Our guest had just joined IBM from McKinsey and was assigned as an internal consultant charged with supporting these nascent businesses.
We are about to hear that story and so much more.
It is a pleasure to welcome the author of “The Corporate Explorer: How Corporations Beat Startups at the Innovation Game” Andrew Binns
O’Reilly and Tushman illustrate how leaders can align their organization’s cultures to fit the needed strategy and how ideation, incubation, and scaling approaches, when used all together, can successfully develop new growth businesses.
Businesses throw Hail Marys when encountering a crisis, such as declining sales or disruptive innovation, or technology suddenly upends their business plan. Equally, leaders throw Hail Marys to meet analyst expectations when they have been coasting in the game for a long time. In sports, there is a thin line between arrogance and confidence, and business organisations often fall into the success trap.
In part 2 of our Tushman and O’Reilly series, Charles O’Reilly III explores the importance of cultural alignment in encouraging change. We focus on the cases of DaVita, Microsoft and AGC.
In today’s business world of flux, explore units are agile, decentralised, experimental cultures, loose work processes, strong entrepreneurial and technical competencies, and relatively young and neurodiverse employees. In contrast to the exploit units, these small entrepreneurial units are inefficient, rarely profitable, and have no established histories. They often deliberately violate the norms valued in older parts of the organization.
Because the explore units are wildly different from the exploit incumbent, explorers are often undermined by the parent company, whose short-term needs override exploration. While the exploit teams win in the short term, they sink the company in the long.
For Part 1 of our series on Tushman and O’Reilly, we welcome the author of the 1997 classic: “Winning Through Innovation: A Practical Guide to Leading Organisational Change and Renewal”, Professor Michael Tushman.