IST Institute

    The Institute for Strategic Innovation and Technology Management is the competence center for innovation and strategy. Research focuses on Strategic Transformation, Corporate Entrepreneurship, Startups, Ambidextrie, Agility and Digitalization.

    Dekoratives grafisches Element

    Research Initiative STRIVE.io

    Strategic Innovation Venturing Portfolio

    Not least in view of the challenges of digital transformation, entrepreneurial initiatives and projects have increasingly found their way into the corporate practice of innovation development. Various forms of implementing such corporate entrepreneurship or corporate venturing activities are known, such as incubation, acceleration, corporate start-ups, innovation labs and the like.

    The fundamentally positive effect of such activities on innovation culture and capabilities is widely accepted. However, it is not yet clear which parts of one's own technology and innovation strategy are most likely to be tackled with such alternative (rather than "traditional") corporate venturing approaches, empirical studies are lacking and best practices cannot yet be identified.

    It is therefore logical to observe that different forms of corporate venturing are used in parallel in large-scale industry (e.g. Daimler or Telekom) - however, their networking and coordination is a challenge that has not yet been solved. Due to the typical scarcity of resources and capital, technology companies of rather medium or medium-sized size do not have the possibility to carry out such broad and complex "organizational experiments" with these alternative approaches of corporate venturing or corporate entrepreneurship. Consequently, the use of individual corporate venturing forms is more likely to be observed here (incubation OR innovation labs OR corporate startups, etc.) - however, it is not clear here whether exactly this chosen form is the most suitable in relation to the respective company's own technology and innovation strategy, whether another would possibly be more suitable, or whether a meaningful combination of several of these corporate venturing forms would not perhaps be more target-oriented.

    Therefore, the project STRIVE.io will evaluate experiences from the large industry in the broader use of different forms of Corporate Venturing and with experiences of specialized service providers (e.g. pioneer spirit or What-a-Venture) for the application of such methods, derive best practices and develop procedures, processes and tools for the derivation and implementation of a strategy-oriented Corporate Venturing portfolio. This portfolio of entrepreneurial initiatives and projects in a company complements the previous procedures and processes to support more transformative technology and innovation strategies.

    Details

    • Background & Motivation

      Today, Baden-Württemberg is a leading high-tech location in Europe. Its industrial landscape is characterised by highly specialised technology companies that are often world leaders in their respective market segments - "hidden champions". Today, however, these often medium-sized companies face enormous challenges, triggered among other things by the effects of rapidly advancing globalization and digitization.

      As a result of these developments, markets are changing more and more dynamically and radically. The resulting complexity and uncertainty requires companies to be able to efficiently optimize today's well-known core business (incremental innovation) and to test and build possible new business models of tomorrow with transformational innovation initiatives (strategic innovation). If an organizational transformation through strategic innovation does not succeed, the dynamics in the competitive environment can quickly become a threat to existence.

      Transformation initiatives are aimed at building competencies and skills, some of which are far removed from current core competencies and require organizational transformation. Therefore, due to the high uncertainty in (possible) new fields of business and technology, neither the quality of the market opportunity nor the probability of implementation success can be estimated well for these initiatives. Therefore, transformational innovation initiatives work in an environment of high ambiguity and must generate new knowledge through "trial and error" in order to reduce this uncertainty.

      Today, the parallel use of such experiments can be observed with increasing frequency in large-scale industry - e.g. Daimler's incubator 'Lab1886' and innovation hub 'FC Think Tank' as well as Telecom's incubator 'Hub:raum' and accelerator 'Uqbate'. These different entrepreneurial innovation initiatives - so-called Corporate Venturing (CV) forms - should support the transformation strategy in different ways. Their networking and coordination, however, represent a challenge that has not yet been mastered - not to mention the question of whether and how these CV experiments actually contribute to the implementation of the transformation strategy.

      Small and medium-sized technology enterprises (SMEs) can hardly afford such broad, rather unsystematic and resource-intensive "organisational experiments" because of their typical scarcity of resources and capital. Therefore, they experiment, if at all, with individual forms - without giving guidance as to whether the chosen CV form is actually suitable for the respective objective, whether another possibly more suitable or a certain combination of several CV forms would be more target-oriented. It is therefore not surprising that SMEs are left behind by large industry in the digital transformation. To change this, the allocation of resources for transformative initiatives must be made more efficient for SMEs and suitable organisational structures must be developed.

      The motivation of this initiative is to build an innovative bridge from the first experiences of large-scale industry from experiments to implement different CV forms in the specific requirements and challenges of SMEs. This is considered to be highly relevant and significant for strengthening the competitiveness of our industrial landscape by the most important technology companies in Baden-Württemberg (large industry as well as small and medium-sized enterprises). For this reason, the applicant has already won the support of these companies (Mahle, STIHL, Bosch, Aesculap, among others), the economic initiative Baden Württemberg: Connected (bwcon) and the Chamber of Industry and Commerce (Hochrhein-Bodensee, Ulm), which is so relevant for medium-sized companies.

