What this eBook is about?
Open Innovation has become a mainstream reality for growth business seeking to boost innovation performance and in responding to disruption. Start to think about you innovation activities as a system of interrelated components and learn about the role Open Innovation plays in this Growth Engine. Create the right approach for your business and successfully make the shift.
The Reason for This eBook…
Several books have been written on the rise of Open Innovation. For those familiar with the popular and academic literature, you will read about familiar ideas, but we hope you may also see a new connection between ideas.
What is different about this book is the practical application of innovation ideas to a case study; a large and successful FTSE100 manufacturing company. But the really new idea comes from bringing together of the worlds of systems thinking with open innovation to understand how we can build a perpetual engine of growth.
This eBook is written for business and innovation leaders who may be looking for something more from their innovation efforts; renewal, greater returns, ability to be radical or respond to commercial pressures.
Leaders of businesses that are yet to make the shifty to Open Innovation could ask four managerially relevant questions – specifically,
- Why Open Innovation? What are the benefits and risks of Open Innovation and what must be present for success?
- How should you organize for Open Innovation in a way that makes sense for your business?
- How should you go about developing a successful implementation plan and prepare for change?
- What is the link between Open Innovation and the increased Innovation Performance you want?
About Open Innovation…
Open Innovation has become a mainstream reality for many industrial companies of all sizes, sectors and technologies. In the last 10 years it has become one of the biggest ideas in innovation management and business strategy.
It is still a fairly fresh idea – the implication of this idea is that through collaboration between organizations, better quality innovation is possible, faster and at lower cost and risk than doing it all yourself.
There have been several drivers in this rise of Open Innovation. Global changes to the workforce and society in general and the availability of information and expertise beyond the firm’s boundaries has driven the opening-up of innovation systems. Open Innovation works because it leverages the vast external-to-the-company mineral veins of ideas and knowledge and facilities and resources to shift and energize innovation portfolios.
But also, the boundaries of the firm have become increasingly porous; to information flows, ideas, people and capital. All flow both inwards and outwards between the firm and its external environment in fuelling a firm’s Growth Engine.
In the real world, innovation is unlikely to be completely closed or entirely open and a whole range of choices for organizing innovation are possible between these two poles. We’ll look at these and think about the choices we can make.
Benefits and Risks of Open Innovation…
Open Innovation can deliver many benefits. But, it’s not all a bed of roses: it comes with risks that need careful handling. Open Innovation should not be entered into ad hoc but be a strategic choice and we must lay foundations before proceeding with change or we will falter.
We believe that Open Innovation is now a necessary component of high innovation performance. However, other components are needed in order to become systemically strong: to build and refine your Growth Engine.
Firms benefit in a number of ways. Happily, for business leaders we can enjoy better financial performance and the ability to respond to disruptive competitors by becoming radical innovators ourselves.
This doesn’t come for free: we must also bring greater technological activism as business leaders and their direct teams to combat sluggish innovation performance.
The shift to Open Innovation is not a short term fix. Do you have the patience to for the positive effects to materialise? How about 2-3 years of diligent change management? And do you have the stamina for longer if your intention was to fully shift to becoming a high-performing Open Innovator?
The greatest rewards come to those choosing to do Open Innovation with determination across their innovation system.
Interestingly, while the firm grapples with the dilemma to Go Open, it is ultimately the customer who chooses whether a firm should do Open Innovation…
Organizing for Open Innovation…
A major philosophy in this book is that Open Innovation must be organized as if you mean it – the shift to Opening requires new and demanding ways of working. These methods have a major potential to complement your existing making-of-the-new activities but need to be sensitively accommodated in your existing culture and business.
As part of the shift to Open Innovation, why not use the opportunity to develop your own innovation management toolset? The wide and competent use of innovation management tools, techniques and work processes is a vital foundation stone to great innovation performance. Routines are essential – keep your people clear on what they need to do and how to do it to free them up for the really difficult thinking. Don’t let innovation be an “event” – make it business as usual.
We advocate, that to reap the rewards of Open Innovation you need to adopt in system wide to get that more-than-the-sum-of-the-parts performance: What we have called systemic Open Innovation.
Take a look at you existing innovation ecosystem and ask yourself how will you now nurture it to make it thrive?
It is useful to start thinking about your innovation activities and processes as a living system and nurture it as a farmer would. So, sensitively design or re-build your innovation system – we’re unlikely to get things perfect first time. Persevere can keep a learning and improvement mind-set.
Shifting to Open Innovation …
We have made the choice – Open Innovation will become a major part of how we deliver new products and services.
We need to do our homework, first.
We have developed an approach for leaders to plan for and implement their own Open Innovation change management programme.
By understanding and becoming clear on the total business environment we can plan our change to Go Open by placing our concerns for people central to the process – so the change will stick.
In support of our main thrust, we need to install a change management infrastructure with firm support from top management. The Open Innovation Champion is a key individual in driving change.
We have a choice from different strategies for initiating the change – choose the one that fits your business best. You can start small, gaining focus, building capability and finally, expand but always keeping the end in mind.
Finally, we remind ourselves that you must know where your innovation organizations is at – assess this and if needed, do some remedial work before Going Open.
The Link between Open Innovation and Financial Performance…
Collaboration and Open Innovation with partners is critical to how companies can make a step-change to their innovation and subsequent financial performance.
Open Innovation by itself is a component of innovation performance improvement- but while necessary, it is insufficient.
We advocate combining Open Innovation with other critical elements to build Growth Engines.
Components for a Growth Engine are…
- Innovation Strategy aligns business and corporate strategies, and…
- Leadership & Structures that creates a climate of performance, and…
- Applying innovation Tools & Techniques, and…
- Fruitful collaborative partnerships through Open Innovation, and…
- Supportive Innovation Culture exhibiting the right behaviour.
About The Growth Engine
I help organizations create an enduring capability to innovate and truly believe that by creating and continually refining a Growth Engine you will see the way to significant improvement.
Finally, I suggest that building a great innovation engine is not for everyone: it is a choice. If your business aspires to sector leadership I provide the means and ability to make that happen.