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Key Takeaways:
✔ Map your initiatives using the Ecosystem Matrix to reveal strategic gaps and redundancies.
✔ Balance exploitation and exploration across internal and external sources.
✔ Strengthen interactions between teams by encouraging knowledge sharing.
✔ Align every innovation effort with clear business objectives to maximise impact and drive growth.
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Many corporations claim to have an “innovation ecosystem,” but most setups are limited to a single Corporate Venture Capital (CVC) fund or a standalone lab. They operate in isolation, with minimal business impact and little to no revenue generation.
Healthy corporate innovation ecosystems are built with strategic intent, bringing together programs, initiatives, and partnerships that drive revenue, strengthen the core business, and unlock new growth areas that align with your strategy. So, why do so many ecosystems fail?
- Too narrowly focused: Relying on just one vehicle, like a CVC fund
- Too siloed: Little to no collaboration or knowledge sharing
- Too little strategic intent: Initiatives don’t align with business strategy
Without the right structure, these efforts run the risk of becoming “innovation theatre”—great in theory, but lacking real impact. Get it right, though, and you’ll have a powerful engine that drives growth, builds resilience, and turns disruption into opportunity.
In this article—Part 1 of our Corporate Innovation Ecosystem Series—we’ll show you how to audit your current setup, identify critical gaps, and rebuild it into a unified strategy that delivers measurable growth.
Let’s kick things off with some context.
Why are innovation ecosystems hard to evaluate?
Think of your corporate venturing ecosystem as a portfolio of innovation bets—a mix of units and programs that combine internal and external innovation to drive growth.
Internally, that might include labs, venture studios, or intrapreneurship programs. Externally, it could be CVCs, startup partnerships, accelerators, or academic collaborations. Together, they feed a pipeline of innovation projects that strengthen the core business (exploitation) and aim to discover new opportunities beyond them (exploration).
All these moving parts, each with different goals, timelines, and metrics, can make evaluating ecosystems tricky. That’s where the ecosystem matrix comes in.
What is a corporate ecosystem matrix, and how does it work?
Every initiative in your ecosystem can be mapped across two critical dimensions:
1. Innovation source
- Internal: R&D labs, intrapreneurship programs, venture studios
- External: startup partnerships, accelerators, university collaborations
2. Strategic intent
- Exploitation: Reinforcing the core business (e.g., optimising or expanding existing capabilities, often with the help of startup collaborations and partnerships).
- Exploration: Searching beyond the core (e.g. building or investing in new value propositions (VPs) and business models).
Plotting your initiatives on a 2x2 grid can help you more easily diagnose gaps and imbalances.
For example, if all your efforts cluster in External + Exploration (e.g. a CVC fund only investing in deep tech), you’re likely missing internal innovation pipelines and opportunities tied to your existing business. On the other hand, if you’re heavy on Internal + Exploitation (e.g. investing in new technologies to improve core products), you risk stagnation by ignoring external partnerships or future-focused bets.
Take the iPhone, for instance—Apple has long balanced core product improvements with disruptive innovation. However, in recent years, critics have noted a tilt toward incremental updates, raising concerns about innovation fatigue in what was once a category-defining product.
How to audit and fix your corporate innovation ecosystem
Using the Ecosystem Matrix as a foundation, here are four key criteria you can use to determine whether an ecosystem is “vibrant” or “static”:
1. Strategic balance
- Vibrant: Resources are distributed across both exploitation (e.g., optimising current products) and exploration (e.g., testing disruptive technologies).
- Static: The majority of funding (e.g., 80%) is allocated to chasing trendy startups which provide no strategic impact to the corporate.
2. Network diversity
- Vibrant: Draws innovation from a diverse mix of sources—new offerings through intrapreneurship programs, startup investments, research with academic partners, and partnerships with scale-ups.
- Static: Relies heavily on a single source, such as finding new ideas through an intrapreneurship program.
3. Strength of interactions
Vibrant: Innovation teams operate as knowledge platforms, sharing insights, knowledge and expertise while offering support when needed.
Static: Units operate in isolation with different departments, budgets, and goals, sometimes even competing directly with each other rather than building on shared progress.
💡Pro tip: Ventures don’t usually move between innovation units due to their distinct scopes. Sometimes, there can be a handoff between a program and a venture unit, or between a venture unit and a business unit. CVCs are a notable exception because they often sit in finance, strategy or corporate development and tend to take any good deal.
4. Strategic alignment
- Vibrant: Projects launched across venture units clearly support the company’s long-term strategic direction (e.g., redefining the category), while also contributing to nearer-term objectives (e.g., building new revenue streams or capabilities).
- Stagnant: Projects chase trends without considering how they serve the broader corporate strategy, leading to fragmented efforts and limited business impact.
The Bottom Line: A strong ecosystem isn’t a random assortment of projects—it’s a strategically balanced, diverse, and intentional machine designed to deliver measurable business outcomes. Use the four criteria above to stress-test yours.
Real-world ecosystem examples
Let’s bring the ecosystem matrix to life with some real-world examples. First, we’ll look at two examples of strong ecosystems, then we’ll break down two examples with room for improvement.
Strong corporate ecosystem examples
Corporates like Volvo and Siemens demonstrate how a strategic balance between exploration and exploitation can unlock long-term value. But how exactly do they build these thriving ecosystems?
Let’s break down their key components and uncover what makes them work.
