How can corporations best fight atrophy?

How can corporations best fight atrophy?

I was listening to a podcast a while back* by Ried Hoffman (who started LinkedIn and Paypal) and something he said got me thinking about corporate atrophy**.

Ried mentioned how easy it was for Paypal to out maneuver the larger banking bodies during the startup phase. They were busy testing the legal definition of a bank with their online offering and the banks were squirming and nearly powerless to respond. In fact some of the banks online counter offerings took in excess of 12 months to deliver... as Ried correctly points out, thats an eon in internet time!

Just how did the banks get to this lethargic state?

And how can they (or any large corporate body for that matter) hope to compete in this rapidly changing business environment.

More to the point, How can corporations best fight this atrophy?

*For Rieds Podcast: 
** Definition of atrophy:

I posted this question in LinkedIn and got quite a few interesting suggestions back:

Mergers & Acquisitions
>>Let others take the big risks and buy them up when they look promising.

Various forms of Internal Entrepreneurialism
>> Google have an interesting internal policy where they allow thier employees to use 20% of their worktime to work on anything they want. They have enjoyed an enormous amount of success from the projects resourced this way.


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