Burdened by the monolithic Stage-Gate process, invented over 30 years ago, the innovation bankruptcy of large companies continues.
We’re seeing the rise of “Accelerators” and “Venture Capital Arms” of large companies and this is somehow seen as a positive trend? All it demonstrates is that large companies are bankrupt when it comes to innovation. The major culprit here is the blind adherence to a concept whose time had come and gone, Stage-Gate. The days of 18 month NPD is dead and buried but it lives on, zombie like, in large corporations. So, instead of changing corporate culture the “smart” executives have effectively outsourced innovation!
As Peter Bodenheimer, Program Director for food startup accelerator Food-X says “big food brands used to dictate what people ate. Now, young competitors are offering people more choices, and responding more quickly to trends”. Speed, speed and more speed that’s the mantra today. As Daniel Grubbs, MD of PepsiCo Ventures Group says “the Pepsi accelerator helps the company figure out what new products consumers are responding to.” And this admission of defeat is said without any humour at all!
Admittedly some companies, like Chobani, seem to be using accelerators to grow companies providing social benefit but they’re the exception.
The best example of the true innovation culture is Indie Bio in San Francisco, where for USD250k they take 5% of the company and the participants have 4 months to provide proof of concept and get investors. Now that’s rapid innovation!