Think Like A Startup Whilst Managing Risk

January 16, 2021

Once a Deputy Director General for several State and Federal government agencies, Elizabeth Zealand, our CEO, has reflected upon key observations from moving from government to start-up.

Here’s her list:

  1. Experiments can reduce – not increase risk
  2. Get out of the building
  3. Move faster
  4. Create Proof of Value opportunities
  5. Procure for outcome not process

Many Cities don’t realise the opportunities of partnering with a start-up or emerging technologies. Beyond the benefits of working in an agile and often breakthrough way, there are many private and government incentives to support cities and Universities partner with emerging tech, including grants, live labs and smart city alliance projects.

It is important also for large established companies providing transportation services to look at collaboration with startups to add value to their existing contracts. Procurement strategies that could drive this collaboration include:

  • Innovation KPI’s in existing contracts
  • Live Labs
  • Innovation proposals
  • Unsolicited proposals
  • Be the willing customer for tech vouchers, MVP, grants, test beds, pilots
  • Industry collaboration – can the "usual suspects” partner with new and different resources
  • Shared infrastructure – within and without cities and universities

Another barrier to effective engagement with startups is the decision-making time cycle and the lack of emerging industry consultation. Cities and universities that are most successful are proactive with tech communities / startups / incubators / Smart City communities. “Get out of the building.”

Often, procurement documents and specifications are written in isolation of emerging tech, and are out of date by the time the tender is written. While pilots are a great way to experiment, it’s important to consider: What happens if this goes really well? What is the future path forward that doesn’t stop momentum?

The philosophy of a startup is to test things BEFORE they are ready with customers, a view which often does not sit well with Government risk appetites, but can often be managed by targeted communication and test groups. The greatest value to a startup is having the product tested in a live environment and seeing if we are solving the problems we think we are.

A female leader thinking as a startup to take her company forward

In Summary

  • Address the “Plan versus Do ratio”
  • Give startups feedback and tell us ‘no’ faster
  • Get the governance and implementation strategy sorted out BEFORE you decide to engage
  • You won’t always find the best solution through traditional procurement
  • Encourage an innovation tranche in existing service contracts
  • You don’t know what you don’t know

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