The essential steps to effective governance

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The essential steps to effective governance

Building corporate ventures for long-term success hinges on effective governance, according to Jan Sedlacek. The co-founder and managing partner of consulting firm Stryber explains how to ensure an organisation is properly prepared for the future with its corporate structure and hierarchy.

Whether you’re building a new corporate venture from scratch, or acquiring a new business, the likelihood of either of these options failing is pretty much guaranteed – unless, of course, you have the right governance in place. Whether you’re a budding entrepreneur or a seasoned corporate investor, creating a robust governance framework will make the difference between a venture that merely survives (or worse) and one that thrives.

So, how do you ensure effective governance within your organisation?

Jan Sedlacek is co-founder and managing partner of Stryber

Jan Sedlacek is co-founder and managing partner of Stryber

First, don’t be fooled by an entire industry of innovation shenanigans claiming to “don’t think, just do it”. It’s crucial for success to establish the right governance structure from day one. Governance starts with clear, measurable targets, which don’t just direct your business efforts, but also communicate your vision to stakeholders in a language they understand. 

Choosing an appropriate governance model is critical in today’s competitive landscape, and different ventures require bespoke structures – with the right model depending on the size, complexity, and nature of the business. Leadership should therefore take an adaptive approach, which supports efficient decision-making and can adapt as the business grows. 

The next big thing to remember is that it’s important to work as a team, and to make sure roles are clearly aligned to define who is responsible for what within your business. The key here is hierarchy, not the lack of it! Because hierarchy defines how goals are made accountable. In a corporate venture structure, hierarchy is crucially important for that reason. Don’t misunderstand hierarchy for micromanagement: this is about accountability, so that every team member in the structure understands their duties and how they fit in the broader strategic vision of the company – and can be made accountable to deliver their part.

You also need to implement communication channels that underpin effective governance, so there is a natural flow of information across all levels. Lean into technology to speed up the process – such as Slack to create the virtual equivalent of a real office and is embedded with tools which provide notifications and reminders. Always keep “the door open” for your team to come to you with any questions, any time. Avoid the “only bring me solutions”-trap.

Furthermore, insights are invaluable when you’re looking to measure success – which is why it’s imperative you have a system in place to track and evaluate your growth and success as a business. Positive results drive you forward as a business, but failures show you the key insights to obtain consistent success. Track each objective’s progress, identify the risk and rewards, and adjust accordingly. Rome wasn’t built in a day, but the building of its streets and houses progressed every day!

Once you have an effective governance structure in place, you can truly begin to plan for the future. As a corporate venture grows, its governance and overall structure must be able to scale alongside it – which involves integrating evolving challenges into the governance model. This constant adaptation for evolving needs of a grown entity ensures that the venture can handle increased complexity while scaling, without losing effectiveness. 

In today’s dynamic business environment, effective governance is not just about maintaining order; it’s about creating a foundation that allows for innovation, agility, and sustained success over a long period of time.

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