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4 Problems Facing Open Innovation

Posted on  14 October 10  by 

Comment (4)

This is the first installment of a 3-part debate on the benefits of open innovation.

Companies are increasingly looking to radical innovation for a step-change in growth, but struggle to generate truly radical (yet feasible) ideas. In search of better-quality breakthrough ideas, most innovators are turning to open innovation.  They are opening the floodgates to ideas from anyone and everyone – from employees, to customers, industry experts and beyond – usually via an online platform. The aim is to tap into the creativity of the masses and to lessen the idea generation burden on the innovation team itself.

But do more ideas automatically mean more good ideas?  I don’t think so. And, indeed, one of our members reported that for every 1000 ideas submitted on an open innovation platform, on average just 1 will be truly radical.  I believe this is due to several limitations of the open innovation model:

  1. Lacking focus. Many open innovation platforms welcome any and every idea. This is a great way to gather ideas for incremental product/service improvements and determine which have mass appeal, but is unlikely to produce many radical ideas. To boost the likelihood of generating radical ideas, you need everyone to focus on the biggest and most urgent customer problems and dedicate a lot of thought to potential solutions.  It’s about depth of thought not breadth of ideas.
  2. Insufficient customer understanding. Generating a truly radical idea requires deep understanding of customer needs.  Most employees and even most customers won’t have sufficient insight into customers’ most urgent unmet needs, especially as these are often unarticulated/unconscious needs.  An open innovation platform can provide some information on the customer need, but is typically limited in how much detail it can share (due to both technology and IP issues).
  3. Limited room for discussion. Ideas aren’t the individual “eureka” moments we tend to think they are.  In fact, they’re usually a combination of ideas and multiple reworkings and evolutions.  The process of building on and refining each others’ ideas requires a greater degree of discussion and collaboration than comment boxes on open innovation platforms can offer.
  4. Status Quo Captivity. Coming up with radical ideas requires breaking out of the way things are and imagining future possibilities, which is hard to do alone.  As a result, the majority of ideas submitted on open innovation platforms involve small tweaks to current solutions for exisitng needs and problems.  Innovation teams are better at envisioning the future (and thus producing radical ideas) thanks to creative thinking excercises and knowledge of emerging trends and new technologies.

As a result of these four problems, open innovation platforms often fall short of their radical innovation goals. The result is not to lessen the burden of effort on the innovation team, but actually to increase it.  Filtering through all the low-value, irrelevant ideas submitted on open innovation platforms is an inefficient use of time.  Additionally, open innovation creates a tricky expectation management challenge – how do you avoid demoralizing or angering employees/customers whose ideas aren’t selected?

What’s needed isn’t an ever wider idea footprint.  Instead, it’s tighter focus on high-potential opportunities, deeper insight into customer needs, and more time thinking, discussing, and building onto other ideas.  The solution is almost the exact opposite of an open innovation platform: an intensive innovation workshop with less than 8 people. This is the optimal size for maximizing idea volume and debate while minimizing group-think.

Watch this space for the counter-argument next week.  In the meantime, please share your views!

MLC members, for information on how to run a best-in-class innovation workshop, please see this case on Unilever’s Customer Insights Lab.

Comments from the Network (4)

  1. Melissa
    on October 19, 2010
    Respond

    I’m looking forward to the next two parts of this discussion. Similarly, I wonder whether “unconferences” are categorized as a type of open innovation, or as something completely independent.

  2. Mike
    on October 21, 2010
    Respond

    Here is the problem … who determines the 8 people in the room? Are they loudest? The highest paid? The ones who have the ivy degree? You get where I am going with this. At some point in time you have a single point of failure in the innovation process — that is the person that makes the agenda. While full open innovation may seem too messy to be effective, why isn’t there a middle ground where 8 people ignite and openly collaborate with everyone, and perhaps, out of everyone comes #9 or #10.

  3. Mark
    on October 27, 2010
    Respond

    To help with determining the 8 people who should be in the room, you can start with making sure you’ve got the right ‘Voices’ in the room.

    Voice of Intent: This Voice provides the inside / out perspective. It sets the vision, purpose, boundaries and success measures. It authorises the work, the approach to the work, makes the key decisions, and provides the needed resources. This Voice knows how the work or the fit of the idea into the wider organisation.

    Voice of Experience. This Voice provides an outside / in perspective. It represents people who experience a product or a process hands-on. This Voice seeks to make the customer’s (internal or external) needs, wants and concerns the main focus of the design and implementation process.

    Voice of Design. This Voice provides the expertise and focus for conceiving and building a solution. This Voice brings a variety of specialities or knowledge to the design and implementation process. It shapes and articulates a solution based upon the inputs provided by the two other Voices – bringing judgement about what is appropriate to the scale, function, and form of the solution. This Voice must ask and answer the what, who, how and why.

    The ‘Voices’ are a concept from a company called Second Road http://www.secondroad.com.au

  4. Doug Martin
    on November 4, 2010
    Respond

    I was involved in the creation of an ideas database at my company, and would agree based on my experience that selecting submissions to move forward and acknowledging all contributions are real challenges. It’s an approach that has the benefit of casting a wider net, but does require the engagement of a team that is prepared and resourced properly to test interesting concepts. We’ve also done a few innovation workshops. They’re great for focusing on solutions, but some of the value can be lost without unbiased outsider perspectives, so it’s important to bring those in. A novel approach that we haven’t yet tried is the X-Prize Foundation’s way of open innovation: define clear-cut stretch targets and allow entrepreneuring third parties to bring fresh thinking and new technologies to bear.

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