Survival of the Fastest: A Blueprint for Corporate Innovation Success

Innovation presents a paradox for corporations. Balancing agility with structure, risk with control, and long-term vision with short-term execution. Many companies strive to embed innovation into their core strategy, yet only a few succeed in turning new ideas into scalable, sustainable business models.

This article was inspired by a closed-door, by-invite-only fireside chat with Alexander Lau, VP of ST Engineering Ventures, the Corporate Ventures arm of ST Engineering, where he shared insights into how ST Engineering has successfully navigated the complexities of corporate innovation. The session was held in association with EDB as part of CVL 3.0, a corporate venturing program by EDB New Ventures designed to empower companies to drive deeper innovation through venture creation and startup partnerships.

Some organizations, like ST Engineering, have made significant strides in integrating open innovation while building internal capabilities. Others stagnate due to cultural resistance, rigid bureaucratic processes, or a lack of strategic alignment. This paper examines how companies can overcome these hurdles and create an innovation ecosystem that delivers tangible business outcomes.

One of the most critical aspects of scaling innovation is fostering a culture that can bridge the divide between corporate structures and startup agility. Corporations often operate within rigid frameworks, emphasizing risk management and efficiency, while startups thrive in dynamic environments that prioritize speed and experimentation. To successfully navigate this contrast, companies must learn to “speak” the language of startups, fostering an environment where internal teams can collaborate effectively with external innovators.

ST Engineering Ventures has tackled this challenge by hiring individuals with startup experience and an entrepreneurial mindset, to coach internal engineering teams so that they can operate with agility. HR policies have also been enhanced to encourage individuals from BUs to be more willing to participate in innovation projects. For example, employees who successfully participate in an innovation project from inception to completion are guaranteed a specific performance grade in recognition of their achievement. This targeted approach not only incentivizes end-to-end project ownership but also reinforces a culture where innovation and individual contributions are actively acknowledged and rewarded.

ST Engineering Ventures also refined its approach to idea generation over time. In its early years, the company accepted all ideas without restriction. By the third year, it began prioritizing ideas that aligned with strategic focus areas. This shift followed a three-step approach:

1. A five-year plan to identify key strategic areas where innovation could drive the most impact.
2. Refinement within business units, ensuring alignment between innovation initiatives and BU priorities.
3. Open-ended idea generation to encourage bottom-up innovation while maintaining a strategic focus.

Securing Leadership Buy-In and Sustaining Innovation Initiatives

Leadership plays a critical role in fostering a culture of innovation. At ST Engineering, management supports risk-taking, emphasizing that failure is an essential step toward success. “It’s okay to fail and fail fast,” is a mindset encouraged across the company.

One of the key challenges in sustaining innovation is securing BU buy-in. At ST Engineering, this begins with setting clear expectations for early validation. Projects are encouraged to demonstrate “good traction” within the first six months, a critical window that serves as a litmus test for market demand and internal relevance. Traction is measured not only by traditional metrics such as customer interest, market demand, or pilot project uptake, but also by signals of strategic fit, such as alignment with BU priorities or the ability to solve a known operational pain point.

This early validation helps to justify continued investment and secure support from business leaders. A critical enabler of this process is allowing KPI offsets, allowing adjustments to the BU’s performance targets to account for their participation in innovation efforts. This helps BUs balance innovation initiatives with core business operations without negatively impacting performance metrics.

To ensure that innovation does not become a siloed function, the company also integrates innovation into existing business operations. Leadership buy-in is achieved by aligning innovation efforts with business strategy and demonstrating clear pathways to commercialization. The company recognized early on that innovation should not be pursued for its own sake, as this could lead to “innovation theatre”- high-visibility initiatives that generate excitement but lack tangible business outcomes.

Bridging Global Strategies with Local Execution

For multinational corporations, implementing corporate innovation is not just about finding the right ideas, it’s also about ensuring that execution aligns with both global strategy and local market realities. One of the biggest challenges companies face is balancing corporate innovation goals with the constraints of different regulatory environments, talent ecosystems, and operational structures.

Regional teams often find themselves needing to bridge gaps between top-down directives and the on-the-ground challenges of implementation. This disconnect can lead to friction, where global headquarters push for innovation initiatives that may not be feasible within certain markets. Companies that successfully navigate this challenge take a hybrid approach to set clear strategic objectives at the corporate level while giving regional teams the autonomy to adapt execution based on local conditions.

ST Engineering has successfully navigated this complexity by ensuring that its innovation programs remain structured yet flexible enough to adapt to specific business environments. By maintaining an agile approach, companies can mitigate the common pitfall of rigid global frameworks that fail to account for regional execution challenges.

Lessons from Successes and Setbacks

Like many organizations, ST Engineering’s innovation journey began with external consultants. Initially, the company relied on external expertise to guide its venture-building efforts. However, leadership recognized the need to develop internal capabilities, reallocating consultant budgets to build in-house teams.

This transition allowed ST Engineering Ventures to take greater ownership of its innovation process and tailor it to the company’s specific needs. However, not all organizations can replicate this model. Companies with a strong sales-driven culture may struggle to instill an innovation mindset, as sales teams typically focus on existing customer needs rather than identifying new problems to solve.

For such companies, embedding innovation requires a fundamental cultural shift, one that acknowledges the need for problem-solving and proactive market exploration. Unlike engineering-driven organizations like ST Engineering, companies with a dominant sales mindset may resist open innovation simply because sales professionals are less inclined to acknowledge the need for new solutions. Overcoming this challenge requires structured interventions, leadership advocacy, and a long-term commitment to cultural transformation.

The Blueprint for Open Innovation Success

A well-executed innovation strategy requires a balance between vision, execution, and adaptability. Organizations looking to scale innovation successfully should consider the following action points:

1. Bridge corporate and startup mindsets – Build agile teams with an entrepreneurial mindset to communicate and collaborate more effectively with startups, while maintaining corporates priorities.
2. Secure BU buy-in through KPI flexibility – Allow business units to offset performance metrics while participating in innovation projects.
3. Ensure leadership commitment – Align innovation initiatives with corporate strategy to avoid “innovation theatre” and ensure tangible business outcomes.
4. Develop internal capabilities over time – Consider starting with external expertise but transition to in-house innovation teams for long-term sustainability.
5. Alignment on expectations – Recognize that not all companies have a problem-solving mindset. Some may need extra effort to align expectations and balance sales performance with innovation goals.

ST Engineering’s journey provides a compelling case study, but success ultimately depends on an organization’s ability to tailor these insights to its unique structure and industry landscape. By taking a balanced approach to leverage both internal strengths and external partnerships, companies can move beyond innovation theatre and drive meaningful, long-term growth.

At Start2 Group, we specialize in helping organizations build internal capabilities for corporate innovation, whether through leadership alignment, structured innovation programs, or fostering an entrepreneurial mindset within teams. To better understand your organization’s innovation readiness, take our quick 5-minute assessment. Get in touch with us today to explore how we can support your corporate innovation journey.

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This article was developed as part of Corporate Launchpad 3.0, a corporate venturing program by EDB New Ventures designed to empower companies to drive deeper innovation through venture creation and startup partnerships.

Start2 Group is proud to be an appointed Partner of the program.