In various presentations, papers and books on innovation or leadership I have come across an organisational pattern I like to call “Start-up then Core”. It is a pattern based on the idea that a new dawning business needs a special kind of leadership and special people, skilled and prepared to innovate in an uncertain world. Those in favour of this pattern also suggests that a mature business with “Execution” as its main mission needs leadership and people aimed to dwell in a more repeatable and secure world.
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A Start-up can appear in many forms. Any form between completely outsourced to an external party to just a few internal persons allowed to put time on future ideas. Sometimes the future work is very systematic with clear objectives, sometimes it is just random exploration. Anyhow, in all cases management have decided to do something about the future and reserve the resources they currently can afford.
The challenge
But what to do with the future ideas in the long run? When the "Start-up then Core” pattern is practiced the ultimate challenge is always how to scale the ideas.
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Another well known fact is that many prosperous businesses will not keep on flying. A widely used measure is the list of the Fortune 500 companies. A number of articles point out that just 12% of the Fortune 500 companies included in 1955 were still on the list in 2017. Mark J. Perry, who is Professor of economics and finance, calls this phenomenon “creative destruction”. And all signs show it will get worse. In a report in 2016 Innosight writes that half of the S&P 500 companies are expected to be replaced over the next 10 years.
What are the thought leaders saying
Much of the business literature describes how to do innovation and delivers many examples of successful serial entrepreneurs. But hardly any literature gives practical advise about how to continuously develop a business by transforming it into the future over time. Some books like Good to Great, written by Jim Collins, does take a long term perspective but it is mostly about high level principles rather than organisational patterns.
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Given the fact that disruptive businesses come with a steady and increasing flow the most important skill for leaders everywhere must to shape the future. I'm surprised so many leaders of thought and practice promote the "Startup the Core" pattern. Is it wise and far to just let either a new or an established part of a business die?
A sustainable alternative
Then what is the alternative for any top executive who feels frustrated over the ability to stay in shape for the market and have at least the same development pace as the competitors. I argue that the "Start-up Then Core" pattern is far too risky. It has worked for some and will work again, but without plenty of luck and a full wallet there are more reliable and deliberate paths. The organisational pattern I promote I like to call "Start-up And Core". The name looks very similar, but the "And" changes everything. "And" is all about integrating any new business with the current business from start and let the two evolve together step by step. This is a pattern that is easier to sustain over time and it is less risky.
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Silos..picture of value chains and functional entities
ignite your coworkers passion and energy
Tech driven instead of driven by values and customer need
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