New roles for innovation inside large businesses by Alex Osterwalder

The traditional corporate rewards managers for reliability: managers get promoted for reaching targets. This model works well for execution but does not work well for experimentators and innovators. As a consequence, companies forget to innovate and loose their competitive edge. Corporates therefore have to change, and the introduction of new roles can help make this change happen. Luckily Alex Osterwalder, co-inventor of the business model Canvas has a solution in the form of three new roles.

Alex Osterwalder is one of the investors on the business model canvas: a one page alternative for the oldfashioned business plan. He was in The Netherlands as a keynote speaker for Canvas The Game, an an event organized by Business Models Inc, where game companies created serious games that help people understand their business model. Alex gave a keynote speech about his experiences with business model mechanics and the innovation challenges of large corporations. One of the topics he covered was innovation inside existing business. (photo: Alex Osterwalder (left) in discussion with host Rens de Jong).

One of the challenges that he sees for large corporates is to create the right environment for entrepreneurs and innovators inside large coporates. Large corporates still work with business plans, which are really plans to be executed. Strategy departments create the plans once, and managers execute these and get rewarded for meeting the numbers.  The experimentators inside large corporations are often measured in the same way as the regular employees, and since their experiments are not predictable they will often miss their targets. Eventually the innovators will leave and start their own company, because their career options inside the company are limited.

Companies that want to foster innovation have to change this model, and one way to do this is by introducing new roles. Instead of the traditional CEO, CFO and COO, they need a new structure that supports innovation just as much as execution. Alex proposed three new roles that every company should have:

• The CEO: Chief execution officer: this person is in charge of running the business models that work effectively
• The CCE: Chief Corporate Entrepreneur. This person is in charge of inventing new business models in order to keep the company competitive
• The CIA: Chief Internal Ambassador: Alex originally called this the corporate concierge, but some-one from the audience suggested CIA as a cooler, better name. The CIA helps the entrepreneurs with access to the corporate resources.

The new structure solves two major problems. First of all it provides a career path based on innovation and entrepreneurship: people do not have to become traditional managers in order to progress. Secondly the new structure should help startup-like teams inside large organisations benefit from the corporate resources. This should help them compete with the startups that are not hindered by corporate red tape.

Besides the keynote speech by Alex Osterwalder, Canvas the Game also featured a competition for game companies to make a game out of the business model canvas in 55 hours. Seven teams worked round the clock to make several serious games based on the business team. In the end, Ranj won the prize for their simulation game.

About the author: Sieuwert van Otterloo (twitter: @entreprenl) is cofounder of research and advisory firm Inbys. He gives advice about innovation, startups and software.