The five key considerations when using a start-up approach with a large enterprise

Sacred cows can be challenged and problems that you already thought had been solved can be solved better. It takes a certain type of approach to make it work, but the same approach applies equally to large businesses, writes Cade Witnish.

 

Australian start-ups are seldom profitable ventures in the short-term. Often, the founder’s vision is focused on the big picture and the prospect of long-term gain. Start-ups have a way of making more work for less by virtue of the fact that most are cash poor. They are forced to find rather creative solutions to problems and often this means streamlining processes and thinking well outside the square.

For those operating an agency, working with a start-up as a client can bring all sorts of challenges and opportunities. As an agency we find ourselves pushing the boundaries in terms of finding new ways to approach things and helping a start-up stand out from the crowd. This means challenging sacred cows and focusing on solving problems that you already thought had been solved.

The fact is, we’ve learnt that it takes a certain type of approach to make it work, one that is not limited to start-up incubators but can be effectively utilised when working with large enterprises too.

 

The five key considerations when using a start-up approach with a large enterprise

1. Use proven results

Acting with the mindset of a start-up doesn’t mean ‘let’s keep it loose and eat pizza all day’.  The start-up approach, when it works, comes from classic business fundamentals i.e. let’s keep waste to a minimum, let’s be unafraid to learn from our mistakes, and make a product that our users love even more tomorrow than they do today.

2. Team dynamics

We have success using a lean start-up approach with our larger clients when we work as a small group, kind of like a SWAT team within a much larger company. Small groups can make big decisions quickly; big groups can take years to make small decisions. You also have to account for the personalities of your team. Often people are attracted to work with larger organisations because they value things like security, stability and predictable results. The lean start-up approach, which thrives on candid and constant communication, ideas and passion all demanding problems be thrashed out quickly and precisely, can freak them out.

3. Business scaling must equal innovation scaling

When you see larger enterprises fail, it’s often because they’ve scaled without also scaling innovation. Research in Motion is the classic example. In just a few years they went from being the clear market leader to reactively following the market.

Likewise Blockbuster went from ubiquity to bankrupt for the same reason – Netflix was innovating so fast that by the time Blockbuster got it’s head in the game it only had one play to make… and it failed.

Large enterprises cannot afford to stop innovating.

4. The biggest competition may also be the smallest

The concept of risk is becoming harder and harder to manage. Start-ups really have nothing to lose – they’re a moon shot from day one and once they gain momentum, everyone falls in love with their story. Businesses are quickly realising that the biggest risk to a company is not a handful of negative tweets or some bad press, but rather the handful of tiny competitors you don’t know about who are surviving on ramen noodles and Dr Pepper; their entire lives dedicated to making your entire business model obsolete in two years.

5. Versions and iterations

We find that our larger clients often want to spend the entire budget on the first execution of a campaign. We try to advise against spending months planning in advance and leaving no room for adjustment after go-live. Being smart about trimming back functionality to make the product a cleaner solution and looking at integrations after launch can be the difference between a project getting off the ground or not.

Even small iterations or insights can dramatically improve conversions. Recently, we had a project where changing the homepage image doubled sign-ups instantly. So we now work in versions, which is essentially just our way of saying, ‘this is the best we can do for what we know now, and that may change.’

Ultimately, I believe that it’s actually a misnomer that the culture within larger organisations stifles innovation. Bad leadership, not the size of a business, is what stifles innovation.

 

Cade Witnish
BY Cade Witnish ON 25 July 2014
Cade Witnish is managing director of Loud&Clear, a company he grew from a startup of three employees to 45 employees. He is a co-founder of FanHub Media, a Loud&Clear joint venture building the official AFL and NRL fantasy games, AFL Fantasy Punt and the Official NRL Match Centre, and oversees the Loud&Clear Group of joint ventures including BoxSuite, Sidekicker and Designer Websites. Prior to founding Loud&Clear, Cade garnered over 10 years experience in sales and marketing within the pharmaceutical and medical devices industries. Connect with him on cade@loudclear.com.au.