By Milan Kocic, Founder and Head of Sixth Sense, Hexagon’s Manufacturing Intelligence division
We’re living and operating in a very complex world. For companies of all shapes and sizes to meet customer needs, they must constantly innovate.
However, many businesses across the world are facing challenges – supply chain issues, rising inflation, and the war in Ukraine have severely impacted the way a lot of companies operate.
The rising costs of materials and labour can cause a headache for start-ups that have ambitions of scaling but are operating on a limited budget. Larger corporate companies, meanwhile, are less inclined to push ahead with exploring new disruptive technology – as this kind of innovation needs capital and can be deemed as a risk to the bottom line.
Despite this, businesses of all sizes must continue to innovate and push the boundaries. In 2023, and beyond, companies will be forced to think outside the box.
In particular, this is forcing larger companies to re-evaluate their approach to innovation. Instead of seeing start-ups as rivals coming along to disrupt the industry, can a business leader re-assess and see if there’s a way that the two businesses can work together for mutual benefit?
Building a network of start-ups and corporates
The idea of working together with a potential rival – seeing them as ‘co-opetition’ rather than competitors – is not necessarily a new one. However, it hasn’t always been done in the right way.
Around a decade ago we started to see accelerators and incubators pop-up in corporate settings. However, many simply forced two businesses together under the naïve assumption that matching a budding start-up with a big corporate will create magic. Many failed because there simply wasn’t the right framework in place for success to thrive.
What the industry learnt was that for collaboration to truly take-off, we needed to be deliberate about it – why are the two companies collaborating, is it ‘investable’ for both the corporates and start-ups, and do their objectives align? And, does the bigger company have the processes in place and the capacity to proactively interact and support with start-up.
With businesses around the world facing challenging economic conditions, now is the perfect time for start-ups and corporates to once again start to collaborate. However, we must look to take the lessons from the last decade and put in the right frameworks to ensure that these types of partnerships thrive and that progress is accelerated.
By taken an open innovation approach and creating an ecosystem that joins start-ups with the world’s biggest companies, it is possible to turn real-world problems into transformative solutions and share valuable resources.
It’s a win-win for both sides.
Larger corporates have the tools available to help start-ups scale quickly – access to cutting-edge technology, a global sales network and existing relationships with other big businesses, and potential funds for R&D investment. In turn, corporates get to benefit by working with passionate start-ups with disruptive ideas and an agile approach to innovation.
Building a sustainable future, together
This approach to innovation will be fundamental in tackling the world’s biggest problems going forward.
Over the coming years, companies will need to slash carbon emissions, become more efficient, and adapt to the workplace evolution currently taking place. This kind of rapid, disruptive innovation will only be possible by companies working together and putting the building blocks in place so that the brightest minds can thrive.
The aims of a collaboration should be simple – boost performance and benefit people and the planet. By inviting the next generation of innovators to the table, larger corporates can share resources and make connections that accelerate progress – pushing the boundaries of design, manufacturing and engineering.
Scaling the big ideas
Businesses around the world do face big hurdles when it comes to accelerating innovation and shifting towards a sustainable future. The economic and supply chain issues are likely to rumble on, while skills shortages, rapidly changing regulations, and evolving customer demands will create further headaches.
To overcome these big hurdles we will need to scale big ideas, and start-ups, by their very nature, are populated by big ideas. If larger companies can use their significant resources, tools and expertise, to help grow these ideas into viable solutions for the global market, everyone will benefit. The start-up will grow, the larger business will have access to new innovations and, most importantly, the customers will be provided with better, more innovative, products.