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Reducing Ambiguity in the Fuzzy Front End for Internal Corporate Ventures

Malmqvist, Emmy LU and Krokström, Hanna (2018) INTM01 20181
Innovation Engineering
Abstract
Innovation is a widely known concept which has received increased importance in today's organizations. Attention has especially been directed to the initial phases of the innovation process, commonly referred to as the Fuzzy Front End (FFE). Managing the FFE effectively, has become essential in the development of innovative products, since it can reduce cycle times and costs related to product development. However, due to the fuzzy and insecure nature of this phase, it is hard for companies to successful manage the FFE. Another emerging trend, is that of many companies seeking inspiration from external startups to find new ways to be innovative. For example, corporate venturing programs have been established to drive projects like... (More)
Innovation is a widely known concept which has received increased importance in today's organizations. Attention has especially been directed to the initial phases of the innovation process, commonly referred to as the Fuzzy Front End (FFE). Managing the FFE effectively, has become essential in the development of innovative products, since it can reduce cycle times and costs related to product development. However, due to the fuzzy and insecure nature of this phase, it is hard for companies to successful manage the FFE. Another emerging trend, is that of many companies seeking inspiration from external startups to find new ways to be innovative. For example, corporate venturing programs have been established to drive projects like startups, internal corporate ventures (ICVs). Nonetheless, the culture, climate and context of an external startup are different from the ones of an internal corporate venture, which has an impact on the possibility of an ICV to act like a startup.

The purpose of this study is to increase the understanding for how to decrease ambiguity in the FFE for ICV. As this research has been conducted as a case study, this master’s thesis furthermore aims to provide recommendations to the case organization - the Global High-Tech Company (GHTC). The theoretical background has been used to construct a conceptual framework, which constitutes the basis for the empirical data collection as well as the data analysis. The data collection consisted of a case study and a benchmarking study. The findings from these have been compared to contrast similarities and differences between the two startup-like companies, when it comes to enablers and challenges in the FFE.

From the analysis, eight key enablers have been identified, which could reduce the fuzziness for ICVs in the FFE, namely:
Usage of partnership, Usage of networking, Usage of pivoting to develop and refine ideas, Engagement of customers in the product development, Validation with others than customers, Usage of a proof of concept, A team with all necessary competences, An appropriate degree of formalization and Clearly defined goals. (Less)
Abstract (Swedish)
Innovation är ett vidkänt koncept som har fått ökad betydelse i dagens organisationer. Uppmärksamhet har framförallt riktats till de initiala faserna av innovationsprocessen, kallade Fuzzy Front End (FFE). Att hantera FFE effektivt har blivit nödvändigt i utvecklingen av nya innovativa produkter, eftersom det kan minska cykeltider och kostnader relaterat till produktutvecklingen. Det är dock svårt för företag att hantera FFE på ett framgångsrikt sätt, på grund av dess osäkra och oklara natur. En annan framväxande trend är att många företag söker inspiration från externa startups för att hitta nya sätt att vara bedriva innovationsarbete. Så kallade corporate venturing program har bland annat etablerats inom större företag för att driva... (More)
Innovation är ett vidkänt koncept som har fått ökad betydelse i dagens organisationer. Uppmärksamhet har framförallt riktats till de initiala faserna av innovationsprocessen, kallade Fuzzy Front End (FFE). Att hantera FFE effektivt har blivit nödvändigt i utvecklingen av nya innovativa produkter, eftersom det kan minska cykeltider och kostnader relaterat till produktutvecklingen. Det är dock svårt för företag att hantera FFE på ett framgångsrikt sätt, på grund av dess osäkra och oklara natur. En annan framväxande trend är att många företag söker inspiration från externa startups för att hitta nya sätt att vara bedriva innovationsarbete. Så kallade corporate venturing program har bland annat etablerats inom större företag för att driva projekt likt startups (eng. internal corporate ventures, ICVs). Dock finns det stora skillnader vad gäller kulturen och klimatet hos samt kontexten för en extern startup och ICVs, vilket kan påverka möjligheten för en ICV att agera som en startup.

