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How Your Organisation Can Win at Open Innovation

By Frances Ly

It was Professor Harry Chesbrough who first coined ‘Open innovation’ (OI)

in his book of the same name. He says that OI

“assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as they look to advance their technology.”

Open Innovation is quite different to traditional internal corporate innovation such as crowdsourcing ideas or redirecting resources. OI is about creating inflows of knowledge from the external environment and outflows of knowledge to the ecosystem through collaboration. In its report about open R&D models, Deloitte found that organisations pursuing OI were three times more likely to achieve late-stage success. Here are three ways that your organisation can leverage OI to boost its innovation success rate.

#1 Seek Strategic Specialist Partnerships

Now more than ever, companies need to open their doors to alternate ways of thinking and testing new ideas. ‘Collaboration’ is the name of the game and large companies can benefit from inviting external experts to discuss and actively solve R&D challenges.

A great examples is Google; the company excels at corporate innovation through its partnership with the scientific community. Through funding over 250 academic research projects each year, Google can identify and access breakthrough opportunities. Their publications can be accessed via arXiv and its own research site.

Google also keeps places for 30 scholars to spend sabbaticals at Google each year.

This type of OI has led to projects such as Google Brain, Google’s deep learning artificial intelligence research project. Microsoft has also joined forces with IBM, Intel, the European commission and other major organisations to work on a new breed of “Cognitive Home.”

#2 Establish an Innovation Outpost

All the startup capitals have innovation outposts, which can be seen in areas such as Silicon Valley, Boston and Tel Aviv. These have increasingly become a popular way for large companies to tap into corporate innovation. A report by Capgemini and Altimeter found that

38% of the leading 200 companies have set up innovation centres in a global tech hub.

The purpose of innovation outpost is to monitor companies and competitors for new technologies, emerging threats and potential tools for disruption. Large companies able to detect these opportunities are quicker to adapt to new technology, create new products or invest in rising startups. Alessandro di Fiore, one of Europe’s leading thinkers and chairman of Harvard Business Review Italia, suggests

outposts should map out local relationships, propagate intelligence and insights and speed up the corporate deal making process.

This is to ensure innovation outposts succeed in the face of detachment from the mothership.

#3 Truly Open 'Hacks' Events

Hackathons, in their truest form, should provide an open forum for hundreds of experts, customers and companies to collaborate on a specific problem statement or R&D topic.

The sponsoring organisation benefits through receiving customer input, deep knowledge and synergies with third party providers. All ideas that can solve the problem are welcome. For example, GE’s Geniuslink coordinates its open innovation efforts for GE and non-GE organizations that choose to work with them. From this, GE developed FUSE which has sponsored over 500 challenges in the last five years and brought together a network of over 7 million experts. MIT Sloan’s report on using open innovation to identify the best ideas found that

with an abundance of ideas, quality of the average idea may fall but the best one is more likely to be spectacular.

What is your organisation doing to activate open innovation? Comment below or say 'hi' via We would love to hear from you!


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