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Big corporations do work very hard on making new ideas come to life in the world of technology.

Global technology leaders like Samsung spends over $10 billion annually on research and development and employs 50,000 talented and driven individuals to accelerate the pace of innovation. But, one thing is becoming perfectly clear in all cases:  once a company gets to a certain size, it starts to lose it’s appetite for risk, across many facets of its business.  And, the bigger the company gets, the more risk averse it gets, regardless of whether or not the company had innovation wired into its original DNA as a high-flying startup from years before.That leads to the question –

 “Why Big Companies can’t Innovate?”

1. Employees fear of making mistakes

“All organizations create routines, and innovation requires new routines, so it’s difficult. Routines allow you to operate efficiently—keep doing the same things over and over again without thinking about it—but they get in the way of trying to do something new. Making mistakes equal punishment. And we don’t want to be punished.

Punishment in the corporate world means that you’re going to lose your job.You won’t be able to feed your family anymore. You won’t be able to pay that mortgage. So you’re going to play it safe. ALWAYS.

2. Alteration in leadership

Leaders are accountable to assemble teams and lead them to optimal performance outcomes.  An effective leader recognizes the importance of embracing differences in people and knows how to connect the dots amongst those differences to get the best outcomes from the team. This is what cultivates a workplace environment of continuous improvements, innovation and initiative. Instead of kicking out, founders should keep them get involved in management and get them trained.

3. Complex Ecosystems

Most companies are not vertically integrated and therefore have a complex supplier, distributor, and customer relationships. One big complex organization is difficult enough to navigate, but doing it across an entire value chain is even more difficult. Ecosystems have intense implications for how companies plan for the future, and they ignore those implications at their own risk. Learning about business ecosystems–and the tools and methodologies needed to succeed within these complex entities–can help organizations improve effectiveness, manage risk, and break through to new innovations.

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