Babson Case Number: BAB057 | Length: 17 Pages

Abstract

After three years managing the growth and development of the Business Ventures Group (BVG), Joanne Hyland, vice president for new venture development at Nortel Networks, was being increasingly challenged by Nortel Networks’ senior management to justify the BVG’s existence and show its impact on Nortel Networks’ bottom line.

From a strategic perspective, Nortel Networks was struggling to evolve from being a telecommunications company to a major player in the Internet Age. To achieve success, the top executives at Nortel Networks saw the need for capabilities that were often second nature to start-up businesses. Therefore, they looked at the BVG as a learning opportunity. By taking technical concepts from the idea stage to being a valued part of a business unit or perhaps a spinout, Nortel Networks hoped to learn and develop much needed skills—skills that might make a giant like Nortel Networks capable of moving at the speed necessary to be successful in the New Economy. Having a formal program for evaluating and cultivating venture opportunities allowed Nortel Networks to continually streamline its innovation management processes and potentially uncover efficiencies that could be applied to its numerous lines of business.

The case considers how Nortel Networks could manage spin out ventures and other unaligned business opportunities in the future.