It takes a village to become a Pacesetter

Originally published at the IBM Center for Applied Insights blog.

Susanne Hupfer, IBM Center for Applied Insights, November 6, 2014

 

It takes a village…
– African proverb

 

I was recently reminded of the old proverb “It takes a village to raise a child” as I presented the findings of the 2014 IBM Business Tech Trends study to executives in New York City.

That saying expresses a fundamental truth that could be applied not only to raising a child, but also to building a leading and lasting organization.

In our study, we examined how Pacesetters — companies that view big data and analytics, cloud, mobile and social technologies as critical to their success and adopt them ahead of rivals — sustain their lead, even as these technologies go mainstream.

We found that one of the key characteristics of Pacesetters is their use of partnerships to stay ahead of rapidly changing markets. They not only partner more — they partner more creatively.

Pacesetters are more than 2.6 times as likely to employ start-ups for steering IT direction. They are twice as likely to involve academia to assist in product development. And they are 70 percent more likely to bring in start-ups for project execution.

What lessons can creative partnership teach us?

I wrote a few weeks ago about how creative partnerships are helping companies close the skill gap to gain much-needed big data and analytics, cloud, mobile, and social skills. This has been critical given that one-quarter of enterprises continue to cite lack of skills as a major barrier in adopting these technologies.

But creative partnerships go well beyond addressing the skills gap. Pacesetters are finding that these partnerships are vital in their ability to capitalize on societal shifts that have resulted from these technologies.

Consider the gum industry. In a recent interview with the IBM Center for Applied Insights, Gina Waldhorn, the COO of Evol8tion, talked about how mobile technology may be contributing to the losses that gum makers have experienced in recent years. Evol8tion specializes in matching major brands with start-ups to drive innovation.

Gum is often an impulse buy for consumers at the checkout counter. However, with more people on their mobile phones while waiting in line, and with more people shopping online, there are fewer “eyeballs” on the product and fewer sales.

What will gum manufacturers do and how will big data and analytics, cloud, mobile and social technologies help them regain market share? Answering these questions requires more than just tech skills, it requires a new perspective and vision, something that creative partnerships are ideally positioned to offer. In fact, Waldhorn says that brands that team with new innovators in the company’s “Mobile Futures” program aren’t just looking to adapt to today’s market realities. They’re working to envision the future of retail and use these technologies to get there.

One plus one equals three

Equally interesting, it’s not just who Pacesetters partner with, but how they partner that helps them leap-frog their competition. A recent Harvard Business Review article by Thomas Bartman highlighted the “significant power asymmetry” that start-ups might face when partnering with an established brand. Bartman’s article focuses on when it makes sense for start-ups to partner with industry leaders and the impact that these partnerships might have on the start-up’s ability to innovate.

Bartman’s discussion regarding “power asymmetry” reflects the traditional tact that many companies take when working with non-traditional partners, such as start-ups.

But what we found was that Pacesetters take a creative approach to partnering — looking to partners not just for what they can do, but how they do it. The lesson they share is that the sum is truly greater than its parts.

Mondel?z International offers an excellent example in this regard. In her interview, Waldhorn shared the story of what happened when Mondel?z International paired brand managers for nine of its brands, including Chips Ahoy!, Nabisco, and Sour Patch Kids, with nine start-ups to develop nine mobile pilot programs in 90 days.

Brand managers were inspired not only by the new mobile programs, but by the start-ups themselves. After returning to their offices, brand managers reported that they were finding ways that they could operate more like a start-up. For one brand manager, it meant eliminating “digestion points” — those lengthy bureaucratic processes typically found within large organizations — to help the brand become more nimble and responsive to customer needs.

By valuing the diversity of ideas, approaches and processes that come with creative partnerships, Pacesetters can innovate at every level — from strategy to product development to project execution.

With the dramatic market shifts that technologies like big data and analytics, cloud, mobile and social have spurred, it truly takes a village these days to raise a leading and lasting organization.

How could your organization benefit from working with start-ups, citizen developers or academia?

Listen to Gina Waldhorn’s full interview with the IBM Center for Applied Insights to hear additional insights about partnering with start-ups.