Business Model Innovation in Large Organizations

Lean innovation lets you manage an organization that continuously improves its business model while improving current business.


Jul 27, 2015

Established companies face a lot of inertia when it comes to business agility and adopting new business models. Steve Blank points out the benefits of adopting lean innovation to allow fast, safe, and cheap experimentation so established companies can continuously improve their business and adapt to new circumstances.


Companies at times get locked into an existing business model and build a ton of processes, procedures, key performance indicators, incentive programs etc. to optimize execution. But it doesn’t make them very agile. In fact all those rules, regulations, and processes in fact make companies not agile. It says here's the spec and we’re not going to get smarter than this.

There is a way to take these innovation techniques and build a organisation that’s doing continuous improvement, whilst still serving existing customers, but learning from those customers about how to build a better product, or service, or channel or resources just serving the existing business model.

So lean innovation does two things, it allows you to improve your current business but it also allows you to explore radically new business models not on your current plate, without insisting that all of them be you know $100 million experiments. It allows you to actually do experiments cheaply, efficiently in a short amount of time in one section of the company while also improving the processes and procedures and deliverables for the core business.

Published Date: Jul 27, 2015

Author: Michael Krigsman

Episode ID: 218