Syftet med denna studien är att öka förståelsen för hur otydlighet kan minskas för ICVs i FEE. Studien har utförts som en fallstudie, varpå studien ämnar ge rekommendationer till fallföretaget benämnt Global High-Tech Company (GHTC). Den teoretiska bakgrunden har använts för att ta fram ett konceptuellt ramverk, vilket utgör utgångspunkten för den empiriska datainsamlingen och följande dataanalys. Datainsamlingen består av en fallstudie och en benchmarkingstudie. Dataunderlaget har jämförts för att illustrera likheter och skillnader mellan de två startup-liknande företagen, när det kommer till möjliggörare och utmaningar i FFE.

Från analysen har åtta stycken huvudsakliga möjliggörare identifierats som sätt att minska osäkerheten och oklarheten i FFE för ICVs, nämligen: Användande av partnerskap, Användande av nätverkande, Användande av pivotering för att utveckla och förfina idéer, Involvering av kunder i produktutvecklingen, Validering med andra än kunder, Användande av en prototyp, En lämplig formaliseringsgrad
samt Tydligt definierade mål. (Less)
Popular Abstract
Despite access to both resources and experts, large corporations in the high-tech industry lack pre-requisites making them less innovative. Inspiration is therefore sought from external startups- new flexible ventures considered to be a major source of innovation, which has led to the emergence of internal corporate ventures. Furthermore, innovation is a widely known concept which has received increased importance in today's organizations. Attention has especially been directed to the initial phases of the innovation process, namely the Fuzzy Front End (FFE), characterized by high uncertainty and ambiguity.
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author
Malmqvist, Emmy LU and Krokström, Hanna
supervisor
organization
course
INTM01 20181
year
type
H2 - Master's Degree (Two Years)
subject
keywords
Innovation process, Fuzzy Front End, Internal Corporate Ventures, Startups
language
English
id
8945292
date added to LUP
2018-06-05 15:29:09
date last changed
2018-06-05 15:29:09
@misc{8945292,
  abstract     = {Innovation is a widely known concept which has received increased importance in today's organizations. Attention has especially been directed to the initial phases of the innovation process, commonly referred to as the Fuzzy Front End (FFE). Managing the FFE effectively, has become essential in the development of innovative products, since it can reduce cycle times and costs related to product development. However, due to the fuzzy and insecure nature of this phase, it is hard for companies to successful manage the FFE. Another emerging trend, is that of many companies seeking inspiration from external startups to find new ways to be innovative. For example, corporate venturing programs have been established to drive projects like startups, internal corporate ventures (ICVs). Nonetheless, the culture, climate and context of an external startup are different from the ones of an internal corporate venture, which has an impact on the possibility of an ICV to act like a startup.

The purpose of this study is to increase the understanding for how to decrease ambiguity in the FFE for ICV. As this research has been conducted as a case study, this master’s thesis furthermore aims to provide recommendations to the case organization - the Global High-Tech Company (GHTC). The theoretical background has been used to construct a conceptual framework, which constitutes the basis for the empirical data collection as well as the data analysis. The data collection consisted of a case study and a benchmarking study. The findings from these have been compared to contrast similarities and differences between the two startup-like companies, when it comes to enablers and challenges in the FFE.

From the analysis, eight key enablers have been identified, which could reduce the fuzziness for ICVs in the FFE, namely: 
Usage of partnership, Usage of networking, Usage of pivoting to develop and refine ideas, Engagement of customers in the product development, Validation with others than customers, Usage of a proof of concept, A team with all necessary competences, An appropriate degree of formalization and Clearly defined goals.},
  author       = {Malmqvist, Emmy and Krokström, Hanna},
  keyword      = {Innovation process,Fuzzy Front End,Internal Corporate Ventures,Startups},
  language     = {eng},
  note         = {Student Paper},
  title        = {Reducing Ambiguity in the Fuzzy Front End for Internal Corporate Ventures},
  year         = {2018},
}