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Ben Wong from Eureka Nova, and Lukas Petrikas from HKEX share insights at the Lifestyle Tech Conference
If pre-Socratic Greek philosopher Heraclitus expounded on his popular philosophy of Panta Rhei today, the world of business would have found it to be a mere truism.
Panta Rhei was Heraclitus’ way of saying that change is the only thing that is constant. Entrepreneurs and corporate bigwigs alike know this to be true–the only route for businesses to stay relevant is by adapting to a fluid, and sometimes capricious, external climate.
One way to drive this, Ben Wong pointed out at the Lifestyle Tech Conference on July 9, is corporate innovation. Corporate innovation has emerged as a means for corporations to integrate with change amid their characteristic structural rigidity, by sourcing innovation from startups.
Wong is Assistant General Manager at Eureka Nova, and was a speaker on the Corporate Innovation panel at the conference alongside Lukas Petrikas, Head of Innovation Lab, Hong Kong Exchanges and Clearing (HKEX).
Bringing in the innovators
Eureka Nova, an open innovation platform by Hong Kong-based New World Development (NWD), matches the company’s business units with innovation through various startup-oriented initiatives. One of the longest-standing corporate innovation programs in Hong Kong, Eureka Nova does this through accelerators, open competitions, or sandboxes, depending on the desired outcomes of the business units.
For instance, it worked with a property tech (“proptech”) startup to address NWD’s resource-use metrics, under its Sustainable Development Goals-based program Impact Kommons. By leveraging the startup’s plug-and-play energy efficiency solution, NWD businesses saved 16% in air conditioning and 39% in lighting.
“[It] worked out really well because all parties benefited from that. We were able to open a channel for the startup to roll out their pilot,” Wong said, adding that NWD could even accelerate efforts to achieve its 2030 energy efficiency goals by rolling the solution out at multiple properties.
By custom-building innovation according to the conglomerate’s specific business challenges, Eureka Nova improves the likelihood of integrating these innovations into NWD’s operations. Eureka Nova frequently taps into a comprehensive network of partners to assist in solving internal business pain points, offering contracts and partnership opportunities to any startups associated with the company.
Wong added that NWD is soon to take this a step further with the launch of a new innovation lab in which internal business units and external entrepreneurs can co-create solutions – ultimately leading to more use cases for the technology, and more efficient business operations for the company.
Finding the right startup
Over the years, Eureka Nova has isolated a few of the criteria to consider when bringing a startup into the picture. Wong likened this process to “getting the perfect medium rare steak every single time.”
The innovation must be core to the business, for instance, and should provide measurable value to business units. Ensuring a cultural fit will also benefit intercompany relationships. Moreover, the selection process must be rooted in deep due diligence, the startup’s growth metrics and expansion plans, and the founders’ backgrounds, Wong noted.
“We’re learning over time that the more mature the startup, and the more mature the technology to actually integrate, the better the chances,” he said.
Startups that make the cut at Eureka Nova may land contracts with NWD for pilots or other projects, and gain access to a wide knowledge pool. Several startups that have participated in NWD’s programs in the past still retain ongoing commercial contracts with the company, and are able to use that experience to earn their way to subsequent contracts.
Given NWD’s extensive holdings in hospitality, retail, aviation and infrastructure, as well as its vast network of experts and other partners, opportunities are plentiful for startups for B2B-focused startups to benefit from lucrative corporate deals.
There are potential pitfalls in the corporate innovation process. One to watch out for is what Petrikas called the ‘Not-Invented-Here Syndrome’, where corporations get so accustomed to technological heft and established internal processes, that they find it hard to allow another company to facilitate innovation on its behalf. Mitigating this issue required a company-wide paradigm shift for HKEX.
“It’s okay to not have your name on the thing or to take full credit for it, and it can still achieve as much value as you building it yourself,” Petrikas said during the discussion. “For us, that, I think, was a breakthrough moment.”
Ultimately, corporate innovation acts as a two-way relationship. The established company can integrate with new technologies that recalibrate its pace of business, and in return, is also able to impart the know-how of building and growing a resilient business back to the startups.
“I think this type of insight is really, really valuable for startups to go back and rethink how they prioritize their development,” Wong noted.
It all boils down to approach. When approached correctly, as Wong said, corporate innovation can result in outcomes that work for both the corporates trying to innovate, and the startups doing the innovating.
The 2nd edition of Impact Kommons is open for applications at www.impactkommons.com.
This article was written in partnership with Eureka Nova.
Header image by Rodolfo Clix on Pexels.