Lean Scaleup™

Three Interlocked Capabilities
To Build New Businesses
From Innovation.

Lean
Scaleup™

Three Interlocked Capabilities

Generate New Business

from Innovation.

The Lean Scaleup Framework

Proven Success Formula.

Proven Success Formula.

Leading companies know which buttons to push to win in innovation.

Leading companies know which buttons to push to win in innovation.

Methodology

Methodology

Lean Scaleup Methodology How To

Validate "Worth to be scaled" and "Ready to be scaled"

Ideas and concepts are cheap. Scaling-Up is expensive. Only concepts that are “worth to be scaled” and “ready to be scaled” should be scaled up.

The Lean Scaleup helps in validating if the corporate startup/venture has a solid business foundation and a robust business strategy.

It also provides the guardrails on how to design a business with scalability in mind and supports validating “ready to be scaled.”

In the technical track, the Lean Scaleup tells you how to advance the product or technology in parallel to the commercial track so that the product and the business are built at the same pace.

Define the pathway to Scaling-Up

There are five generic options for the organizational set-up for Scaling-Up.
Corporate startups can scale up inside an existing business unit, inside the company in a specific department (e.g., a “New Business” business unit), in a dedicated “Scaling-Up function” or outside the company, with company staff or outsourced to a “Venture Builder.”

Depending on the specific situation of the corporate startup/venture, not all pathways are equally suited. Selecting the path that offers the best chance to generate a large and sustainable new business is a crucial ingredient for Scaling-Up success.

Build the launchpad for Scaling-Up success

Turning a corporate startup with a few customers into a multimillion business within a few years means hypergrowth.

Of course, it is not possible to anticipate all the activities of Scaling-Up. But the better the mission-critical areas are defined, the higher the chance to have some stability in Scaling-Up and to get the most of the collaboration between Core and scaleup.

The Lean Scaleup provides help in identifying these areas and in developing a robust Scaling-Up plan.

Having the right funding and governance is also a key factor for Scaling-Up success. Based on the Best Practices of leading companies, the Lean Scaleup uses the same approach as the ones from the most successful Venture Capital firms.

Transition from Validation to Scaling-Up

When validation has shown that a corporate startup/venture is “worth to be scaled” and “ready to be scaled,” the transition into Scaling-up needs careful consideration.

The Lean Scaleup helps in working through the issues. Among them are, e.g., building an outstanding Scaling-Up team, pressure-test fundamental “ready to be scaled” assumptions, and establishing product ownership.

Additionally, the collaboration model for how Core and scaleup should work together during Scaling-Up needs to be defined in this transitional phase.

Validate "Worth to be scaled" and "Ready to be scaled"

Ideas and concepts are cheap. Scaling-Up is expensive. Only concepts that are “worth to be scaled” and “ready to be scaled” should be scaled up.

The Lean Scaleup helps in validating if the corporate startup/venture has a solid business foundation and a robust business strategy.

It also provides the guardrails on how to design a business with scalability in mind and supports validating “ready to be scaled.”

In the technical track, the Lean Scaleup tells you how to advance the product or technology in parallel to the commercial track so that the product and the business are built at the same pace.

 

Define the pathway to Scaling-Up

There are five generic options for the organizational set-up for Scaling-Up.

Corporate startups can scale up inside an existing business unit, inside the company in a specific department (e.g., a “New Business” business unit), in a dedicated “Scaling-Up function” or outside the company, with company staff or outsourced to a “Venture Builder.”

Depending on the specific situation of the corporate startup/venture, not all pathways are equally suited. Selecting the path that offers the best chance to generate a large and sustainable new business is a crucial ingredient for Scaling-Up success.

Build the launchpad for Scaling-Up success

Turning a corporate startup with a few customers into a multimillion business within a few years means hypergrowth.

Of course, it is not possible to anticipate all the activities of Scaling-Up. But the better the mission-critical areas are defined, the higher the chance to have some stability in Scaling-Up and to get the most of the collaboration between Core and scaleup.

