Where Tradition Meets Innovation: Business Start-ups
Young start-ups are similar to the world of small businesses, the “Mittelstand”: Both are innovative, efficient, adaptive, and driven by strong personalities.
During last month’s Event Build 0.10 (organized by HackFwd), the CEO of the German telecommunications giant Telekom, René Obermann, argued that a big corporation like his own must remain close to the pulse of the time and get to know the start-up industry. Telekom also invests in young start-ups and pursues cooperative ventures. Big companies have money, start-ups have innovative ideas. Obermann acknowledged that Telekom’s success depends on the company’s ability to incorporate outside ideas.
The current edition of the weekly “Der Spiegel” also includes a report on the shopping giant Otto, which built its business and reputation on a mail order business. But now it must compete with Amazon and a growing number of online shops. The article concludes that Otto made many good decisions and pushed into the digital age but that the behemoth is still struggling to keep the pace of online innovations.
When a company grows, distances grow and decision-making processes become more complex. Obermann knows is as well as Otto’s assistant CEO Rainer Hillebrand. Obermann’s solution: “I try to bring back a small business mentality.” In many regards, start-ups are not too dissimilar from the traditional German small-business culture, the so-called Mittelstand. Both are innovative, efficient, adaptive and driven by strong entrepreneurial personalities.
A look at postwar history reveals how big of a mark individual entrepreneurs have left on their country. In the media industry, we usually look to Axel Cäsar Springer, who would have celebrated his 100th birthday this year, and who built a small publishing house into a global media empire. The celebrations were designed to resemble an old revue performance, akin to the shows that were popular in Berlin in the twenties.
But the lightness of the performance should not mask the fact that Springer faced many ups and downs.
In addition to a strong personality at the top, the success of start-ups and small businesses depends on the team that executes the ideas. Those budding entrepreneurs who hunt for seed capital (whether they approach Telekom or actors who grew out of the start-up scene themselves) are quickly asked about their team - “it’s the execution, stupid!” The managerial realization is what turns an idea into a successful business story. A good idea alone is insufficient. Every team member counts, everyone is part of decision-making and their own “little CEO” for a part of the company. Big companies will never be able to replicate that culture. But we can instead look at those who work for start-ups.