Monday, December 21, 2009

Can open innovation give a competitive edge?

I believe it certainly can! Even more so, I believe a small company must use it to be able to compete against 'big boys'.  (if you don't know what open innovation is, take a look at the Wikipedia ). My current full-time job is in the technology sector, working inside an RnD site about 1000 people strong. In my daily work I get to work with small(er) size subcontractors, companies ranging from 10 to 150 employees. My observation in the past couple of years is that 'big' is not always beautiful and 'small' is not much better. But open innovation could change this in favor of smaller sized companies.  What are the strengths of a big RnD? Usually it is a decent research budget and a large knowledge pool. Project organization is usually well organized, making it possible to handle very large projects (>50 fte). I've also experienced that these advantages come at a cost: bureaucracy, ill communication, heavy overhead, 'political' decisions etc. This is common to most large RnD's , as illustrated by Dilbert cartoons. Reading them daily I often find them spot-on, equally applicable to European and American companies alike.
Smaller companies have their own disadvantages. While being extremely agile and efficient, they often lack professional organization and broad know-how. If only they could get the knowledge they need....
This is where open innovation provides a competitive edge. I believe that the ways of doing research have been changing for the last couple of years and the rate of change is increasing. Information becomes readily available making it easier to build on ideas of others rather than reinventing the wheel.
I've started this blog with open innovation in mind. Here I'll try to
- share my ideas. Many of them will be incomplete, unpractical or just plain wrong. I really hope to get enough feedback to filter out the better ones.
- share specifics on things that don't work. In my professional work the 'don't do this' advice has proven to be most valuable. Hopefully I'll help somebody spare some time to come up with really great ideas (and then of course share them).
A great example of open innovation in action: today I've come across this post. It really helped me to get a couple of thoughts together that have been floating in my head for weeks. Thinking of these ideas as puzzle pieces, I now know that all the pieces are there. Now I can start the tedious work of putting them in place.

1 comment:

  1. I've enjoyed reading your posts, and I like the direction you're going in! I too am trying to setup a pair trading operation, and like you, I am going for safe bets. Perhaps we can collaborate in the future!