The Lean Scaleup provides help in identifying these areas and in developing a robust Scaling-Up plan.

Having the right funding and governance is also a key factor for Scaling-Up success. Based on the Best Practices of leading companies, the Lean Scaleup uses the same approach as the ones from the most successful Venture Capital firms.

Transition from Validation to Scaling-Up

When validation has shown that a corporate startup/venture is “worth to be scaled” and “ready to be scaled,” the transition into Scaling-up needs careful consideration.

The Lean Scaleup helps in working through the issues. Among them are, e.g., building an outstanding Scaling-Up team, pressure-test fundamental “ready to be scaled” assumptions, and establishing product ownership.

Additionally, the collaboration model for how Core and scaleup should work together during Scaling-Up needs to be defined in this transitional phase.

 

Lean Scaleup Methodology How To

Dual Leadership

Dual Leadership

Lean Scaleup Dual Leadership
Lean Scaleup Dual Leadership

Build the ambidexterity mindset

Past success lures some people into thinking that tomorrow will be pretty much the same as today.
Most leaders are aware that tomorrow will be different from today.

They ponder a big question: Should I focus on making the numbers, often at the expense of the company’s future? Or should I prioritize longer-term strategies over quarterly and annual performance?

True leaders do both. They demand from their management team to own the business, short-term and long-term.

They work with them and align them on a clear picture of where the business model and the operating model need to be in 3-5 years. They share a “picture of the future,” if you will.

They establish a clear and broadly accepted mandate for corporate innovation of what it has to deliver – and which support it will receive.

Decide on a few big bets and their growth strategy

In many large companies, a new business’s initial impact is minimal compared to the balance sheet’s size. Leadership may be inclined to use Scaling-Up’s funding instead for initiatives that promise a multiple of the new businesses’ revenues with a lower risk.

The paradox is that there is no proof that the brilliant idea can be the foundation of a billion-dollar business before someone else has built it – but then it is probably too late.

The trick is to arrange a sequence of small bets that eventually build and prove the big ambition.  If, for instance, the company assumes that customer expectations are shifting towards service-centered business models, the best route for the company might be to launch corporate startups where each builds “a piece of the puzzle.”

In Scaling-Up these corporate startups, a priority decision needs to be made: Is it more important to create a new business or support Core first? Leading companies do both: they scale up their corporate startups/ventures so that Core profits first but keep an eye on building an external business – while using the Scaling-Up journey inside the company to mature the products and sharpen the value proposition.

Create a supportive environment

There is an “Us and Them” between the Core and the innovation units in too many companies. The one side speaks of “innovation theater” while the other side complains that “they don’t get innovation.” It is not helpful to have these conflicts. And when a particular scaleup gets in-between a rock and a hard place, success is in danger.

Leading companies understand this. Their leaders establish an effective “ground control” – like in the classic movie “Apollo 13”. There are three men in a small capsule, exploring new territory, running into unforeseeable problems – and NASA on the ground with all its resources and constant communication helping these men solve their problems.

Leaders create mutual understanding between the two sides, Core and scaleup. They engage in a meaningful way. And they help to find the best solutions for the harsh prioritization reality. i.e., splitting precious resources between running today’s and building tomorrow’s business.

Manage a blend of cultures

Leading companies found that three Playing Fields need to be managed concurrently to win in innovation. First, the incremental innovation space; second, the space in which radical/disruptive innovation is created and accelerated; third, the middle ground, where radical/disruptive innovations are scaled up and Digital Transformation plays out.

These Playing Fields are not just “three horizons.” They have distinctive success factors, operating models, and cultures.

Leaders who understand innovation recognize this. They nourish a blend of cultures – especially at transitional interfaces – instead of taking sides. For instance, they encourage the interaction between staff from the various cultures, and they also encourage secondments from Core into scaleups.

