Pivot How Top Entrepreneurs Adapt and Change Course to Find Ultimate Success

Every day, business and corporate startups take action based on assumptions. Yet these assumptions are based largely on guesswork that leads to everything from costly mistakes to the failure of ventures. Fortunately, there are ways to overcome these issues and excel in your business endeavors?and this book will show you how.

Engaging and informative, Pivot provides entrepreneurs with practical guidance for achieving success in corporate ventures as well as new startups. Based on more than fifteen years of academic research and many more years of experience in business and corporate startups, this book skillfully addresses topics ranging from resources and organizational uncertainties to the scope and scale of new business opportunities.

• Reveals how to successfully conceptualize new business opportunities, pivot as required to experiment with these opportunities, and accelerate to the marketplace
• Captures the capabilities needed to quickly build a business by understanding and systematically reducing uncertainties from market landscape and technology to talent and organizational positioning
• The digital component of this book includes a world-class strategic innovation methodology that is in demand from corporations worldwide

Written with today's serious entrepreneur in mind, Pivot will provide you with the tools you'll need to get ahead of the competition and achieve consistent success.

List of Trademarks xiii

Acknowledgments xv

Introduction: Is There a Better Way? xix

PART I THE TALE OF TWO

ENTREPRENEURIAL WORLDS 1

CHAPTER 1: Pedal to the Metal 3

A Little History 3

Traditional Management Tools Fail Entrepreneurs 4

Why Startups Fail 7

Origins of the Pivot Methodology 8

Notes 10

CHAPTER 2: Innovation is Bringing Discipline to Chaos 11

Plant = Discovery; Pivot = Incubation; Propel = Acceleration 11

Introduction to the D-I-A Model 13

If Only I Had Known Then What I Know Now. . . 15

Innovation Defined in the Corporate Setting 17

Beyond Invention and Creativity 18

Emerging Management Discipline 19

Innovation Definitions 21

Common Language and Mind-Set 23

Navigating the Culture Divide 24

It’s All about Uncertainty 25

Uncertainty versus Risk 25

Uncertainty Types: Technical, Market, Resource, Organization 26

Innovation Continuum and Uncertainty 27

The ABCs of Innovation Uncertainty 27

Notes 29

CHAPTER 3: The Corporate Entrepreneur 31

An Examination of the Definition 31

An In-Depth Look at Corporate Entrepreneurship Models 33

Model One: Intrapreneurship 34

Model Two: Arm’s-Length Approaches—Corporate Venture Capital and External Corporate Incubators 35

Model Three: Internal Venturing—Spin-Ins and Spin-Outs 36

Model Four: New Business Creation—Inside Corporate/R&D or Established Divisions 38

Model Five: Open Innovation Hybrid Approach 39

Model Six: An Innovation Function—Institutionalizing Corporate Entrepreneurship 40

A Brief Look at Academic Research 42

A Look at Corporate Culture 43

Personal Experiences 46

Notes 52

Additional Notes 53

CHAPTER 4: So, You Want to Be an Entrepreneur? 55

Swinging for the Fences 56

The Academic Side 59

Personal Experiences 63

Notes 67

CHAPTER 5: Entrepreneur and Corporate Entrepreneur: Framing the Perspectives 69

Comparing Entrepreneurs 71

Differences between Entrepreneurs and Corporate Entrepreneurs 71

Differences in the Operating Contexts 72

Progress in Understanding and Effectively Executing the Two Different Types of Entrepreneurship 74

Notes 76

PART II PLANT = DISCOVERY—THE BUSINESS VISION 77

CHAPTER 6:Discovery–Attractiveness of the Business Opportunity 79

Discovery Principles 81

Discovery and Open Innovation 83

Discovery Progression: Capturing Innovation Opportunities 85

Opportunity Recognition 85

Application Generation and the Business Vision 89

The Discovery Toolkit in Brief 92

Standard Tools 93

Idea Uncertainty Assessment Tool 93

Genesis Pad Opportunity Description 93

Opportunity Screening Criteria 96

Opportunity Potential Questions 97

Uncertainty Identification Checklist for Discovery 99

Opportunity Stakeholder Positioning Steps 99

Plant or Discovery Value Pitch 99

Advanced Tools 104

Words of Caution 107

Plant Your Value Pitch: Making the Transition to Incubation with Your Opportunity Concept 107

Notes 109

CHAPTER 7: Opportunity and the Entrepreneur 111

Opportunity Recognition 112

Technology to Market Opportunity 114

The Challenge for Universities to Commercialize Technologies 116

The Big XYZ 118

The Value Proposition 119

The Positioning Statement 121

Notes 122

CHAPTER 8: Entrepreneur and Corporate Entrepreneur Perspectives: Pursuit of Opportunities 123

