Big Idea: Consortiums Often Fail, But Joint Venture Startups Will Challenge Digital Giants
Learn From The Failures Of Consortiums
Consortiums of independent companies have a high failure rate, despite their potential power.
@Constellation Research studied the history of 100 consortiums, shared services models, trading networks, and open source communities. All attempted to bring together companies for their self-interest, yet 99% of these coalitions failed!
They suffered from underfunding, too much focus on cost-cutting, and governance by consensus, making it hard to take decisive action.
Our research suggests that joint venture startups from established organizations challenging new digital monopolies have a much better chance of focusing on growth instead of cost savings.
They also need a strong mission and purpose, such as dethroning a common enemy, building cross-industry value chain dominance, and innovating data-driven insights. And while independent firms are reluctant to give up power to a benevolent dictator governance model, my book, Everybody Wants to Rule the World, shows why they need to take a chance on putting the head of the joint venture startup in the driver’s seat.
What type of joint venture startup will you create? Will you organize a common enemy? Will you build a joint venture across value chains? What's your strategy?
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