Think about the 50 smartest people in the world. Do all of them work for your company? How about the 50 most creative people? The 50 most innovative people? I’m guessing your answer is no. That’s why open innovation is gaining traction as a movement that allows companies to draw on external collaborators to find solutions and winning ideas.
Open innovation is constantly changing and evolving as more and more businesses jump on board. Companies with traditional internal R&D programs are beginning to realize the limitations of not being open to ideas from the outside. Even opening the curtains just a little bit will let some light in.
If you’re interested in adopting an open innovation approach in your company, it’s important to strategize so that you can get the most out of it. Some companies have learned the hard way that careful planning is necessary when it comes to open innovation.
In 2012, Mountain Dew launched a naming campaign for their new green-apple flavor. Unfortunately, the majority of the submissions were at best practical jokes and at worst profanities. Inviting customers to name products is a common open innovation pitfall that often results in failure.
German consumer goods company Henkel also suffered from open innovation gone bad. They kicked off a challenge in 2011 to find a new scent for their Pril dish soap. The winner was a chicken-scented soap that never made it onto the shelves. The main problem was that Henkel had specified that the entry with the most votes would automatically win. Because they assumed voters would align with their vision, they lost a significant amount of money in the challenge and had nothing to show for it.
What can you learn from these failures? Open innovation isn’t as simple as posting a question on your company’s Facebook page and hoping for the best. Instead, it takes careful consideration to devise an open innovation approach that works for your company. This open innovation guide will help you strategize so you can get the results you’re looking for.
What is open innovation?
Open innovation is based on the notion that ideas can come from anywhere. It relies on knowledge that comes from both inside and outside an organization to generate solutions that could not be reached without collaboration. One example of a company that exemplifies open innovation is GE, which offers scholarships, paid internships, and other prizes to the winners who solve the innovative challenges posted on their website.
The advantages of open innovation are numerous, including cost-effectiveness, convenience, brand promotion, and the opportunity to find creative employees. Businesses who choose to use the open innovation method appreciate that they can get a fresh perspective without having to permanently hire a team for any given project.
While the history of open innovation goes back centuries, there are several new paradigms that are shifting the landscape in meaningful ways. Companies are taking advantage of modern technology to create exciting open innovation contests that can be entered by people all over the world. With the onset of the pandemic, more people are working remotely than ever before, which gives them space to work on other projects of interest. A large segment of the younger workforce is part of the gig economy, which allows workers to pick and choose what they want to work on.
We believe that open innovation will continue to grow as more and more companies realize its value. The innovation trends of 2021 clearly point to the expansion of this business model.
Different types of open innovation
When you think about open innovation, you might picture NASA’s famous Space Poop Challenge, which was a competition on the HeroX platform to come up with a system that collects human waste from fully-suited astronauts. That’s not the only type of open innovation, however. There are four main ways to implement open innovation in your company. Think carefully about which one is most suitable for the project you have in mind.
Open innovation within your organization
While it may not seem possible to utilize open innovation within your company itself, many organizations have found a way. Typically, intracompany open innovation happens when different departments or teams come together to find solutions. This is ideal if you have lots of confidential information related to a project that can’t be shared outside your organization.
Facebook holds an annual hackathon within the company that gives all of its employees the chance to come up with new ideas alongside someone they don’t normally work with. This is not limited to the developers, but rather gives space for everyone to contribute something innovative.
Are you looking for ways to encourage innovation in your company? Read this.
Collaborating with other companies
Another option is to look to other companies for new ideas. This often involves partnering with another organization for mutual benefit. It works best in situations where companies have something to offer one another.
Samsung is well-known for its willingness to partner with other companies in order to improve its products. The company develops partnerships with startups that contribute new features to its products and also invests in early-stage startups that offer new technologies that benefit Samsung.
Looking to experts
This type of open innovation involves incentivizing experts from outside the company to contribute towards finding a solution that the company needs. It’s a great way to integrate various industries with academia in order to develop transformational ideas. This is suitable for companies in a research-heavy industry that doesn’t leave room for amateurs.
Lilly is a pharmaceutical company that has a special Open Innovation Drug Discovery program that allows researchers to safely share their data. The goal is to discover new drug compounds faster and make them available to a broader market.
Open innovation for all
The last kind of open innovation is available to the public. With this model, anyone can propose a solution. At HeroX, this is the type of open innovation we encourage on our platform because it promotes a diverse array of ideas, any one of which can be the solution you’ve been looking for. Due to the limitless possibilities it invites, this method is great for any company that wishes to find the best solution possible.
Lego has mastered this type of open innovation by allowing users to contribute product ideas. That’s how the Lego Big Bang Theory set was born as well as the Vincent Van Gogh Starry Night Lego kit which was approved in February.
Which industries can benefit from open innovation?
Companies in every industry can find a way to use open innovation to their advantage. At HeroX, we’ve hosted challenges for everyone from Lockheed Martin to World Vision to IBM to the US Department of Agriculture to the NFL.
The medical industry has greatly benefitted from open innovation in the past. Projects such as the United Genomes Project strive to overcome the slow process of old-fashioned medical R&D by providing an open-source genetic database that allows researchers from all over the world to develop personalized medicines.
Another place where open innovation is thriving is the software development industry. Mozilla utilized open-source software development to establish its Firefox browser. Now, people contribute to Mozilla by reporting bugs to the company and proposing ways to fix them.
No matter which field your organization is in, our experts at HeroX can work with you to develop a challenge that suits your needs. Innovation knows no bounds. Bring your organization into the next era by choosing HeroX as your open innovation partner.
