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In this master’s thesis, I will explore the existing literature about the validation processes of new business ideas used by corporations. For this, I will conduct a thorough literature review that will allow me to know the state of the art on this topic and identify the main knowledge gaps that prevail in how these validation processes affect the initial results of the new business units. Edison et al (2017) investigated the use of validation processes such as Lean Startup in software production in large companies. However, in general, the literature on this topic is very scarce and very little is known about how the processes of validation of new ideas affect the results of the new business units created in corporate entrepreneurship initiatives. Kirsner (2016) points out that she found five benefits for large companies that use these validation practices through a survey of executives, but her empirical research does not show the effect of these practices on the results of the creation of new business units.

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Why is it important to do academic research on this topic? “Entrepreneurship has never been more important than it is today” (Volkmann, Wilson, Rabuzzi, Vyakarnam, & Sepulveda, 2009). Startups are changing traditional industries with their innovative products and services and in some cases, they have displaced large companies. Well-established actors such as corporations look for possibilities to innovate and compete in this context of major disruptions. However, their processes of innovation and generation of new business units require validation practices of new ideas that allow them to adjust to dynamic, inexpensive and flexible processes such as those used by startups (Rejeb et al., 2008). Different validation practices of ideas are used by startups, such as those known as Lean Startup. However, its use has been little studied in innovation processes and generation initiatives of new business units in corporations. The academic literature about the use of these practices of validation of new entrepreneurial ideas in corporate entrepreneurship and its effect on the initial results of the new business units is practically nil.

The decision of whether an idea is a feasible opportunity involves a series of judgments in conditions of uncertainty and complexity (Keh et al., 2017). In the past, some authors such as (Hills & LaForge, 1992) referred to the validation process of venture new ideas as a series of steps to evaluate the viability of the venture that typically includes customer analysis, competitor analysis, and sales forecasts, among others. Literature about Lean Startup, developed initially by Steve Bank (2005) and Eric Ries (2011), presents this methodology as a set of principles that, based on an imagined opportunity, are used to formulate venture hypotheses and test them quickly and efficiently, usually through close contact with clients and other stakeholders (Kordgaard et al 2015). Ries initially coined the Lean Startup concept in the software industry, although, currently, these practices have been widely accepted in different industries (Nambisan, 2016). Lean strategies are an option for entrepreneurs in organizations of all sizes to become agile, effective innovators (Collis, 2016). In this research, I will focus on entrepreneurship in existing organizations, a concept that is also known as intrapreneurship (Antoncic & Hisrich, 2001) or corporate entrepreneurship, in the case of corporations. At the corporate level, one of the possible options for developing new business ideas is through the creation of business units. These units are constituted by a group of individuals who are in charge of the development, introduction, and management of a new business in the general umbrella of the mother corporation (Hisrich & Peters, 1986; Roberts, 1980).

The objective of this study is to identify what processes do corporations use to validate new business ideas to create new business units? Furthermore, I will investigate what literature exists about how those validation processes of new business ideas affect the effectiveness of the creation process of new business units? From these research questions, I will carry out a systemic literature review in databases such as Scopus, Proquest, and Ebsco. My interest is that this work has theoretical and practical implications both in future research and in entrepreneurship practices in the corporate context.

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