Innovation & Corporate entrepreneurship

In this world of hyper-competition, a reliance on classic models cannot guarantee future organisational growth and prosperity. The standard approach to competitive advantage expects revenue growth and a reduction in expenses in order to achieve incremental growth, allowing financial performance similar to the average market benchmark, or slightly more than that. However, the core challenge is not in improving the ratios between revenues and expenditures; it is in changing the game altogether.

The business arena has become more and more polarised between two kinds of companies. There are those who see the average market's benchmark performance as a goal, and improve their own performance incrementally; while on the other hand there are companies who have leapt into radical innovation by changing their mindset, and succeeded in "Wealth Creation" for their stakeholders.

The current reality is clear – in a nonlinear world, only nonlinear ideas will create new wealth. Workshops developed by Lahav Executive Education, Tel Aviv University intend to accomplish these kinds of mindset shifts and business breakthroughs. The following case study is only one example of the many successful partnerships we have brought to fruition over the years.

Innovation in the “Start-Up Nation"[1]

The inception of the “Start-Up Nation” was brought about thanks to diverse factors that, when put together as a holistic ecosystem, created a synergetic effect encouraging entrepreneurship and innovation. Necessity is as always the cardinal driver of innovation – Israel's natural resource scarcity, the fact that it resides in a hostile neighbourhood, and its remoteness from target markets drove Israelis to think of different ways to succeed. The remoteness and isolation, combined with a small local market, forces Israelis to think globally from the beginning of their venture’s lifecycle.

Innovation and new ideas come from vibrant networks of diverse thinking. Israel is a small place that since its establishment over 70 years ago has grown from a population of half a million to over eight million, mainly thanks to immigration. These immigrants have brought their values, culture, and ideas, combining them into the mix. The compulsory military service served as fertile ground for this diversity to be leveraged into effective social networks.

Another factor for the success of the Start-Up Nation is the values and culture of the Jewish people, or what Dr Yossi Vardi, one the best known serial entrepreneurs in the country, called the “Jewish Mother”. Failures in general are acceptable events in Israeli and Jewish families; the key is to turn failure into a lesson and get back on your feet. With sound risk-taking mechanisms, patience, and solidarity, promising entrepreneurs have been able to fulfil their potential.

These factors, combined with state-of-the-art academic research and government support, have helped cultivate innovation and design unique methodologies that promote the prosperity of innovation in Israel.

Workshop design and objectives

Lahav Executive Education has partnered with a global agro-chemical giant. Its head office is in Israel, but its subsidiaries are strategically located throughout the globe.

As an off-patent manufacturer, innovation and breakthrough products might not be perceived as core elements in the company's DNA. However, in order to become a true market leader, it could not afford to focus on incremental growth, to evolve at the pace of the market, and it has committed to creating new value for its customers, stakeholders, and the community as a whole.

Led by the corporate innovation development team, a global initiative was put into action to instil the abilities and mindsets of corporate entrepreneurship (intrapreneurship) and innovation throughout the company's subsidiaries. For this purpose, we served as the strategic partner to design and deliver this global endeavour.

A blueprint of the intrapreneurship and innovation facilitation workshop was designed, and adapted to serve corporate headquarters and global subsidiaries. The workshop was delivered eight times, and corporate officers, line managers, and professionals stationed in strategic intersections of the company participated.

A four-day intensive, result-oriented experiential learning process was designed and put into action. The model, an epitome of the Start-Up Nation concept constituted a synthesis between state-of-the-art academic knowledge and cutting-edge practices developed in the industry. Lahav Executive Education has successfully applied these approaches before, tailoring the process for groups of senior executives from around the globe. In this instance, the practical learning process guided corporate participants through the core stages of innovation creation. The programme and workshops delivered aspired to promote corporate innovation, and facilitate its implementation through the programme's participants, who later served as organisational innovation champions. The programme was designed and executed while fulfilling these goals:

• Generation of new radical innovation ideas.
• Expose participants to core pillars of innovation used and applied in fields outside of the current core activities of the company.
• The programme's design helped empower and leverage the ideas generated by innovation leaders.
• Facilitate and promote innovation projects, while granting participants advanced operative tools to implement innovation.
• The programme and associated learning process created a forum of innovation leaders, serving as a significant engine of innovation and growth throughout the global corporation.

Framework and Contents

Workshop participants came from diverse professional backgrounds and organisational hierarchies. Over a period of four days, the group underwent a process that gradually brought them to the point where ideation turned into innovation plans. The preliminary topics of complexity and uncertainty, followed by strategic innovation and leveraging of networks, laid the ground and created a sense of urgency regarding corporate innovation. These topics set the foundations of understanding how innovation should be regarded in the organisation – “intrapreneurship”, why it is important, and benchmarked success and failure stories from other organisations. The following workshop was where the real magic happened. Through systematic creative methodologies facilitators guided the group through ideation – the creation of as many ideas as possible – funnelling them through the application of a screening system.

Outcomes

Each workshop generated 3-4 applicable radical innovation projects. By definition, the projects were removed from the company’s existing product lines. Projects were chosen by corporate management according to their maturation expectancy – medium to long rage, with an average maturation expectancy of 12 months.

Corporate management chose which projects would receive funding and resource allocation, not only in the immediate future, and also set milestones for a second and third round of investment, subject to positive proof of concept validation.

The innovation projects were certainly direct products generated by the workshop. However, the process encompassed additional values, benefiting the regional and corporate levels. Diverse teams initiated the projects, engaging subsidiary managers throughout the globe. Serving as a melting pot, the workshop leveraged diversity and perspectives to enhance dialogue, create synergies, and promote cooperation between business units and corporate – line. As in all complex global corporations, HQ and field offices are not always in sync, cultures are different, and business approaches must be adapted to local requirements. However, once these flaws are recognised and accepted, they have the potential to turn into features, or even corporate assets. Development and learning programmes are the ideal setting to do this, especially those engaging participating executives, encouraging them to share and act outside of their comfort zone.

These outcomes could not have been achieved without corporate management's sincere commitment to the process itself and the application of the selected projects within the company’s services.

Join Udi Aharoni’s masterclass at the MERIT Annual Summit in Seville on 5-6 February 2020.

To learn more about Lahav’s customised programmes for organisation, please visit the Lahav Website or contact Efrat Rosenbaum, Global Relations Manager, efrat@lahav.ac.il.

By Udi Aharoni, General and Academic Director Lahav Executive Education, Tel-Aviv University