Business Model Innovation and Large Companies

Companies must learn to balance operating an existing business with cultivating innovation spaces. This is especially true for large companies.


Jul 02, 2015

Alex Osterwalder talks about how large companies can execute an existing business model and set up innovation spaces. The execution side and innovation side must partner with each other. This partnership must strike the right balance between how loosely or tightly coupled to make this relationship. 


What large companies really need to realise when they address this topic of the business model change, business model innovation is it’s not bad to have an existing business that makes money and you know it might be at the end of its life cycle, but you want to continue execute that.

What they need to do is create an innovation space, which is in addition to what they already have, and in that space the rules are totally different. So what they need to realise is that incentives are different. Processes are different. The type of people you are going to need are different. So, you need to create that second space to be able to innovate and here’s the hard part.

That second culture, that second space needs to be deeply integrated with the execution space – the execution engine as some like to call it. It needs to be a partnership, you need to have a dual culture that works hand-in-hand. That’s very tough to do.

Published Date: Jul 02, 2015

Author: Michael Krigsman

Episode ID: 124