045: Why Startups and Big Companies Struggle to Innovate with Steve Blank

The Lean Startup movement is integral to the foundation of modern entrepreneurship. Despite its proven success there are still many businesses, including both startups and established companies, that struggle to apply Lean principles and continue to build products through the waterfall approach. In today’s episode, we are joined by Steve Blank. In addition to being an author, entrepreneur, and professor, he is also widely recognized as an early father of the Lean Startup movement. In our discussion, Steve reflects on the current state of innovation in startups and enterprises and what can be done to improve it. Hear what it means to be an ambidextrous organization and why Steve holds it in such high regard. As we dive into the premise of Lean, Steve explains why on your first day as a startup, all you have is a series of untested hypotheses, whereas for an established organization the departure point is from a series of knowns. Later we discuss the concept of innovation theatre and why it’s more prevalent in established companies. Listeners can also expect to hear why the same processes for innovation that do well in startups, don’t work well for large organizations, largely because they are designed to minimize risk. Steve also shares examples of how the VP of sales can undermine innovation and why senior leadership in large organizations generally needs a lot of reform. We were honored to have Steve on the show and had a highly engaging and informative conversation that we know you’ll enjoy!

 

Key Points From This Episode:

Meet today’s guest Steve Blank.

The current state of innovation in startups and enterprises.

What it means to be an ambidextrous organization. 

Every company needs to be able to execute and innovate concurrently.

Steve compares how the startup landscape has changed from when he started.

Why startups still tend to have a technology-first approach, rather than customer first.

The departure point for the premise of lean is that on your first day as a startup all you have is a series of untested hypotheses.

In an established organization the departure point is from a series of knowns, like your existing customer needs, your supply chain, etc.

Why founders are often too certain and why it’s a problem.

Finding a repeatable and scalable business model as a startup.

A discussion on the concept of innovation theatre.

Steve shares an anecdote explaining the ‘cargo cult’ to illustrate how large corporations misjudge what it means to have a lean approach.

Why large organizations can withstand innovation theatre for longer than a startup.

The same processes that do so well in startups for innovation don’t work for large organizations because they are designed to minimize risk.

Large organizations are not designed to innovate with speed and urgency.

With innovation, you want to take reasonable risks.

Why senior leadership needs to be reformed.

How the VP of sales can undermine innovation in a company.

When you have a disruptive innovation inside your own company you need to protect it from certain heads of department.

How Steve describes an innovation doctrine or an innovation pipeline and how to construct and adopt it.

 

Links From Today’s Episode:

Steve Blank

Steve Blank on LinkedIn

Steve Blank on Twitter

Daniel Elizalde

IoT Product Strategy Template