Build the ambidexterity mindset

Past success lures some people into thinking that tomorrow will be pretty much the same as today.
Most leaders are aware that tomorrow will be different from today.

They ponder a big question: Should I focus on making the numbers, often at the expense of the company’s future? Or should I prioritize longer-term strategies over quarterly and annual performance?

True leaders do both. They demand from their management team to own the business, short-term and long-term. They work with them and align them on a clear picture of where the business model and the operating model need to be in 3-5 years. They share a “picture of the future,” if you will.

They establish a clear and broadly accepted mandate for corporate innovation of what it has to deliver – and which support it will receive.

Decide on a few big bets and their growth strategy

In many large companies, a new business’s initial impact is minimal compared to the balance sheet’s size. Leadership may be inclined to use Scaling-Up’s funding instead for initiatives that promise a multiple of the new businesses’ revenues with a lower risk.

The paradox is that there is no proof that the brilliant idea can be the foundation of a billion-dollar business before someone else has built it – but then it is probably too late.

The trick is to arrange a sequence of small bets that eventually build and prove the big ambition. If, for instance, the company assumes that customer expectations are shifting towards service-centered business models, the best route for the company might be to launch corporate startups where each builds “a piece of the puzzle.”

In Scaling-Up these corporate startups, a priority decision needs to be made: Is it more important to create a new business or support Core first? Leading companies do both: they scale up their corporate startups/ventures so that Core profits first but keep an eye on building an external business – while using the Scaling-Up journey inside the company to mature the products and sharpen the value proposition.

Create a supportive environment

There is an “Us and Them” between the Core and the innovation units in too many companies. The one side speaks of “innovation theater” while the other side complains that “they don’t get innovation.” It is not helpful to have these conflicts. And when a particular scaleup gets in-between a rock and a hard place, success is in danger.

Leading companies understand this. Their leaders establish an effective “ground control” – like in the classic movie “Apollo 13”. There are three men in a small capsule, exploring new territory, running into unforeseeable problems – and NASA on the ground with all its resources and constant communication helping these men solve their problems.

Leaders create mutual understanding between the two sides, Core and scaleup. They engage in a meaningful way. And they help to find the best solutions for the harsh prioritization reality. i.e., splitting precious resources between running today’s and building tomorrow’s business.

Manage a blend of cultures

Leading companies found that three Playing Fields need to be managed concurrently to win in innovation. First, the incremental innovation space; second, the space in which radical/disruptive innovation is created and accelerated; third, the middle ground, where radical/disruptive innovations are scaled up and Digital Transformation plays out.

These Playing Fields are not just “three horizons.” They have distinctive success factors, operating models, and cultures.

Leaders who understand innovation recognize this. They nourish a blend of cultures – especially at transitional interfaces – instead of taking sides. For instance, they encourage the interaction between staff from the various cultures, and they also encourage secondments from Core into scaleups.

Culture & Collaboration

Culture & Collaboration

Lean Scaleup Collaboration

Align Core and scaleup

The “corporate antibodies” that eat away innovation are deeply rooted in the KPIs which measure Middle Management and functional experts’ performance. These metrics govern Core’s day-to-day operations and plans – but they do not foster innovation.

Hence, to build a solid launchpad for Scaling-Up success, the scaleup needs to be integrated into Core’s planning systems and their associated KPIs. Middle Managers and functional experts need a tangible reason why they should support the scaleup.

Having this formal alignment in place is necessary but not sufficient.  Additionally, Middle Management and functional experts on the one side and the people from the corporate scaleup on the other side need to define the “partnership balance.” The resulting agreement should spell out each side’s benefits and the individual contributions and risks during the Scaling-up journey. It should also state how customers profit from the Scaling-Up partnership between Core and the scaleup.

Often, this discussion is a powerful tool to align both sides.

