Accelerated radical innovation — The execution side lessons from a seed-stage technology incubator

The Accelerated Radical Innovation (ARI) Methodology is an integrated approach to shepherding radical innovation from initial vision through commercialization and integration into the economy within acceptable levels of risk, cost, and schedule. Extending over the full life cycle of the innovation, the methodology encompasses two major periods, an inception period (identification and assessment of four key challenge areas, comprehensive intelligence gathering and analysis leading to a detailed system vision of the innovation), and an implementation period (execution on the system vision through full commercialization). Most of the ARI methodology development to date has focused on the analytical aspects of the inception period. This paper focuses on the post-vision execution period. To understand how execution is successfully carried out in practice, the authors conducted a detailed study of an investor-funded seed-stage innovation incubation firm (ConduIT Corp.) and four of the seed-stage companies in its portfolio. Six factors were found to underlie ConduIT´s success: (1) careful culling of innovation concepts for evidence of market need, manageable technical risk, and alignment of business interests; (2) an ultra-lean operating model to improve survivability through the innovation´s ldquovalley of death;rdquo (3) creation of a business model to assure profitable commercialization; (4) internally provided coaching and professional services by ConduIT´s principals; (5) strict accountability based on attainment of milestones; and (6) concentration within ConduIT´s defined ecology (health care IT, digital media, and Web-based applications) so that its expertise and network can be used to greatest effect. ConduIT´s experience offers five important lessons for radical innovation. First, an extended process of experimentation with products, strategies, and business models is needed. Second, early infusions of capital can create premature, counterproductive financia- l pressures on the innovator. Third, on the contrary, ConduIT has demonstrated that the early-stage experimentation process can be accomplished at a low burn rate (the ldquobootstrappingrdquo approach), allowing fundamental concepts of the business to gel. Fourth, at the earliest stages of a technology enterprise, a large dose of improvisation in unavoidable. Last, the bootstrapping model forces innovators to go directly to the source of problems (rather than papering over them with cash), leading ultimately to a more agile, resilient, survivable enterprise. The lessons offered by ConduIT are incorporated as best practices into the ARI methodology.