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Open Innovation - The Theory of Abundance

Open Innovation - The Theory of Abundance
Murali Dharan Haragopal - Head of Global Insurance Business Solution Group | November 13, 2018
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This topic has been popular in recent times for a single reason that it embraces “theory of abundance” and not scarcity. You may be asking what the relevance of abundance is here.

The “abundance” refers to a storehouse of “ideas.” We might not remember the number of times we would have got free ideas, which has either reduced our effort, improved our happiness quotient, or resulted in financial benefits. Anything which we use, from public infrastructure, communications, applications/software, listening music, food recipe, car-pooling, maps, and so on, are all results of Open Innovation in different forms and shapes.

Here is how Open Innovation can help us mitigate Next-Gen Financial Services challenges - #openinnovation @HCLFS

Often Open Innovation ideas are offered by entities even without asking; this is “outside in.”  Similarly, the reverse has happened that we give our ideas to others (our friends/colleagues/neighbors, etc.,) to support their needs; this is called “inside out.” 

If the same takes place on a larger scale covering various organizations, government bodies, entrepreneurs, start-ups, individuals, partners, and others with an aim to make them formally share ideas in a formal way with a business model then it will obviously have inherent challenges.  Let us go through some of those:

  1. Identifying the right partners:  If the organization does not select the right partner for collaboration, it will end up wasting resources resulting in limited results. This requires careful planning.
  2. Trust and IP right protection: If the ground rules are not set, it will be an incomplete collaboration. Henry says “outside in” has been successfully followed as there is no sharing but using/leveraging, whereas “inside out” still has not got to that level due to various issues which include IP issues, and collaborative sharing.
  3. Cultural aspects: Knowledge leakage and a demotivated team hampering the process of moving forward
  4. Absorptive capacity: Inability to identify, acquire, disseminate, or apply external knowledge
  5. Funding and participation of management: Initiatives will see no implementation – loss of confidence and paralyzing the attempts to move further

While the above challenges are just the tip of an iceberg, we will consider these as first level challenges and find out how we can mitigate them as discussed below:

  1. Open Innovation platform with Block-chain Technology

    Though there are platforms like BrightIdea, Hyve, Imaginatik, Chaordix, Hype, Spigit, Innocentive, IdeaScale, Innovationcloud, Cognisteamer, Eideabox, etc., Blockchain 3.0 has all potential to become a major transformational platform for Open Innovation.  The reason being blockchain technology has all attributes from checking partner/corporate/individual authenticity, recording of IPs/ smart contracts, and is also embedded with reward mechanism (maybe in the form of coins), which are quintessential for the Open Innovation strategy.

  2. Transform to a collaborative culture using scaled agile:

    This transformation to a culture of inclusiveness and having a shared atmosphere requires serious efforts from various stakeholders internally (way from top management to the executors, also extending to like-minded partners. This change could be done only if the organization/entity starts adopting different methodology– like the Scaled Agile framework and adopt tools and techniques that could help to bring the transformation required.

  3. Eco-funded model:

    Open innovation focuses on collaborative efforts and requires decent investments in the initial stages which includes brainstorming, creating POC, labs, Hackathons, etc. Corporates/Entities/Governments not only need to invest commercially but also bring in their IPs/licenses wherever needed. This will help gain visibility and take to different markets wherever relevant.

  4. Bringing together – effective integration management

    Identifying the right internal employees, external partners, corporates, start-ups, and consumers together will be a mammoth task. This requires a very robust team to handle the integration of various stakeholders for a common cause or problem. Some of the effective program management skilled people will be required for this – with an understanding of the relevant domain, regulatory norms, impacts, risks and mitigation plans with reliable decision-making expertise. This group should be at a level of orchestrating group discussion, hackathons or workshops and also need to have subject knowledge to bring in external innovations with negotiations.

  5. Engineering at scale:

    Open Innovations will not be successful unless they are scalable and future-proof.  This requires an engineering DNA to be embedded into the mix. Engineering is not to be mere optimizing the output but to help to build models which could help to resolve future problems which might occur and should be able to scale to regions beyond its scope. It is also important to devise a strategy to take it externally without many dependencies.

  6. Experience to expertise:

    Finally, Open Innovation does not require labor-intensive skills. Open Innovation requires a full-stack people. A person who can multitask, leverage techniques learned from one set of expertise to other areas – for example, a functional consultant can be ideal for doing integrated testing, are very critical for an Open Innovation strategy to be successful.  This will allow the team to complement and supplement their expertise as required in the collaborative exercise. Selection of the right candidate is very crucial for this.

While many companies are attempting POCs and practicing Open Innovation in parts– like P&G, Lego, Bagel (having case studies published already by www.researchgate.net and business2community), they are pinning down to a point very clearly – a dire need of robust framework and associated tools together.

HCL in one of the leading IT companies in the world. It has pioneered in the subject of Open Innovation in a highly crowded emerging market (especially India) since its beginning in 1970s, has delivered substantial benefits collaborating with governments, corporates, partners, consumers, employees, and customers all together, and has also built an award-winning platform delivering $1 bn of values to their customers through their employees (Ideapreneurs).  


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