Open innovation: grasping the nettle
Innovation has become a familiar business buzzword, but ‘open innovation’ – looking beyond company boundaries for new ideas and inspiration – is a relatively new concept, and it’s something CEOs and business leaders should really start taking notice of.
It’s a concept that originated, like so much of today’s business practice, in the IT sector, but has spread to other industries and increasingly SMEs and smaller businesses. These corporations are searching for new ways to be innovative – something my research team and I realised was that more and more organisations were therefore choosing to work with, and draw inspiration from, companies in completely separate sectors and even their own competitors. Some companies were unknowingly already engaging within this concept of open innovation by learning from the companies they were outsourcing to.
Yet open innovation can’t just be viewed strategically. Indeed, from a board-level perspective there is a straightforward case to be made for sharing information that allows a company to profit from outsiders’ experiences, but the more we looked into it, the clearer it became that, many organisations were having trouble implementing open innovation having made the decision to adopt it.
An initial realisation was that open innovation thrives in a business culture that’s adapted to its needs – it requires a total change in the way both employers and employees think about sharing information with external parties to produce results. Managers and leaders must move away from the protectionist mindset that’s become embedded in organisational culture and, instead, infuse their organisations with the values of sharing.
Some managers begin with sending employees on joint training courses with employees from rival companies specifically so they can share ideas and information with workers in their market, while some invite external parties in to offer new perspectives. There are organisations that encourage employees to put themselves forward as speakers at events or include customers in their training programmes. Alternatively, teambuilding events attended by different divisions can be used to kickstart innovation.
If we focus on these employees on an individual basis, they need to be able to work with other businesses while being in full control of their own projects. It’s a balancing act. They need to gather contacts and create a network to procure fresh ideas and widen their outlook. Having an ability to switch between teams is important, being able to thrive within an organisation and beyond it. Employees who are not encouraged to innovate outside the bounds of their business unit simply won’t do it – it requires an altered attitude.
Taking the issue of re-recruitment as an example of changing organisational attitudes, for many organisations it seems unnatural, but instead of being perceived as disloyal this could be an opportunity to benefit from new expertise. The employee already knows how the company operates and can return with ideas on how to improve the business. Imagine employers as football managers – loaning players to another club, letting them gain two years’ experience and then taking them back.
Ultimately, it’s an easy decision to employ an open innovation strategy, but the challenge comes in developing a business culture designed to encourage employees to share experiences and knowledge with others. If this can be achieved, open innovation has the potential to change the way an entire company thinks and operates. And it’s about time businesses fully embraced its ways.
Katleen De Stobbeleir, Professor in Human Resources Management & Leadership, Vlerick Business School, teaches leadership, professional management skills and feedback skills in the open enrolment and customised programmes at Vlerick. She is also involved in the Research Centre on Coaching, a centre that develops tools and conducts applied research on leadership trends and coaching. Passionate about developing leadership at all organisational levels, Katleen is an expert in people management, creativity, learning and development. Her research has been published in several international journals and books. She is one of the few Belgians to be published in the renowned Academy of Management Journal.