Cameron’s Silicon Roundabout will not be political “puff” that came to nothing. It will now become reality.
We can all see how technology is changing everything, disrupting the way we used to do things. In the past, big technology projects were often initiated by government who had the funding (those were the days!). These innovations would be picked up by large corporates who would commercialise them and, eventually, the benefits would flow down to SMEs and consumers in the form of new products and services.
Now, the process regularly starts with the SMEs and consumers who have access to the latest technology. The ideas and the process of innovation flows up to large corporates and eventually to government. New technology has turned the process of innovation on its head. We get headlines like “Ministry of Defence does not understand SMEs” – that’s because the SMEs are trailblazing and, more often than not, government and large corporates are lagging way behind.
The bigger an organisation becomes, the slower it usually gets. These corporate “tankers” are hampered by overly complex decision-making structures, making them inflexible and risk averse, despite their ability to invest. In contrast, SMEs (or the “tugs” as I call them) have the benefits of speed, entrepreneurial ambition and the manoeuvrability and willingness to take calculated risks without the “baggage” – but finance is often a major constraint.
In some sectors, specifically healthcare/biotech and technology, this is well recognised. The larger corporates harness the talents of their smaller rivals to accelerate innovation through joint ventures and partnerships. I’m a huge fan of corporate venturing and partnering and have had direct experience both in the healthcare and technology sectors, where it has worked really well.
So, to revitalise our economy and kick-start growth, we don’t just need the banks lending again. We need government and particularly large corporates to actively partner with innovative SMEs to inject the entrepreneurial dynamism of which they are short.
Successful corporate ventures:
- Attract talent and big ambitions
- Have the freedom to innovate and “think the impossible”
- Are not hampered by bureaucracy
- Have a P&L and funding structure to ensure performance is transparent
- Deliver in short “sprints” to accelerated timescales
Right now, we have a massive opportunity for big business and government “tankers” to let the “tugs” help pull the UK economy back into growth mode.