Steve Blank, a lean start-up expert has elegantly described the differences between start-ups and traditional large organisations.
“the 21st century definition of a startup: A startup is a temporary organization designed to search for a repeatable and scalable business model…
The corollary for a large company is: A company is a permanent organization designed to execute a repeatable and scalable business model.”
These definitions are useful and highly accurate. Most large organisations have chosen to focus on efficiency in execution of a business model as the rationale behind their efforts.
However, it is important to note that a corollary may follow but does not always preclude other logical alternatives. Breaking apart Blank’s structure there are a number of different elements in play:
- the duration of the organisation: temporary vs permanent
- the process of the organisation: search vs execution of a repeatable and scalable business model
- an implicit difference between effectiveness of a search and efficiency of execution
Importantly there are other options that could be chosen for these spots in Blank’s definition:
- Rather than looking at duration we could look at the ability of the organisation to change – adaptability with a scale from the highly adaptable startup to the fixed processes and systems of efficiency oriented large scale organisations.
- Rather than focusing on process efficiency we could focus on effectiveness of process at achieving purpose – no scalable business models is permanently enduring; they must be subject to eternal change to be more effective and to better achieve the outcomes for which people came together.
From this we can see that there is at least one more logical model to chose. Let’s define a responsive organisation thus:
“a responsive organisation: is an adaptive organisation designed to search for more effective ways to execute a repeatable and scalable business model.”
Blank is right that you can’t behave like a start-up if you are trying to be efficient in execution and startups should not be judged by efficiency of execution. However there are more than two models for an organisation to choose. Large organisations can be responsive but they need to choose to adapt and be more effective.