Ri Open Collaboration Innovation


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Open collaboration strategies for SME\'s that want to drive innovation and productivity in organizations

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Ri Open Collaboration Innovation

  1. 1. Utilizing Open Collaboration Principles to Drive Innovation and Increase Productivity<br />The What, Why and How for SME’s interested in Open Collaboration<br />Suresh Fernando<br />Partner, Radical Inclusion<br />Dec. 4, 2009<br />suresh@radical-inclusion.com<br />
  2. 2. “Imagination is more important than knowledge”<br /><ul><li>Albert Einstein</li></li></ul><li>“Given enough eyeballs, all bugs are shallow!”<br />Linus’ Law<br />
  3. 3. A Few Assumptions…<br /><ul><li>You want more clients!
  4. 4. You want to save money
  5. 5. You want deeper client and partners relationships
  6. 6. You want to be ‘more connected’
  7. 7. You want to be more intelligent: more knowledge, better information processing
  8. 8. You want to innovate
  9. 9. You want to run your organization more efficiently</li></li></ul><li>What We Want To Accomplish<br />Ensure you understand what open collaboration is<br />Ensure you understand how the principles of open collaboration can be used to drive innovation and increase productivity in your organization<br />Ensure you understand the challenges you will face and how we can help you to overcome them<br />Identify specific models that might be applicable in your organization<br />Describe Strategy and Implementation processes that will give you an idea how we will work with you.<br />
  10. 10. What is Open Collaboration?<br />What is collaboration?<br />The sharing of risks, resources, responsibilities and rewards<br />The co-creation of content<br />What is Openness?<br />the collaboration strategy will reach across existing corporate boundaries. <br />within the organization (inter organizational) <br />across different organizations (intra organizational).<br />
  11. 11. Why Implement an Open Collaboration Strategy?<br />Fostering Innovation<br />Solving defined organizational problems<br />Develop new products and services<br />Modify or develop internal processes<br />Increasing Productivity <br />Reduce costs: using virtual meetings to reduce travel costs, for example<br />Increase Frequency and Efficiency of Distributed Meetings: virtual capabilities allow organizations that operate across boundaries to collaborate more effectively<br />Enter Into New Markets: This can be accomplished by joint development strategies, for example<br />
  12. 12. Management/<br />Admin.<br />Sales<br />Accounting<br />Inventory<br />Open Collaboration<br />Inside the Enterprise: across functional groups<br />Eliminate silos<br />Introduce platform to connect business units<br />Operations<br />
  13. 13. Open CollaborationOutside Organizational Boundaries<br />Enterprise Ecosystem<br />Client<br />Client<br />Client<br />Services Layer<br />Organization<br />Partner<br />Partner<br />Service Delivery Layer<br />Support: Financing, Volunteers<br />Support Layer<br />
  14. 14. Successful Open Collaboration Strategies<br />Larger Organizations<br />
  15. 15. Which of the following models might work for your organization?<br />
  16. 16. Strategies You Can Implement With Open Collaboration<br />Solve an internal problem by crowdsourcing<br />Generate new product and service ideas by creating an innovation community<br />Transform corporate culture by connecting your organization<br />Co-creating products and services with your clients<br />Developing collaborative research with clients and partners<br />Forming a collaborative marketing association<br />Forming a collaborative procurement network<br />
  17. 17. GoldCorpMobilizing an External Community to Solve an Internal Problem<br />Goldcorp is a mining company that was faced with an underperforming mine based in the Red Lake area in Ontario, Canada<br />They decided to open up their data on their mines via offering $575,000 in prize money to virtual prospectors.<br />Within short order over 1400 mathematicians, students, consultants and of course geologists from over 50 different countries had downloaded the data<br />The contest winner, a collaboration between Fractal Graphics and Wall & Associates from Australia, no member of whom had ever even seen the mine, built a powerful 3-D rendition of the mine.<br />Subsequent drilling resulted in striking gold in four of the first five recommendations from the winners.<br />In 1996 the mine produced at an annual rate of 54,000 ounces/year<br />In 2001 it was producing at an annual rate of 504,000 ounces/year<br />