Example 1. Volvo
External + Exploitation: Volvo’s Innovation Lab
Volvo’s Innovation Lab focuses on enhancing core automotive functions like manufacturing, safety, and connectivity. Driving continuous improvement in these areas helps reinforce Volvo’s brand promise while supporting Volvo’s core business.
Internal + Exploration: Camp X
Camp X houses three units, one of which is Volvo’s Venture Builder. It focuses on scaling solutions that reinforce Volvo’s existing business, accelerating development in areas like electric, autonomous, and connected vehicle technologies that align closely with core capabilities.
External + Exploitation: CampX Venture Client and Incubator
These two units scout external startups and scale-ups that can strengthen Volvo’s core operations, offering partnerships, proofs of concept, and implementation pathways that drive growth from the outside.
External + Exploration: Volvo Group Venture Capital
Volvo Group Venture Capital backs startups in mobility, logistics, and sustainability, extending Volvo’s reach into next-gen transport.
External + Exploration: Volvo Tech Fund
Volvo Tech Fund backs early-stage startups developing breakthrough technologies, aiming to explore new markets, business models, and mobility solutions beyond the company’s core.
Example 2. Siemens
Internal + Exploitation: Siemens Technology Accelerator
Siemens Technology Accelerator focuses on collaborating with business leaders, innovators and R&D specialists to identify promising ideas that might otherwise remain undeveloped.
Internal + Exploration: Siemens Energy Ventures Builder
Like CampX, Siemens Energy Ventures houses three distinct units. Its internal venture builder creates new ventures from scratch, exploring untapped markets and assembling dedicated teams to drive their growth.
External + Exploitation: Siemens Xcelerator
Siemens Xcelerator helps qualified startups scale by providing the software tools and resources they need to move from digitalisation to real-world implementation.
External + Exploration: Siemens Energy Ventures Capital
Siemens Energy Ventures Capital partners with energy and climate startups, helping them disrupt new markets and scale as a strategic growth ally.
Weak corporate ecosystem examples
Now that we’ve looked at two examples of successful ecosystems, let’s take a look at some on the other end of the spectrum, fragmented, siloed, or too narrowly focused.
Example 3. Allianz
Allianz’s weak spots:
- Fragmented focus: Allianz X invests in external startups primarily from a financial perspective, with little evidence of a broader strategic or innovation-driven intent.
- Lack of internal leverage: Limited intrapreneurship or in-house labs to harness the collective knowledge of their workforce.
- Minimal cross-pollination: Even when Allianz X invests, synergy with underwriting, risk management, or corporate strategy isn’t always clear, diluting overall ecosystem impact.
Example 4. Walmart
Walmart’s weak spots:
- Failure to feed back to the core: Walmart Labs (now part of Walmart Global Tech) focused on incremental e-commerce improvements but lacked distinct strategic value. Efforts often failed to deliver learnings, insights, and partnerships back to the parent. Eventually, ownership was shifted to internal business units, phasing out the need for a separate innovation team.
- Lack of strategic impact: Many initiatives struggled to create outcomes that were valuable or aligned with Walmart’s broader business strategy.
- Limited exploration: Most efforts stayed close to the core business, with little push into disruptive areas beyond the current market. For example, Walmart tried to compete with Amazon in e-commerce but often moved too late and failed to assess whether these moves truly supported the parent company’s growth.
The difference between “strong” and “weak” ecosystems often boils down to balance and strategic alignment. Strong ecosystems are able to both strengthen and protect the core organisation, while also expanding it and creating optionality for the future.
FAQ about innovation ecosystems
Q. What is a corporate innovation ecosystem?
It’s a strategic portfolio of internal and external innovation efforts designed to create both optionality (exploring future core opportunities) and strategic hedging (future-proofing the organisation against potential external disruptions).
Q. What’s the difference between optionality and strategic hedging in an innovation ecosystem?
Optionality and strategic hedging are two pillars of a strong corporate innovation strategy:
- Optionality fuels future growth by exploring new markets, technologies, or business models that could become core (e.g., launching a venture studio in emerging spaces). It’s offensive innovation: playing to win.
- Strategic hedging protects against disruption by engaging with competitive threats early (e.g., investing in capabilities, skills, startups or tech that could challenge your business). It’s defensive innovation: playing not to lose.
Together, they create a resilient, balanced ecosystem—one that discovers opportunity while mitigating risk.
Q. How do I know if my ecosystem is working?
Look for strategic balance, strong interactions, network diversity, and alignment with business goals.
Q. What is the ecosystem matrix?
A 2x2 grid that helps categorise innovation efforts by source (internal/external) and intent (exploitation/exploration).
Q. What should I do if my ecosystem is out of balance?
Start by mapping it, then reallocate resources or launch complementary initiatives in underrepresented areas.
Final thoughts
Innovation ecosystems aren’t defined by how many programs you have, but by how well those efforts work together to drive strategic outcomes. The strongest ecosystems strike a deliberate balance between exploitation and exploration, internal strengths and external opportunities.
If your current setup feels fragmented or stagnant, map it. Use the ecosystem matrix to uncover hidden gaps, realign your efforts, and turn innovation into a repeatable growth engine.
Check out Parts 2 and 3 of our Corporate Innovation Ecosystem Series to uncover common mistakes and learn the seven steps to building a successful strategy.
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Want to build your own venturing ecosystem? We can help you create a tailored partnership strategy that leverages your unique assets to fuel profitable growth, tap into new markets and build cutting-edge businesses at scale.
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