Article: What can you learn from design organizations about open innovation?

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What can you learn from design organizations about open innovation?

Ideas generated by open innovation do not often translate into new products and offerings of participant companies.
What can you learn from design organizations about open innovation?

Yoshiaki Shiraishi was watching a beer bottle assembly line when he came up with the idea of kaiten zushi (“turnover sushi” in English). The idea of the ‘turnover sushi’ is to place the plates with different varieties of the garnished rice dish on a conveyor belt and revolve it around every table and counter seating people. Customers can pick the sushi of their taste as plates full of the Japanese dish revolves around them. Shiraishi studied the use of the conveyor belt and after five years of development opened the first conveyor belt sushi restaurant in ‘Mawaru Genroku Sushi’ in Higashiosaka in the year 1958 [i]. Shiraishi showcased the example of pioneering innovation using inspiration from an industry other than his! It is a classic example of creatively adapting innovations of other industries to yours and reaping business benefits. BMW learned from the gaming industry and introduced iDrive; Ray Kroc, the McDonald’s founder realized he was in the real estate business and not the hamburger business; the world is ripe with examples of such cross-industry innovations. 

Companies, sooner than later, realized the importance of learning from outside, and have adopted this concept called open innovation. “Open innovation is the idea that companies should make greater use of external ideas and technologies in their own business, and allow unused internal ideas to flow out to others for use in their business,” defines the Open Innovation Community. Technology companies in IBM and Intel formalized this concept of collaboration in their own right back in the 20th century. The modern era has seen many companies (like Samsung, GE, Lego, NASA) adopting this idea. These partnerships save costs and generate creative insights. For instance, the electric “spa” concept car has emerged from the collaboration between L’Oréal and Renault. Inter-company partnerships and consortiums are increasing, but these ideas are not translating into new products and solutions as “hoped”, an Accenture study points out. The major challenges for that not happening are deficits in appreciation of ideas, and assimilation of counterpart’s strategies. Organizations have a reflexive bias towards outsiders’ ideas. Hence, these challenges are caused mostly due to inertia towards adopting external ideas challenging the conventionally accepted way of working. These challenges can be tackled by using effective talent management techniques. Because at the end it comes down to the talent (who are spearheading the open innovation concept) to develop political strategies to overcome the reflexive bias. 

Design organizations have worked on designing these political strategies and skilling themselves to have their outsider perspective accepted in organizations. Dirk Deichmann, Ieva Rozentale, and Robert Barnhoorn studied seven unique cases of design agencies and conducted in-depth interviews with executives of 16 other to assess what makes them successful at convincing partner companies to adopt their ideas. Their research highlights that ‘cultivation of flexibility and trust’ is what takes design agencies far. And there is a thing or two that companies doing open innovation can learn from them.  The researchers share five strategic actions that successful designers take to cultivate flexibility and trust. We study these strategic actions, and see how they can be applied in the context of organization consortiums:

1. Create a multi-layered network

Do not work with a single point of contact in the client organization. Instead, create a large, dense network of contacts with people at all levels. This increases the chances of being aware of implementation challenges that are being faced at different levels. “A large, dense network helps reduce silo thinking, increasing the odds of creating a more holistic and robust design concept,” the authors explain.

2. Foster equal ownership

It is important for all the stakeholders involved to feel equal ownership and responsibility for the idea to build flexibility into the implementation process. Here is how successful designers do it:

  • Articulate stakeholders’ value: Acknowledge the smallest contributions that a stakeholder has made to the creation and implementation of the idea. This is to make them feel valued. Also, highlight the benefits that a stakeholder will accrue by participating in the implementation.

  • Keep communication open: Facilitate open discussions about ideas, involving every stakeholder. This gives them a sense of ownership of the idea. Use the tools at disposal (like Slack, Yammer, or other collaboration tools) to keep everyone involved. 

3. Establish interim milestones

Do staging of the innovation process. Break down the goal into tangible milestones, “adding steps through the process”. What this does is – it makes the project seem less intimidating as it would have initially. At the same time, this ensures a certain level of transparency as everyone is aware of what milestones have been crossed in the product journey. These milestones help one build support for the project. Since the problem has been broken down into various stages, people can understand easily how they can contribute to which stage. Taking the agile approach, one can reshape the development of the idea at every milestone. 

4. Build an open business case

Articulate a business case which is more open and develops it as you move through the various stages. This gives you the flexibility to adapt and be agile on the go. The stakeholders in the process can then add more input to the business case. In case of partnerships for open innovation, room for flexibility in the business case can allow the participating organizations to adapt to each other’s business objectives and strategies as they learn more about their partners. A rigid business case made without an in-depth understanding of the partner’s strategic goals causes inertia. 

5. Prototype early

Present a minimal viable product which is in early stages of development. A prototype can tell whether it is on track to fulfill the expectations of each partner involved. If it is, then continue with the product’s development. If it isn’t, then make alterations keeping the strategic objectives of each partner in mind, and change the product. “Seeing something concrete also helps people more easily articulate their concerns and give more constructive feedback while an idea is still at a fluid stage,” opine the authors.

These strategies are from the handbook of an agile methodology that is dominantly used in the technology industry. Application from the principles used by design teams can yield better partnerships. The important thing to remember is that the end in mind of the idea implementation process is to create consensus, and not drive efficiency.

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[i] Yokishiaki Shiraishi:Founded Conveyor Belt Sushi Industry

Topics: Innovation, Learning Landscapes, C-Suite, Technology

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