  18. 18. Proctor & GambleDeveloping a Collaborative Innovation Framework<br />P&G implemented their Connect & Develop strategy to partner with other organizations to drive the organizations Research and Development process. The results have been no less than staggering.<br />Five years after the company&apos;s stock collapse in 2000, P&G has doubled its share price<br />Has dramatically increased the number of partnerships, licensing agreements etc. increasing rate of successful innovations threefold. <br />Today, more than 35 percent of P&G’s new products in market have elements that originated from outside P&G, up from about 15 percent in 2000<br />45 percent of the initiatives in P&G’s product development portfolio have key elements that were discovered externally<br />R&D productivity has increased by nearly 60 percent<br />P&G’s innovation success rate has more than doubled, while the cost of innovation has fallen<br />R&D investment as a percentage of sales is down from 4.8 percent in 2000 to 3.4 percent today<br />Internal Branding: “Connect and Develop” and “50% Rule” – 50% of all new innovations to come from external partners<br />
  19. 19. IBMFostering Innovation and Transforming Corporate Culture<br />IBM developed social media strategy to connect their 380,000 employees (50% of which are mobile) and 200,000 contractors that are spread across 2000 offices in 50 countries.<br />ThinkPlaceis an open discussion forum where ideas can be submitted, modified and reviewed collaborative by anyone in the organization<br />Beehive is an enterprise social networking site similar to Facebook. Employees report that they use Beehive to essentially humanize their workplace by getting to know employees on levels that are not visible from within the corporate environment.<br />Jamming is a real time mass collaboration brainstorming session. In 2006, IBM held InnovationJam, an internal brainstorming session that engaged 150,000 people from 104 countries and 67 different companies.<br />
  20. 20. LegoEmpowering a User Community to Co-Create Products<br />Lego has developed a complete social media/consumer engagement strategy that includes a number of different touchpoints; a fan club, a social network, online movies, online games, and message boards. They are also working on a massively multiplayer game.<br />What is most interesting is that they have opened up their software design process to roughly 120,000 designers who can design their own products. This serves the purpose of engaging closely with those that most care about the brand.<br />
  21. 21. IntelDeveloping a Collaborative Research Framework<br />Traditional, roadmap driven research processes have been found to be strategically inadequate because:<br />New technologies and products that might lead to new business lines and the altering of corporate strategy.<br />Disruptive innovation that might threaten the existing product roadmap.<br />In order to address this strategic constraint, Intel has made a commitment to developing and driving exploratory research processes. The four pillars of this strategy are:<br />Providing collaborative research grants<br />Developing collaborative research facilities in close proximity to universities<br />Providing corporate venture capital<br />Driving specific corporate research projects <br />See Appendix for further details<br />
  22. 22. The Open Innovation AttitudeHow successful collaborators think<br />Reference: Chesbrough, H. (2003), &quot;Open Innovation: The New Imperative for Creating and Profiting from Technology&quot;, Harvard Business School Press.<br />
  23. 23. The Open Innovation Attitude How successful collaborators think<br />Reference: Chesbrough, H. (2003), &quot;Open Innovation: The New Imperative for Creating and Profiting from Technology&quot;, Harvard Business School Press.<br />
  24. 24. What is the relationship between open collaboration and innovationyou ask?Scalable Team Thinking<br />No geographic<br /> or time constraints<br />A problem we <br />all want to solve!<br />
  25. 25. What is the relationship between communications and collective intelligence?Scalable Information Development<br />No geographic<br /> or time constraints<br />An information repository<br />We build together!<br />
  26. 26. Why Open Collaboration Works<br /><ul><li>Leverage Collective Intelligence of whole organization… plus others outside organization
  27. 27. Empowers all members of organization: ‘mailroom to boardroom!’