Getting from Idea to Opportunity 123

Attracting Attention 125

Note 127

PART III PIVOT = INCUBATION—THE MISSING LINK 129

CHAPTER 9: Incubation—Discipline Together with Chaos 131

Incubation Principles 133

Incubation Objectives 136

Incubation Activities and Processes 137

Incubation and Living With Chaos: The Learning Plan 142

Short, Quick, Inexpensive Learning Loops 143

The Learning Plan Methodology 144

Dimensions of Uncertainty 148

Learning Loop Development Process 152

Initiating a Learning Loop 152

Evaluating Learning Outcomes 153

General Guidelines 153

Notes 155

CHAPTER 10: Early Market Engagement: Business Concept Options 157

Incubation Progression: Market Learning and Business Model 158

Market Learning 160

Business Model 164

Market Development Considerations 166

Learning versus Product Prototype 166

Market Entry Approach 167

Forget about Finding the Killer Application 167

Be Out There 168

Move from Office to Market 168

Market Development = Market Learning 169

Follow the Long and Winding Road 169

Innovation Roles 169

Building the Team 169

Success Depends on People 171

The Incubation Toolkit in Brief 173

Standard Tools 173

Learning Plan Design Template 173

Uncertainty Identification Checklist for Incubation 174

Technical and Market Concept Testing Approaches 174

Technical and Market Concept Testing Outcomes 176

Genesis Pad Solution Description 176

Transition Readiness Questions 177

Pivot or Incubation Value Pitch 179

Advanced Tools 180

Learning Approach Value and Coaching Requirements 182

Accelerated Learning to Achieve Faster Results 182

Consistent and Timely Coaching Required 184

Pivot to Your Evolved Value Pitch: Making the Transition to

Acceleration with Your Concept Proposal 185

Notes 187

CHAPTER 11: Business Experiments 189

Knowledge Construction 190

Define Assumptions 194

Define Markets 196

Define CTA and Analytics 198

Define Product 200

Note 201

CHAPTER 12: Validated Learning = Knowledge 203

Business Model 204

Start Executing Experiment 206

Execute: Product, Market Group, and Call to Action (CTA) 207

Execute: Assumptions and Analytics 208

Execute: Confidence, Results, and Knowledge Loop 209

Business Plan 212

Notes 216

CHAPTER 13: Entrepreneur and Corporate Entrepreneur Perspectives: Incubation and Hypothesis-Driven Learning 217

Learning Is the Antidote to Uncertainties 218

Learning How to Learn 219

Pivot Startup Methodology and Learning Plan 220

Making the Case for Investment 221

PART IV PROPEL = ACCELERATION—THE BUSINESS RAMP-UP 223

CHAPTER 14: Acceleration—Courage to Invest 225

Acceleration Principles 226

Moving from Uncertainty to Risk 226

Moving from Experimentation to Development 227

Acceleration and the Phase Gate Process 228

Integrating with Product Development 229

The Acceleration Toolkit 232

Standard Tools 232

Resource and Organization Alignment Plan 233

Market and Technology Development Integration Plan 233

Propel or Acceleration Value Pitch 235

Advanced Tools 235

Propel Your Value Pitch: Making the Transition to Operations with Your Business Plan 236

Notes 237

CHAPTER 15: Preparing for Growth 239

The Startup Ecosystem 241

University Ecosystems 244

A Time to Scale 246

Notes 249

CHAPTER 16: Entrepreneur and Corporate Entrepreneur: The Challenges of Growth 251

The Ecosystem 252

The Laws of Diffusion and Resistance 253

Scaling 255

Balancing TMRO 256

About the Authors 257

About the Academic Contributing Authors 261

About the Companion Websites 265

Index 267

Remy Arteaga has more than twenty years' experience in entrepreneurial, innovative, and strategic roles. Remy began his career with GM, where he was part of an internal consulting group, the sole mission of which was to change the way GM did business. There, he developed ideation, customer needs, and competitive analysis business methods that were deployed throughout the company. Following GM, Remy spent several years as an IT consultant before launching his first startup. Over the next 20 years, Remy started up five successful startups in varied industries, from medical devices to software. As COO and founder of Extreme Interactive Media, Inc., he built the company into the top competitor in its media space. In 2007, Remy was named CEO of DualAlign LLC, an Albany, New York–based technology startup focused on computer vision software solutions. Most recently, Remy served as the Program Director of the Entrepreneurship Center at Rensselaer Polytechnic Institute.

Joanne Hyland is President of the rInnovation Group (rInnovation) and former Vice President, New Venture Development, at Nortel Networks. As a Founding Partner in rInnovation, Joanne works with major corporations across diverse industries in the U.S., Canada, Denmark, Germany, and elsewhere to link innovation with strategy and to develop systems, leadership and culture capabilities that drive growth and corporate renewal. Joanne speaks regularly on topics related to innovation and corporate entrepreneurship and is/has been a member of the MBA and executive education faculties at Babson College, the Business Institute in Denmark, the Danish Technical University, MIT, Rensselaer Polytechnic Institute, Stanford University, and the Tata Management Training Center. At Nortel Networks, Joanne and her team founded its internal venturing program, a multimillion-dollar investment fund that resulted in twelve business startups, one of which, Bill Me Later^®, reached close to a billion-do