Unlocking Open Innovation
It wouldn’t have been a surprise that a large number of innovations are created outside of big enterprises. Startups, research centers, academic organizations are important players that make a major contribution to the realization of the innovative potential of humankind. All this creates a gap, on the one hand, lay the companies that want to be leaders in the innovation market, on the other hand, we have a source of these innovations. So how to build a bridge between them?
There are several concepts for solving this issue. One of the most promising approaches – Open Innovation. It is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology. Open Innovation gives businesses and organizations the ability to access ideas for new products and services, solving challenges quicker and broadening the outreach and allow participants of different backgrounds, expertise, and location to contribute. Technically, it is a more participatory, more decentralized approach to innovation, based on the observed fact that useful knowledge today is widely distributed.
For business, Open Innovation is a more profitable way to devise, because it can reduce costs, accelerate time to market, increase differentiation in the market, and create new revenue streams for the company. So there’s a lot of opportunities for businesses to profit from Open Innovation. Hundreds of companies around the world now have executives with the job title, Manager of Open Innovation. And there are now dozens of software companies, intermediaries, and consultants providing products and services in open innovation. If nothing else, the presence of these newly-founded open innovation providers suggests that the concept has met a market test.
A digital open innovation platform is essential to make the open innovation ecosystem work as it aligns various actors to achieve a mutually beneficial purpose. It has impressive for innovation process advantages:
• Decreasing innovation costs. New ideas tend to be expensive. With open innovation, companies can access new ideas without involving a totally different division of specialists and engineers on their payroll.
• Enter to market faster. Open Innovation can accelerate product development significantly. By involving a bigger group of experts to contribute their thoughts and knowledge, organizations can take care of issues much quicker and can refine their products.
• Boosting product visibility. When done well, open innovation can drive a lot of new interest in a product, service, or company. For example, by investing in the Lego Ideas platform, Lego was able to generate a huge amount of coverage for fan-developed sets, and also gained a lot of media coverage. However, Open Innovation isn’t all plain sailing – so, what is the biggest challenge?
Across organizations that are on their way to successful adoption of Open Innovation, there are some specific patterns to the barriers and challenges faced.
When engaging with powerful minds outside the organization powerful support roles within the firm are demanded. However, there is not one single Open Innovation champion. Innovation processes can be complex and involve different persons, departments, and disciplines. Because this approach is so new organizations face challenges to assess correctly open innovation activities due to the lack of proper expertise. Furthermore, companies that do measure innovation tend to use generic metrics based on R&D and product development which are of very limited value.
Not all organizations have these types of expertise to overcome the forces that can potentially hinder Open Innovation. But what if they have the solution to these issues?
From my perspective, the future lies in companies that have learned to solve the problem of evaluating external innovation. They can make good decisions on sourced ideas gaining competitive advantage to open up opportunities creating the most valuable and impactful innovative products.
So, in your opinion, the quality assessment of sourced innovation is an acute problem? If yes, can it be an obstacle for the Open Innovation introduction? Share your thoughts in comments on what other issues could be taken into account.