Principles of venture design

- The nature of competition has changed dramatically as a result of the march of technology, accelerated globalization, and vanishing barriers to entry, moving us from a timeline sustained advantage was a realizable goal, to one where transient advantage has become our new reality. In this reality, innovation and playing to win move from being an aspiration or sideshow to being a critical activity for our future growth, equal in importance to the playing not to lose work that grows and optimizes our current business. We map both on an expanded Ansoff Matrix to identify strategies associated with each and to illustrate when to apply venture design. Now we'll introduce the principles that are the center of the venture design approach and the rest of this course will be dedicated to bringing them to life and to illustrating how and when to put them to use. We've seen common key factors of success across the many new ventures we've helped get off the ground, regardless of whether we're working with a Fortune 50 leader or seed stage startup that is yet to have its first anniversary. Successful teams have the independence and authority to act in the best interests of their venture. They tend toward deep collaboration and transparency typically aided by simple, flat organizational structures. They act with speed and a sense of urgency, their focus sharpened by immediate business imperatives. With these factors in mind, we have distilled four overarching principles to guide and optimize design and strategy work within the entrepreneurial context. The principles offer guidance for how we operate within our team, interoperate with others, and conscientiously accelerate and prioritize our efforts. They're intentionally suggestive, not prescriptive. Constant and rapid decision making requires a flexible framework rather than a rigid process. No fixed set of operating parameters would be adequate to anticipate and navigate the unknown unknowns of entrepreneurial innovation. Here's a brief introduction to the four principles. The first is grant and defend autonomy. New ventures thrive when provided the freedom and agency to continually shape their own best practices unencumbered by organizational history, politics, legacy systems, et cetera. The second is drive continuous engagement, emphasize deep collaboration, transparent workflows, and flat teams to gain efficiency, continuity, and capability across all contributors. Cumulatively, this enables the founder's mindset of co-ownership and emphasis on impact. The third is prioritize progress over process. Rather than adhering to a rigid process, seek and exploit opportunities to move further faster. New venture teams should jump ahead whenever possible. The fourth and final is design the impact, not the product. Define and work toward clear business objectives, focusing on what is necessary and sufficient for success. The required impact is the constant, and how you achieve it is the variable, not the other way around. The potential impacts of venture design are many and varied. It's worth pointing out one overarching objective of venture design to keep top of mind as you continue this course. In his book, The Founder's Mentality, Chris Zook calls out what he refers to as the paradox of growth. Simply put, "Growth creates complexity and yet complexity "is the number one killer of profitable growth." A key objective of venture design is to enable both young and mature companies to reduce complexity and increase the throughput of innovation activities. So let's get to it.