The Plot and the Subplot

Building an incubator is, by definition, trying to make something new successful—something totally different from anything you’ve done before. It’s not the sort of thing you use for minor changes to your product, which would call for more traditional approaches like a new product launch. Every incubation journey has a plot and a sub-plot.

The plot is what most people are aware of. The plot is that you’re building the business, you’ve got to get to X million in a certain period of time, you need to build market share, you have to reach and achieve a specific profit contribution, and so forth. That is the plot—building the business. It’s your basic underpinning, and it’s what you need at the core. But because you are doing something very different from the rest of the organization—something that sets you apart, makes you stand out—you will be agitating the rest of the organization.


For example, if you sold capital equipment in the past and now you are trying to sell your services as a pay-per-use model, you will most likely be fighting a battle on two fronts. One is in the market, where you’re trying to get whatever innovation you created to be accepted and adopted so you can actually get paid. On the other hand, you have an internal fight; in this case, it might be with financial and legal issues (e.g., revenue recognition), you might fight with your installation team because the skills required to integrate the new solution are very different from what it took in the past. People on the incubation team often forget that. They often just focus on the plot—on making the business successful—and then get frustrated by all the internal barriers and hoops they have to jump through (or rather, that they are made to jump through by other parts of the organization). What I try to offer is the perspective that this is only 50% of your job. If you take part in a business incubator, you have to be prepared to fight those internal battles, because you are not only building a new business, but you are transforming and changing your own organization as well.

I often talk about strategic business incubators as transformation engines or change catalysts. And by the way, I am not at all a fan of top-down change management approaches, because I think they are very, very expensive and usually aren’t effective and sustainable in the long run. If an executive wants to transform his or her organization to be successful in the future, creating any number of strategic business incubators is a wonderful tool to do so. You transform the organization from the inside out, and you do it with a focus on an external reference: a customer problem. There is nothing that drives transformation so well and is as effective at solving customer problems while simultaneously requiring the organization to behave, collaborate, and think differently, and that is exactly what happens in a strategic business incubator.

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