Volume 15 | Issue 3 | Year 2012

Innovation: the new buzzword. It translates into the 21st century’s “competitive.”
Who doesn’t want to be known as an innovator?

But an irony comes into play. Innovation for innovation’s sake is negative. If not systematically pursued, innovation hamstrings progress – and no one considers a hamstrung company “innovative.”

As such, understanding the fundamentals of an effective innovation strategy is the first step in successfully pursuing – and subsequently achieving – innovation goals. Specific approaches such as Open Innovation (OI) – which embraces knowledge inflow/outflow – represent a result-driven strategy. New approaches are embraced by manufacturers, both the small and the large (think Unilever, Sealed Air, Kraft Foods, Philips, and AkzoNobel).

OI is exactly what it implies: It opens up the innovation process to external innovation resources. Collaborative sharing of a technology need or challenge with a larger of group of entrepreneurs, researchers and inventors exponentially expands the potential solution set. For example, the enabling technology an automotive manufacturer needs to speed new product development may not exist in its own four walls, or even within the industry. But that technology already may be in development by someone in the agricultural industry.

OI provides the power to speed up the innovation cycle, fill product pipelines faster, and deliver significant competitive advantages. It also takes the guesswork out of key innovation decisions and minimizes the risk of missing product functionality targets and production deadlines.

A successful innovation strategy supports corporate goals. Without direction, you’re stuck with a strategy to nowhere. OI strategies provide direction. Competitive advantage, repeatedly producing breakthrough products, speeding up time to market, retooling the company culture – these are common OI themes. So are finding more sustainable ways of using natural resources, disposing of chemicals, or creating recyclable packaging. These socially responsible and environmentally conscious concerns are pervasive.

Once a company determines its goals, it can implement OI as a methodical solution for achieving these goals. To get more breakthrough products to market, for example, companies must assess their competencies and existing infrastructure, and understand where gaps exist and when it makes sense to look to the outside. Then, they’re ready to contact potential solution providers.

Companies sometimes find it helpful to work with an OI firm that knows exactly how to identify and describe a need to solicit workable solutions. Such firms have experience crafting RFPs that articulate needs without disclosing the industry or application. This enables a manufacturer to cast the widest net and uncover technologies from unexpected sources. It also brings together an established, worldwide network of solution providers and Web-enabled platforms to speed the innovation connection process.

By adopting OI as a core practice, company leadership refocuses culture around innovation. Sharing the call for technology – both internally and externally – automatically creates collaboration and eliminates traditional obstacles to innovation, such as silos and turf wars. Organizations that seem to innovate effortlessly do so because their culture revolves around OI and collaboration. Within these organizations, traditional silos that – by production line or business line – pit one team against another don’t exist. Also, those who don’t view themselves as responsible for innovation (such as people in the sales force, legal, or purchasing) are made just as accountable as engineers and technologists.

Tactically, OI is used as a “plug and play” solution to fill gaps within internal innovation development processes. A recent NineSigma survey of more than 360 professionals across multiple industries revealed that while 62 percent are highly effective in tapping into their colleagues’ creative brainpower, only 10 percent have the systems and processes in place to single out the most promising ideas and quickly bring them to market. OI is the proven system that delivers repeatable innovation success. Many organizations also widen the circle to include key customers, partners, and suppliers, inviting collaboration on development of new products and services.

To summarize, any manufacturing organization can change its culture as long as leadership is willing to champion OI and put in place repeatable innovation processes. It sounds complex, but it gets easier with each innovation cycle.

Kevin Stark, PhD, is vice president, technology solutions, at NineSigma, Inc., the leading innovation partner to organizations worldwide. Learn more at www.ninesigma.com or at www.ninesights.com, the world’s first Open Innovation social media destination.

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