What is it about?

Open innovation -- when organizations formally collaborate with external partners to drive innovation -- is difficult, but scoped and managed strategically can produce superior results. These include overcoming internal barriers to innovation, delivering new toolkits, customer insights, speed, and efficiency. This article highlights obstacles and practical, strategic steps to structuring and optimizing Open innovation programs.

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Why is it important?

Innovation is an imperative for growth and competitive advantage, but most innovation programs fail. More organizations are turning to collaboration with external partners to spur innovation, but they stumble in terms of strategy, scope, communication, metrics, and internal coordination and governance. Better Open Innovation design and execution will enhance innovation outcomes and turn a one-off experimental expense into an platform of innovation assets and an infrastructure that can be leveraged to generate outsized returns on investment.

Perspectives

More than 95% of innovation programs fail to recuperate their cost of capital. Open innovation programs often sputter and fail, plagued by significant internal barriers and strategic drift. A strategic approach to structuring and managing successful open Innovation includes validating the need and fit, based on customer evidence; scoping the innovation assignment strategically; securing C-level sponsors; forging a nimble team; seeking leverageable synergies; framing the innovation program as a strategic portfolio; boosting alignment with innovation partners. This perspective has been gleaned as a strategic practitioner, across industry sectors.

Mr Michael K. Allio
Allio Associates LLC

Read the Original

This page is a summary of: Guidelines for open innovation success with external product development firms, Strategy & Leadership, August 2020, Emerald, DOI: 10.1108/sl-07-2020-0092.
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