Page 35 - Grow from Within Mastering Corporate Entrepreneurship and Innovation

22 grow from within

and capabilities. Corporate entrepreneurship overlaps—and
should be coordinated with—traditional innovation and
growth investments, such as research and development labs,
technology incubators, corporate venture capital, mergers and
acquisitions, and spin-outs. The remainder of this section clar-
ifies what is meant by the terms new business and within an
established firm and provides examples of what corporate entre-
preneurship is and is not.
The “newness” of a business is a matter of degree, defined
by the level of differentiation from the company’s core busi-
nesses along several dimensions. It is not just about new
products. For example, suppose Dannon introduced a vitamin-
and-mineral-fortified yogurt. If no other company had ever
made such a yogurt, it could be construed as being “new to the
world.” But if Dannon simply threw vitamins and minerals
into the mixer and proceeded to market and distribute the
resulting yogurt in exactly the same manner as it did all of its
other products, leading it to end up on the grocery store shelf
next to its other yogurts, it would not constitute a new busi-
ness. On the other hand, what if making fortified yogurt
involved product formulation changes with which Dannon
had had no previous experience? What if the motivation to
develop this product was to begin selling it through individ-
ual vendors in Bangladesh, which represented a new market
for Dannon? What if Dannon partnered with a bank specializ-
ing in microfinance that would support the vendors in going
into the fortified yogurt business, as well as small manufac-
turers using local ingredients? In this latter case, Dannon is cre-
ating a new business.
You might recognize this story. In a 2008 article, Carol Mat-
lack of BusinessWeek described the novel partnership that Dan-
non (known as Groupe Danone in Europe) formed with
Grameen Group of Bangladesh, founded by Nobel Peace Prize