What is open innovation?
By definition, one can term innovation as the result of using knowledge through activities to make for a benefit that will help the user. In order for an innovation to be successful and provide the desired result it has to combine the knowledge from all dimensions, in and out of the organization. Around the globe, more and more organizations are now paving way to this open innovation concept. While this is a definitive need for the smaller organizations, the bigger companies are also moving away from their conventional R&D methods and to adapt to open innovation.
The driving factors
There are two major driving factors:
- Need for customized solutions which involve participations from stakeholders, customers and the suppliers.
- Reduced life cycle of products with more competition leading to need for better cost efficient products.
You can see the result of these open innovations across different industries from potato chips to mobile phones.
Open innovation has also given rise to new models in business and fresh structures. There are firms offering these knowledge as a product, termed as the “knowledge brokers.” They offer you the links, sources and other information which can help the businesses to gain momentum.
Role of open innovation in core capabilities
In the words of Leonard (1995), there are four facets to the core capabilities namely the technical systems, norms and values, systems for management, knowledge and skills. Additionally he also stated, knowledge import, experimentation, solving problems and integration plus implementation are the most core functions of any innovative strategy.
As you can refer from this model, knowing your capabilities and developing your core competencies is the key to success. Innovation is only possible if you have the collaborative and competitive advantage and to have the external abilities instilled your organization should be flexible to evolve with the change. In order to improve this adaptability, you can take the assistance of the knowledge brokers who act as the change agents, creating the necessary momentum for the innovation to kick off. They also help with easy adaptation for the customers to the changing market environment.
Organizations in favor of open innovation business models
Procter & Gamble, Philips and Nokia are some of the leading industry players which have been using the open innovation business models in their organizations. In fact P&G was more active in forming companies that were designed to aid the main organization as knowledge banks. These companies have now become independent and continue to support the main organization with a sturdy knowledge network. Few of these companies are,
- NineSigma which connects clients with leading innovators.
- InnoCentive with the best network of solvers to get multiple solutions to the seeker’s question.
- YourEncore which helps with knowledge recovery and comprises of veteran retired scientists in the lead.
Sociedade Portuguesa de Inovacao (SPI)
Founded in 1997, the company has been instrumental in connecting multiple businesses with different institutions and vice versa. In addition to the competencies in sector studies, evaluation of projects, establishing partnerships and alliances, etc the SPI also works towards development of networks and partnerships across the borders.
As a knowledge broker, SPI displays the ability to
- Create a structured project out of innovation related problems by understanding them.
- Understand the required knowledge, skill and the competencies required for problem solving.
- Knowing the best resources to provide the knowledge and the capability
- Working towards establishing a collaborative venture to solve the problem.
And these points clearly relate to the core capabilities and its different perspectives.
Advantage of Diversity for SPI
It is important here to note that SPI has a diverse team with people from 9 different countries, familiar with 11 different languages. Even the professional background of the 50 member team of full time consultants in SPI is vast, which enables them to bring in the expertise from different industrial sectors and also from different economical backgrounds. It has also resulted in them forming a vast network of relations and partnerships which has enabled them to meet the innovative needs of their different clients.
A case study with the SPI, knowledge broker
To know more on the working abilities of the SPI, let us take the case of the dairy products company from Portugal which approached them for establishment of an R&D center. R&D is one of the key requirements in today’s business scenario and SPI was well aware on the importance. It provided a strategy which resulted in the successful establishment of the R&D center. The strategy covered all the different aspects including research partner identification and relationship on research and more.
To start with the priorities of the company were identified and the research partners were chosen based on the same. There was an interview conducted to sort out the list of interested research partners to choose the best for the center. Once the partners were chosen, 6 in total, SPI then focused on the collaboration, monitoring and evaluation related activities. As a knowledge broker, SPI had acted as a change agent along with being a problem solver
As we can see from the above example of SPI, knowledge brokers have a key role in being a catalyst for seeking and improving knowledge within an organization. Every innovation has to be sustainable for which knowledge is imminent and without innovation there is no continuous success. We can therefore say with conviction that role of knowledge brokers in encouraging and guiding innovation is mandatory.