We are now on the brink of a major evolution of open innovation according to an article by John Hagel and John Seely Brown in BusinessWeek. They describe the success of Innocentive, the first global Internet-based platform designed to help connect Seekers, those who had difficult research problems, with Solvers, those who came up with creative solutions to these problems.
Since 2001, more than 170,000 participants from over 175 different countries have registered as Solvers. More than 800 problems have been posted, and almost 400 solutions have been found. This represents almost a 50% success rate on problems that had stumped internal research and development staffs. Almost $20 million in awards have been posted, while almost $4 million in awards have been paid out to successful Solvers.
They conclude by asking what can we learn from Innocentive’s success?
1. Diversity enhances problem-solving
Research on problem-solving success rates clearly indicates that diversity increases the probability of coming up with a solution to challenging research problems. A surprisingly large portion of the solutions come from Solvers in very different disciplines.
2. Scale matters
Serendipity is most likely to occur when a large number of diverse participants are aggregated in ways that expose them to a broad range of challenging problems.
3. Governance is critical
Contrary to the popular view that open innovation is self-organizing and emergent, problem-solving platforms like InnoCentive’s are carefully structured to protect intellectual property and specify decision rights and reward distribution in advance.
4. Teams amplify the power of individuals
Even on a platform initially designed to support individual problem-solvers, teams began to form to increase the probability of success in challenging big problems.
5. Relationships trump transactions in successfully tackling a broader range of problems
As InnoCentive has begun to specify more explicitly the four levels of problem-solving, it realized that short-term transactions are effective in addressing only a limited set of well-defined problems. The broader and more diffuse a problem becomes, the more important it is to foster longer-term relationships among aspiring problem-solvers.
6. Learn from others in building open innovation platforms
Even though InnoCentive is a pioneer in deploying an open innovation platform, it is carefully studying efforts by other groups to support collaboration and learning from their efforts. Recent initiatives at InnoCentive have been inspired by social networking platforms, shared workspace providers, online discussion forum sponsors and even online gaming.
7. Open innovation has value within companies
While the practices and platforms designed to support open innovation initially were focused on reaching beyond the enterprise, these same practices and platforms have application within the enterprise as well. The company has developed a specific offering known as InnoCentive@Work that allows companies to post challenging research problems solely to its own employees. Again, it is difficult to specify in advance which individuals, teams or even disciplines are likely to generate successful solutions, so executives are finding that solutions often arise from unanticipated parts of the firm.
The Innocentive model is the basis for the new style of Open Innovation.
Paul Sloane