    • Research Team

      Project Manager

      Prof. Dr.-Ing. Guido H. Baltes, Director of the IST Innovation Institute and Professor of Strategic Management and Innovation Marketing at the University of Applied Sciences Konstanz

      Research Leader

      M. Eng. Nicolai Heinzelmann, PhD student at IST Innovation Institute with research focus on Corporate Venturing Ecosystems

    • Project Content

      The STRIVE.io research initiative focuses on strengthening the competitiveness of medium-sized technology companies in Baden-Württemberg through an effective concept for the derivation, design and implementation of a strategy-oriented portfolio of transformative innovation initiatives. The organisational implementation of such initiatives is the domain of 'Corporate Entrepreneurship', in particular 'Corporate Venturing', which deals with the development of entrepreneurial units (e.g. projects, initiatives, individuals) in established companies.

      STRIVE.io expands the capabilities of technology companies for strategic adaptation ('Dynamic Capabilities'), in particular the ability to implement transformational initiatives parallel to the established, efficient core business as a strategy-oriented portfolio of CV forms ('Organizational Ambidexterity').

      The consortium aims at the development of a process model and tools for decision support, which should enable especially medium-sized companies to derive such a CV portfolio as a systematic (budget) part of their own technology and innovation strategy (resource allocation). Furthermore, effective organizational and leadership models for the implementation of the individual CV forms are proposed. This enables at the same time to improve the efficiency of the used resources (e.g. as part of the R&D budget) and the chance-risk profile of the transformational innovation initiatives (e.g. in the sense of 'portfolio management'). STRIVE.io thus specifically addresses obstacles to the implementation of organisational ambiguity and digital transformation in medium-sized technology companies.

      The goal of the project is the development and validation of a method (STRIVE.io) for the strategy focused derivation and implementation of a CV portfolio to support the respective technology and innovation strategy.

      STRIVE.io is intended to strengthen the organizational ability of SMEs in particular, in addition to optimizing their existing core business, to expand their own competence base through the effective development of new options for action. These result from transformational innovation initiatives, implemented with CV forms. An effectively designed portfolio of such initiatives therefore enables the development of a flexible, "experimental" pool of action options that can be equated with strategic options (e.g. testing new business models, validating new technologies, building new competencies).

      An effective CV portfolio thus provides strategic options that enable a company to react more agilely and quickly to changes in the environment. In the best case, companies can anticipate these changes and thus understand the increasingly dynamic competition for innovation not only as a challenge, but also as an opportunity for growth in new business areas. Interactions and synergies between different CV forms can improve the risk-reward profile of CV activities. A suitable portfolio management not only increases the effectiveness, but also the efficiency of the resources used.

      For this purpose, existing studies on the specific suitability of CV forms will be combined and developed into a reference model for the derivation of a strategy-focused CV portfolio. In addition to the specific transformation effects, the interactions and synergies between CV forms will be analysed and evaluated. The sustainable implementation of the results is ensured by active knowledge transfer into practice. The acquired knowledge will be transferred into practice through training and coaching offers, scientific and practice-oriented publications as well as a cooperative doctorate on different levels.

    • Research Methodology

      The project methodology follows the research approach of action research, whose advantage lies in the simultaneous development of application-oriented innovation in the sense of practical solutions and theoretical findings. The logic of the project plan therefore follows two cycles:

      (1) Analysis of the requirements of SMEs

      (2) Development of suitable solutions that can be implemented and tested in practice

      The action aspect can be seen in the case studies; the learning aspect can be seen in the accompanying preparation of method and training documents as well as the discussion in expert and experiential circles.

      In the first phase, the applicant's preliminary work, the know-how of the cooperation partners and the requirements of the application companies are oriented towards the objectives.

      In the second phase, the actual innovations in the sense of the intended business solution for the strategy-oriented derivation and implementation of CV portfolios are developed in two action learning cycles. The developed contents will be discussed, evaluated and iteratively further developed in the industrial experience group of the 'SIG: Corporate Entrepreneurship' and in an expert and user panel. The findings will be implemented in concrete pilot projects by the application companies. Companies have already been identified that have documented their willingness in writing (see LOI). In the third phase, results are secured through in-depth analysis, publication and communication as well as the creation of best practice manuals.

      The project methodology is characterized by fast feedback cycles and therefore non-linear project progress. This increases the complexity of the project, since work packages are not processed sequentially, but in parallel. Active project management must be installed to coordinate partner interests and the research process.

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