AmCham Shanghai hosted an Author Series event on November 29 featuring Trevor Owens, CEO and Founder of Lean Startup Machine and author of The Lean Enterprise: How Corporations Can Innovate Like Startups. Caroline Pan, co-chair of the Entrepreneurship Committee at AmCham Shanghai, moderated the event.
Trevor discussed the core principles for lean management, fostering start-up creativity in corporate environments, and various ways in which enterprises and startups can collaboratively work to drive growth. Owens described key principles of lean startup methodology, such as “Minimum Viable Product” (MVP), early adoptees, and the concept of pivots. Generating an MVP in a “lean” way can include interviewing target customers, pre-selling products, and creating low-tech trials.
Owens went on to explain the difference and goals of an “innovation colony” versus that of an “innovation lab.” The main goals of an innovation colony are to 1) create innovation flow (idea generation); 2) spin-out promising ideas as independent, external startups; and 3) later spin-in the best performing startups (i.e. those which have achieved product/market fit) back into the corporation as a new business unit.
Owens also shared case studies of innovation lab mis-steps – such as Xerox, which failed many times to leverage its own internal R&D, and ended up licensing or giving away technology to companies such as Apple. Eventually, Xerox created a separate entity called Xerox Technology Ventures (XTV) to help protect and fund its innovation initiatives. After just 7 years, XTV’s portfolio was worth more than Xerox itself.
After discussing the rise of corporate accelerators and other innovation labs, Owens took questions from the audience. Some of the questions centered around: the differences between the principles taught by Trevor vs. Eric Ries, author of The Lean Startup (Trevor’s book offers more practical tips and is focused on incorporating lean startup methodologies into the enterprise context); spin-out and spin-in needing to be sequential vs. two options post-MVP (Trevor’s opinion was that sequential was more successful); and a conversation around the need to continually re-educate corporate executives to better understand lean management, generate more opportunities for creativity, and create more rewards as incentives.