Create a productive culture and work style

When Middle Managers and functional experts meet the people from the corporate scaleup, two different cultures meet. On the one side, there is a process- and efficiency-driven culture with predictability and zero mistakes as top values. On the other side, there is an agile, entrepreneurial culture.

Accelerating the Scaling-up journey requires a psychologically safe space for mixed teams with people from both sides is needed. This is particularly relevant when the scaleup establishes a new business model – or even makes the existing one redundant – or when there are other potential conflicts, e.g., sales channel conflicts.

Additionally, a productive workstyle needs to be designed and agreed upon as well – it does not come by itself. Typically, at the beginning of Scaling-Up, this is a more Sprint-oriented style of work, whereas, in later stages, this is a more functionally-driven one with overarching OKRs.

Manage hypergrowth, create a growth culture

Managing a hypergrowth business with a CAGR of 80 percent or more is not an easy task. Only a few successful serial entrepreneurs know how to do this. So typically, the leaders of such rapidly scaling Emerging Business Opportunities need guidance to master the challenge.

Some fundamental pieces are: being clear on what the scaleup needs to achieve until the next milestone; having transparency on the critical (non-financial) KPIs they need to master and the decisive levers; running a hypergrowth business while at the same time invest in more scalability; lean and agile management to advance the whole scaleup at pace, with constant prioritization.

Leaders of scaleups also need to create a growth culture to support them in the race against time and stakeholders’ expectations. In a growth culture, people build their capacity to see through blind spots; they acknowledge insecurities and shortcomings rather than unconsciously act them out; they spend less energy defending their personal value to have more power available to create the company spirit and the external value. In scaleup organizations, how people feel — and make other people feel — becomes as important as how much they know.

Support cultural assimilation Core / Innovation

Every corporate scaleup has two functions.

The explicit one is to generate business impact. The other, a more subtle one, is to make support the transformation of the Core’s culture.

When this interface between the company’s “Run the business” and “Change the business” parts is functioning well, a virtuous can emerge: more openness and innovation capabilities generate more innovative ideas, and these create more openness towards innovation and innovation capabilities.

Heads of Organizational Developers, HR and Digital Transformation in leading companies are aware of this. They help organize support for the scaleup – but expect to return the scaleup to support them, as a case in point, in their corporate change agenda.

Align Core and scaleup

The “corporate antibodies” that eat away innovation are deeply rooted in the KPIs which measure Middle Management and functional experts’ performance. These metrics govern Core’s day-to-day operations and plans – but they do not foster innovation.

Hence, to build a solid launchpad for Scaling-Up success, the scaleup needs to be integrated into Core’s planning systems and their associated KPIs. Middle Managers and functional experts need a tangible reason why they should support the scaleup.

Having this formal alignment in place is necessary but not sufficient.  Additionally, Middle Management and functional experts on the one side and the people from the corporate scaleup on the other side need to define the “partnership balance.” The resulting agreement should spell out each side’s benefits and the individual contributions and risks during the Scaling-up journey. It should also state how customers profit from the Scaling-Up partnership between Core and the scaleup.

Often, this discussion is a powerful tool to align both sides.

 

Create a productive culture and workstyle

When Middle Managers and functional experts meet the people from the corporate scaleup, two different cultures meet. On the one side, there is a process- and efficiency-driven culture with predictability and zero mistakes as top values. On the other side, there is an agile, entrepreneurial culture.

To accelerate the Scaling-up journey, a psychologically safe space for mixed teams with people from both sides is needed. This is particularly relevant when the scaleup establishes a new business model or even replaces the existing one or when there are other potential conflicts, e.g. sales channel conflicts.

Additionally, a productive work style needs to be designed and agreed as well – it does not come by itself. Typically, at the beginning of Scaling-Up, this is a more Sprint-oriented style of work, whereas in later stages this is a more functionally-driven one with overarching OKRs (Objectives and Key Results).

Manage hypergrowth, create a growth culture

Managing a hypergrowth business with a CAGR of 80 percent or more is not an easy task. Only a few successful serial entrepreneurs know how to do this. So typically, the leaders of such rapidly scaling Emerging Business Opportunities need guidance to master the challenge.

