Open Innovation

So what we have seen so far is how innovation happens within the closed four walls of an organisation. This is known as “closed” innovation. This has how traditionally innovation has happened in most organisations in the 1990s and has been fairly successful so far.

But the topic of today’s post is a slightly different and definitely more radical way of doing innovation called “open innovation”. In an open innovation model, innovation is done by involving talent without any boundaries. So this means both talent inside and also outside the organisation. Now before you jump to any conclusions, let me clarify that I am not talking about outsourcing the R&D department. Far from it. I really believe that innovations and R&D are the main pillars of any organisation. But having said that, we also need the pillars to be as strong as possible.

Still not sure? OK. Let us go back to our previous case study example; typically any R&D or innovation project will have the following three categories:

1. Areas that you have worked on
2. Areas that you have not worked on and so are new
3. Areas that somebody in the organisation have worked on but needs digging to get to the right person.

Now the first category is the simplest of your worries and so let us not go into that. However categories 2 and 3 need your attention. Let us consider Category 2 in greater detail. In our previous example, you attacked this problem by getting your team to research and “google” around so as to get knowledgeable in this area. But is this the best way to approach this? A more intuitive method is to get the experts in this area to give you solutions in this area leaving you to focus on the other areas. I am sure you are wondering “What about Intellectual Property and how do I ensure that any patents are not being infringed upon etc”? Agreed there are some challenges around this but I am sure it is not so complex that your legal team cannot sort it out. All it needs is a firm understanding on how these issues are going to be handled and these needs to be agreed with the solver community upfront.

From your perspective, this solution ensures that your innovation project gets the best possible boost by involving experts in their domain on a need basis.

Of course, there is one other huge factor which needs to be worked out which is the reward mechanism to entice the experts to work on this. There are no rules around this but you will be able to find the “sweet spot” with some experience along with some googling around as well.

OK. Assuming you have reached so far, you must be wondering what next? Well couple of important steps which you need to be doing:

1. Ensure that you have the necessary buy in and sponsorship from the top management for your initiative.
2. Ensure that your team is geared up and receptive to new ideas which will come from the outside world.

So why are these two important?

Well, the first point is very important since you may well receive some disruptive ideas/solutions on the way forward. Unless you have the top management buy-in and support, you will find that you are not able to implement the ideas or solutions.

The second is equally important since the team which are evaluating these ideas/solutions from outside need to have an “open” mind. Otherwise they will be quick to find holes and throw all the ideas/solutions out of the window. Now, I am not saying that we should not view any idea/solution from outside critically. In fact, I would say, it is quite the opposite. We should review it multiple times. But what is important is that they should be viewed with an approach of “making it work” or a “can do” attitude. Of course many of these solutions may need to be tweaked to suit the organisational needs. However it is far easier to reject it upfront without even thinking through. Hence we should avoid this mindset and embrace the “open innovation” mindset instead.

So in summary, we briefly looked at how “open innovation” could happen in innovation projects and some of the important factors required for these projects to succeed.

Please feel free to write in with your thoughts and experiences. I would love to hear your thoughts on the same topic.