Look outside for ideas: Lanny Cohen, global CTO, Capgemini, in Sydney. Photo: Dominic Lorrimer/Getty Images
Established enterprises should look to the start-up community for ideas that can be applied to their businesses or face being left behind.
That's the view of Lanny Cohen, top advisor with global consulting and outsourcing company, Capgemini.
Lanny Cohen, on his first visit to Australia since being made global CTO of the company, told IT Pro 75 per cent of the world's technology innovation was coming out of start-up companies.
"It is not coming out of the powerhouse high-tech companies. It is not coming out of corporations. It is coming from start-up communities all over the place."
He suggested that most companies, even large ones, could not hope to compete with market leaders by innovating internally. They needed to become very efficient at applying innovation.
"In 2013 Amazon spent $6.7 billion in R&D. If you are a retailer, how do you compete against a giant spending that kind of money?"
Cohen acknowledged that, today, most large enterprises do not have close links with the high-tech start-up community and he suggested that CIOs were best placed to develop and foster such links. "The role of the CIO is going to become very important because he is going to become the gateway, the resource that knows how to link into the start-up ecosystem."
He urged CIOs to "untether themselves from their existing world," saying: "In many companies the CIO is a utility manager role: keeping the trains running keeping the lights on."
However he said that the idea of getting involved in the start-up community was alien to most CIOs. "When I bring up this idea with CIOs the first question I get is 'What are you talking about?' and the next question is 'Where to I find these start-ups, who are they and how do I get access to them?'"
To this end, he said that Capgemini had embarked on a strategy of leveraging its in-house research resources to forge relationships with start-up communities around the world and tap into these relationships as sources of innovation for its clients.
"Capgemini has about 30 or 40 innovation labs, basically where our local offices are," Cohen said. The activities of these will be better co-ordinated and they will then seek to establish relationships with start-ups in a number of cities that Capgemini has identified as having particularly vibrant start-up communities. Cohen listed these as Melbourne, Berlin, Tel Aviv, Shanghai, New York, and Stockholm.
He said the company's aim was to create a new value proposition for engaging with its customers. "We want to create an opportunity for clients where they don't just have to engage with the Sydney office as a way to access innovation. We want that office to be a gateway for them to access the global innovation of Capgemini."
Kim Heras, a partner in Sydney start-up studio 25Fifteen welcomed any initiative from the corporate sector to better engage with start-ups. However he said start-ups should regard advances from corporates with considerable caution.
"The challenge for start-ups is to make sure that they are not diverting attention from things that matter into hitting a home run, which is effectively what getting involved with a corporate entails.
"The things that large corporations are good at - allocation and management of lots of resources - are the exact opposite of what start-ups are good at, which is prototyping, validating growing with high levels of uncertainty and high levels of risk."
He concluded: "The speed at which a corporation moves would kill a start-up very quickly if the start-up isn't careful to not lose focus on what they are really trying to do."