CEO, The CEO Forum Group
"The companies that squander innovative opportunities are often the same corporations searching for new avenues of growth because prospects in their core have stalled." Jim is one of a few rare individuals who have a firm foot hold in both theory and practice. This helps to ensure that Lean Startup in Large Organizations is well grounded, relevant and delivers impact as it provides readers with a set of practical tools to help bring a concept from idea to validated business.
Tim Baines, Professor, Aston Business School