Some fundamental pieces are: being clear on what the scaleup needs to achieve until the next milestone; having transparency on the critical (non-financial) KPIs they need to master and the decisive levers; running a hypergrowth business while at the same time invest in more scalability; lean and agile management to advance the whole scaleup at pace, with constant prioritization.

Leaders of scaleups also need to create a growth culture to support them in the race against time and stakeholders’ expectations. In a growth culture, people build their capacity to see through blind spots; they acknowledge insecurities and shortcomings rather than unconsciously act them out; they spend less energy defending their personal value to have more power available to create the company spirit and the external value. In scaleup organizations, how people feel — and make other people feel — becomes as important as how much they know.

 

Support cultural assimilation Core / Innovation

Every corporate scaleup has two functions.

The explicit one is to generate business impact. The other, a more subtle one, is to make support the transformation of the Core’s culture.

When this interface between the company’s “Run the business” and “Change the business” parts is functioning well, a virtuous can emerge: more openness and innovation capabilities generate more innovative ideas, and these create more openness towards innovation and innovation capabilities.

Heads of Organizational Developers, HR and Digital Transformation in leading companies are aware of this. They help organize support for the scaleup – but expect to return the scaleup to support them, as a case in point, in their corporate change agenda.

Lean Scaleup Collaboration

The References.

Companies that co-created / work with The Lean Scaleup™ framework.

Tell me more!

On a regular basis we share insights about the Lean Scaleup, how it is applied and the results being achieved.

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The References.

Companies that co-created / work with The Lean Scaleup™ framework.

Tell me more!

On a regular basis we share insights about the Lean Scaleup, how it is applied and the results being achieved.

Sign up to get these insights delivered straight to your inbox.

  • This field is for validation purposes and should be left unchanged.

The Time To Act Is Now.

The Time To Act Is Now.

Scaling-Up excellence is not an option – it’s a must.

Scaling-Up excellence is not an option – it’s a must.

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The Lean Scaleup™ Works.

The Lean Scaleup™ Works.

It addresses the pivotal points of the corporate Scaling-up problem.

It addresses the pivotal points of the corporate Scaling-up problem.

Toolbox

Before the Lean Scaleup, there was no solid methodology on how to validate “Worth to be scaled” and “Ready to be scaled” in a corporate context.

The Lean Scaleup is also the first framework that addresses Scaling-up planning, funding, governance for corporate startups.

Toolbox

Before the Lean Scaleup, there was no solid methodology on how to validate “Worth to be scaled” and “Ready to be scaled” in a corporate context.

The Lean Scaleup is also the first framework that addresses Scaling-up planning, funding, governance for corporate startups.

Focus

There are many other approaches that focus on the early stages of innovation, i.e. ideation and incubation.

Up so far there has not been a framework that focuses on Scaling-Up – The part which decides if your company’s innovation is a costly hobby or if it generates business impact.

Focus

There are many other approaches that focus on the early stages of innovation, i.e. ideation and incubation.

Up so far there has not been a framework that focuses on Scaling-Up – The part which decides if your company’s innovation is a costly hobby or if it generates business impact.

People

If a corporate startup wants to create business impact, it needs to establish an unfair advantage in the marketplace. To do so, an intelligent and effective collaboration between the Core and the scaleup needs to be established.

All frameworks that came before the Lean Scaleup™ missed this aspect.

People

If a corporate startup wants to create business impact, it needs to establish an unfair advantage in the marketplace. To do so, an intelligent and effective collaboration between the Core and the scaleup needs to be established.

All frameworks that came before the Lean Scaleup™ missed this aspect.

Let’s Talk.

Let’s Talk.

What is the biggest issue that you want to have solved?

What is the biggest issue that you want to have solved?

  • This field is for validation purposes and should be left unchanged.