Page 142 - Grow from Within Mastering Corporate Entrepreneurship and Innovation

Emerging Models of Corporate Entrepreneurship 129

Because Cisco is large, EMTG has to focus on large targets.
Wall Street’s expectations for growth presented top manage-
ment with a $6.5 billion gap to fill in the next few years. So
EMTG is looking for markets that can generate $1 billion annu-
ally within five to seven years. This has translated into launch-
ing 15 successful EMTG businesses, enough to spread risk and
allow for variation in time to market, but not so many as to get
dispersed. EMTG set itself a target of succeeding with three-
quarters of its efforts, so this meant starting 20 projects during
this period. EMTG believes that it can achieve this relatively
high success ratio on large-scale projects by avoiding the prob-
lems that generally plague start-ups, such as the founder prob-
lem (great idea people who can’t manage), running out of cash,
being killed by bigger competitors, or having poor integration
with products made by others.
Few initial ideas will make it through the various due dili-
gence and market sizing investigations that make up the stan-
dard front end of a corporate entrepreneurship project. Perhaps
no more than 1 in 50 ideas can be turned into large-scale concepts.
So this meant that EMTG must bring in 1000 ideas or more for
preliminary investigation. It started by canvassing its business
partners, customers, and employees. EMTG started a wiki called
iZone to gather these and developed a WebEx space for collabo-
ration. This generated many dozens of ideas, but it was not
enough. So EMTG created an incentive program called iPrize.
The winner of an iPrize is personally awarded $250,000, and
Cisco commits to invest at least $10 million in the concept. Two
months after iPrize was launched, Cisco received more than 1200
ideas! Many of these 1200 ideas were not very good or very sig-
nificant. But EMTG’s attitude is that sometimes poorly thought
out or small-scale ideas represent individual views of a big mar-
ket opportunity. It may take a dozen ideas to flesh out a concept
that represents an addressable and lucrative market opportunity.