  28. 28. Fosters innovation and creativity
  29. 29. Cultivate leaders within the organization
  30. 30. Leadership lies with contributors, not established hierarchy
  31. 31. Team Participation can Scale
  32. 32. More resources
  33. 33. More ideas
  34. 34. Creates culture of openness and transparency
  35. 35. Creates sense of being part of much larger whole</li></li></ul><li>Why Open Collaboration Works<br />Acknowledges diversity of employee skills – not ‘pigeonholed’<br /><ul><li>Direct organizational benefit: access to additional knowledge
  36. 36. Indirect organizational benefit: makes employees feel ‘fully valued’.</li></ul>Connects organization across boundaries<br />Creates dialogue that results in new clients, partners…<br />Creates dialogue that results in different perspective – thought is not constrained by organizational ‘group think’<br />Information transfer accelerated – is viral<br />Distributed Collaborative Intelligence: proportional to size of group<br />Generates knew organizational knowledge; synthesis of cross boundary information<br />
  37. 37. Three Basic Ways To Capture Value from Open Collaboration<br />Monetizing what is Co-created<br />Developing Associated Products or Services: <br />RedHat, for example, built a business providing consulting services in support of the Linux operating system.<br />Indirect Benefits<br /> Position your organization as leaders in the community, develop brand recognition within the community etc.<br />
  38. 38. Challenges To Implementing Open Collaboration Strategies<br />Effective collaboration will take time<br />Agreeing on common goals is difficult<br />Leadership needs to think differently<br />Organizational culture needs to be changed<br />Developing trust is difficult<br />Resources for new projects are scarce<br />Providing correct incentives to stakeholders<br />
  39. 39. Fortunately we will help you to address these challenges!<br />
  40. 40. From Networking To CollaborationUnderstanding the Evolution<br />Prahalad and Ramaswamy, The Collaborative Continuum, Collaborative Strategies, Nov. 2001, p.3<br />
  41. 41. From Networking To CollaborationUnderstanding the Differences<br />Prahalad and Ramaswamy, The Collaborative Continuum, Collaborative Strategies, Nov. 2001, p.3<br />Camarinha-Matos, Luis M.; Afsarmanesh, Hamideh; Galeano, Nathalie; Molina, Arturo, Collaborative <br />
  42. 42. What Mistakes Should You Avoid?<br />Focusing excessively on reducing costs as opposed to increasing revenues.<br />Ineffective leveraging of collaboration partners<br />Superior capabilities<br />Local knowledge<br />Failure to align collaboration and business strategy<br />
  43. 43. What are the Key Strategic Considerations?<br />Ensure that the strategy is an organizational one<br />Connect Your Collaboration Strategy to your Business Strategy<br />Develop a clear leadership message<br />Develop a culture of trust and openness<br />Be willing to challenge existing organizational assumptions<br />
  44. 44. Identifying Your Goals, Objectives and Priorities<br />Radical Inclusion has designed a questionnaire that will assist you to determine your organizational goals and what the best way to structure your open collaboration process is.<br />
  45. 45. Open Collaboration FrameworksStructural Possibilities<br />Adapted from Pisano, Gary and Verganti, Robert, Which Kind of Collaboration is Right for You?, Harvard Business Review, 2008.<br />
  46. 46. Open Collaboration FrameworksIntra-Organizational<br />Adapted from Pisano, Gary and Verganti, Robert, Which Kind of Collaboration is Right for You?, Harvard Business Review, 2008.<br />
  47. 47. Advantages/Disadvantages of Particular Frameworks<br />Adapted from Pisano, Gary and Verganti, Robert, Which Kind of Collaboration is Right for You?, Harvard Business Review, 2008.<br />
  48. 48. Advantages/Disadvantages of Particular Frameworks<br />
  49. 49. Selecting the Correct Framework<br />Depends on Organizational Goals and Priorities<br />See the Radical Inclusion Organizational Assessment Questionnaire for a systematic method of assessment that maps from organizational goals to the correct framework<br />
  50. 50. Open Collaboration Strategic ProcessesFrom goals to implementation<br />
  51. 51. Collaboration ModulesStrategy and Implementation<br />We expect that the overall process of engaging with enterprise clients to assess their existing strategy and to formulate and implement new strategy that will utilize open collaboration principles to drive innovation will be a modular process.<br />The delivery will be in the form of specific modules that address the needs of a strategic initiative.<br />
  52. 52. Open Collaboration Strategic ModulesFiguring Out What To Do... <br />Open Collaboration Strategy Assessment<br />Open Collaboration Testing<br />Selecting the Correct Collaboration Framework<br />Assessing Collaboration Aims<br />Developing the right Governance Mechanism<br />Selecting the Correct Tools<br />Formulating the Collaborative Community Development Strategy<br />
  53. 53. Open Collaboration Implementation ModulesDoing It<br />Identification and Engagement of Key Stakeholders<br />Developing Culture of Trust and Openness<br />How To Build Virtual Teams<br />Running Successful Virtual Meetings<br />Developing Collaboration Spaces<br />How To Market Your Strategy Internally<br />