Corporate Venturing Units: Vehicles for Strategic Success in the New Europe

The reality facing multinational corporations (MNCs) is that traditional models of innovation are fast becoming obsolete. Multinationals used to manage innovation either through their centrally located research and development (R&D) activities (on a ‘‘centerfor-global’’ basis) or through the development activities of their individual subsidiaries (on a ‘‘local-for-local’’ basis). Economic changes confronting MNCs, however, bring these approaches into question. Increasingly, these traditional approaches are too slow to provide the necessary rates of innovation. They also fail to adequately recognize the interconnectedness of the corporation’s multiple geographic entities. In Europe, in particular, the reality facing MNCs has been – and continues to be – subject to fundamental political and economic shifts, which mean that the localfor-local model is no longer feasible or appropriate, and the center-for-global model only works for a small subset of cases. New models of MNC innovation are emerging that recognize a new set of ‘‘rules.’’ Under these new rules ideas, skills and initiative can come from anywhere – anywhere inside the company, and outside it as well. While multinationals may still steer innovation from the center, it is increasingly recognized that individuals and units anywhere in the world may be involved, and that the