Xiv) Need To Be Careful If Your New Venture Fits Your Organisational Or Common Sense

Need to be careful if your new venture fits your organisational core competencies. Three questions will help determine if the right organisational structure and channel are present on the project, ie

i) do you have the resources to succeed?

ii) will your processes facilitate what needs to be done to succeed in the new business?

iii) will your organisational values (including how you prioritise activities) enable the critical people to give the necessary priority to this new initiative when compared with other activities that compete for their time, money and talent?

There are 4 types of organisational structures (heavyweight, lightweight, functional and established) that can be used to integrate the challenges of dealing with different types of innovation with the mainstream organisation

i) heavyweight - innovation that fits with the current status of the organisation but needs new processes to handle the interfaces between the different activities and problems. This requires new types of interaction and coordination among groups and individuals, and usually involves taking people away from the functional roles and placing them in a team to tackle the new venture (with its different issues that operate across the boundaries of the functional organisation). This means that team members bring their functional expertise but do not represent their functional group's interest. For example,

"...Companies as diverse as Medtronic in the cardiac pacemakers, IBM in disc drives, and Eli Lilly with its schizophrenia drug Zyprexa have used heavyweight teams as a basis for creating different, faster processes..."

Clayton Christensen et al, 2003

ii) lightweight - organisational processes etc fit with the new venture. Thus it is possible to coordinate across functional boundaries within the existing organisation so that existing processes can be utilised

iii) functional - a disruptive technological change that fits neither the organisation's existing processes nor the way ir operates - need to create an autonomous organisation

iv) established - selling products/services in the mainstream with a fundamentally lower-end business model. These ventures can benefit from the main organisational logistic management processes that have different profiles on budgeting, management, profit and loss, etc

 

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