Organizations today are in the midst of a massive cultural shift, but most of them don’t know it:
innovation is no longer a linear process. Instead, it is part of an interconnected ecosystem where people, organizations, and sectors can foster inspiration, idea-generation, co-creation, and validation of ongoing iterations simultaneously. I’m going to share my story of how I have seen this trend grow over the past 5 years.
Because they can’t see this shift, many modern companies still follow a linear track to manage innovation – even when involving their employees, partners, target clients, or future-oriented groups like university students. This process on average takes one-and-a-half years on average from idea selection, to implementation, and then to market introduction.
In the meanwhile, we can see that companies have started taking their innovation process to the next level, with quicker and shorter iterations, digital collaboration, and cycles of validation to create breakthroughs in traditional R&D areas, but also in business development or social initiatives.
According to PWC’s survey from 2017, with over 1200 executives in 44 countries, 61% of respondents said they are already embracing open innovation activities to generate new ideas, and this percentage is growing with time.
I’m going to highlight three areas where open innovation is heading — to give readers the opportunity to get in front of them. In the age of innovation, it’s time to pioneer the space.
What if you were to involve thousands of employees, partners, and target customers to find the best solution validated by customer insights? Utilizing digital technology is the answer. An online innovation challenge is a scalable solution where collaboration multiplies, idea validation strengthens and time-to-market reduces.
How can I make this claim? Because I witnessed companies achieve this, in fact, I’ve seen it over and over again. The VodafoneYou open innovation campaign engaged talented youths to create a new product. Another great example is Telenor’s open innovation challenge that involved employees and partners for a customer service development effort. They discovered a breakthrough concept, and when they went to find out whose idea it was, they found that it
came from a mobile store clerk. They went through project planning and implemented their new service within weeks, which resulted in a $100k/month revenue stream and 400,000 customers in just four months.
Here is something exciting: IoT seem to connect technology in a way that enables real-time customer engagement. For example, Cisco and Hyundairecently announced their partnership to create the next-generation connected car experience, and Renault-Nissan-Mitsubishi launched Alliance Ventures to invest up to $1 billion in autonomous systems, connectivity and artificial intelligence. Different industries will adopt connected technology where companies use large-scale customer data for more efficient and seamless prototype-validation.
To speed up time-to-market, open innovation initiatives will become dynamically more collaborative. The digital suggestion box doesn’t work for Millennials, Gen-Xers, Boomers or the Greatest Generation, and it won’t work for Gen Y and Z. The future will have no place for simple online forms to submit elaborate ideas. Participants will rather need interactive methods fused with scalable technologies that will allow them to rapidly build up solutions with the help of customer insights. Through tech-enabled design thinking and well-defined short sprints, time-to-market significantly shrinks.
Introducing developments faster to market also depends on being agile. As customer demands evolve quickly, there is an increasing need for shorter innovation cycles. The followers of stage-gate or waterfall styles of management are often outpaced by the smallest, yet fastest growing startups. Traditional project management for validating and implementing ideas falls short.
Open innovation involves projects with high risk, high impact, and uncertainty. Stage-gate type of innovation may work best for incremental product development where details of what to build are given and where risk is minimal. However, enterprises are beginning to experiment with more agile processes.
With an agile approach, a potential solution is not researched for months but broken down to an MVP with multiple sprints of ideation, prototyping and customer validation. In every one to two weeks, the team will plan, develop, and test just one part of the solution. This process allows for shorter iteration cycles and swift validation. After only 30 to 60 minutes of collaborative decision-making sessions, teams will know whether they should stop, save for later or continue with with their projects. Simply put, if you want to uncover disruptive solutions quickly, especially those that are poorly defined from the get-go, you need agile innovation.
One-time success is not enough. Identifying new problems and opportunities, providing methods for creative problem-solving, design thinking and guidelines on how to use these methods are the basis of every innovation culture a company needs for long-term success.
But how do you get participants on board? First, recognize that open innovation does not apply to just product development, but rather to any type of development where problem-solving is involved. That means basically everything. So that means, you need to involve people from all kinds of areas of the organization with all kinds of different skill sets. The best way to do that is to invite participants for short sessions of design thinking or ideation where they can experience higher productivity than in a traditional meeting.
And to actually engage them? Tap into their motivations and interests, then give them a full spectrum of the techniques, tools, and resources they need to succeed. Through technological developments in Artificial Intelligence and machine learning, people will soon be able to participate in open innovation challenges that resonate with their personal activities and skills.
The key is to design a process where a diverse, highly motivated group of employees, customers or partners collaborate together, using design thinking and agile infused methods to build on customer insights. With the project vision in mind, the team will surface disruptive solutions that creates positive impact. Innovation champions of the future will be those who can solve problems on a small scale and identify opportunities on a large spectrum.
Through the 2020s, innovation will stop being a department, and will start being as much a part of work as your daily coffee or commute. We will see organizations introducing open innovation as an everyday practice in all departments and fields, not only for breakthrough innovation, but to any kind of problems, empowering us to do more, learn more, and achieve more.
Design thinking is a buzz phrase that has been thrown around companies for many years now. It is not a new concept but there are still many large companies that are yet to embrace this modern-day mindset and methodology. This ebook focuses on how organisations can apply design thinking and start to move the needle.