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Business execs need to become venture capitalists and angel investors: Ed Lenta, Amazon Web Services

Divina Paredes | May 12, 2014
Innovate and iterate like ‘startups' to compete with organisations using technologies to disrupt mature industries, says Lenta

CEOs and other business executives need to become venture capitalists and angel investors, building "factories of innovation" inside their organisations that invent and innovate like startups.

Ed Lenta, ANZ managing director, Amazon Web Services, posited this advice to businesses grappling with disruptions from organisations such as startups that are "thinking about production and consumption of technology" in whole new ways.

Mature and very profitable industries have been disrupted by these organisations, says Lenta in his keynote at the AWS Summit 2014 in Auckland.

He cites some examples: Air BNB for hotels, Spotify for music, Dropbox for Storage, Instagram for photos and Flipboard for magazines.

Enormous disruption by the production and consumption of service over digital means businesses have to find ways to innovate and iterate for customers, he says.

To do this, he says, "We need to change the culture in organisations."

"You have to democratise access to innovation," he says, exemplified by creating an environment to "experiment often and fail without risk".

But it is not enough to say we want to remove the stigma around failure, he says.

What business leaders need to do is create a culture in their organisations where the senior executives don't see themselves as the people "who need to have the big ideas".

They will see themselves as venture capitalist, as angel investors, facilitating groups inside the business that "invent and innovate" just like startups, says Lenta.

They should be able to provide resources for people with these ideas to enable them to iterate "really quickly".

If they fail, that is not a problem, he says. "Have you learned something? Is there some kind of information that we can now pass on to those around you?" These are the more important questions business leaders need to ask their teams.

To the successful ones, he says, "Let us iterate and grow and continue to expose them to customers and make sure we are coming out with great new products.

"That is the culture we all need to build inside our companies to make sure that we innovate with the best."

The speed of migration to cloud

"Around the world, some of the world's largest brands are looking to AWS as a strategic partner for innovation," says Lenta.

These include Qantas and Commonwealth Bank of Australia which are looking to build new apps and migrating existing workloads into AWS. He says AWS is also working with public sector organisations and government agencies, as well as academic institutions.

He says one of the major transformations in the market is the way software vendors develop and deliver their apps as a service. Leading ISVs (independent software vendors) around the world are choosing AWS to deliver those apps.

 

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