Collaborative Innovation Takes the Global Stage

02 Feb 2008|Tim Hyer

As a Business Development Manager, a huge part of my job here at Cheskin is secondary research. Aside from client calls and meetings, I find myself spending the majority of my time online, investigating company news, industry shifts, and latest business trends. It’s important for me to track down the most relevant and current information, so it may come as a surprise that my homepage is Wikipedia. Not Hoover’s. Not BusinessWeek. But Wikipedia.

In my opinion, Wikipedia is the one-stop-shop for getting the most up-to-date and multifaceted information. Sure, Wikipedia has its share of critics about its lack of authority as a serious reference material, and I can appreciate this perspective. Wikipedia is never my sole source of insights, but rather, a launching pad of links that directs me to even more credible sources that I may not have otherwise found. I’m comforted to know that any given entry in Wikipedia can be clarified, improved, and expanded upon by thousands and thousands of knowledgeable contributors on a daily basis. The reason I have so much trust in the wiki model is because I’m a firm believer in the collaborative philosophies behind books like The Wisdom of Crowds and Group Genius. These books speak to the power of collaboration and harp on the theme that no single individual is smarter than the collective intelligence of the group. The principle of collaborative innovation demolishes the theory of the lone genius and gives way to transparency and openness. This is the beauty of the open source model – ideas, content, and insights are generated by the many vs. the few. Individuals are able to step outside of their silos and build on the ideas of others to jointly create an ultimately stronger solution. This is where the success of projects like Linux, The One Laptop Per Child Initiative, and The Human Genome Project are unmatched.

Collaborative innovation is not a new concept, but something few organizations have been able to appreciate until very recently. Since the Industrial Revolution, traditional R&D operated behind closed doors. Consumer products were developed only within the walls of a company with very little focus given to the end user. Such was the case for consumer goods giant Procter & Gamble. For generations, P&G did very well innovating from within – building global research facilities and hiring and holding onto the best talent in the world. But as the world became flatter through an explosion of new technologies, the world’s innovation landscape changed. Through the internet, information and talent became globally accessible. Individuals, entrepreneurial companies, and research institutions began licensing and selling their intellectual property and sharing became the norm. P&G realized this shift and was forced to adapt in order to survive. CEO A.G. Lafley instituted a new company-wide strategy to look “outside the box” for external sources of innovation. P&G successfully used technology and networks to seek out new ideas for future products in a model they dubbed “connect and develop.” Very much in-line with The Wisdom of Crowds, P&G estimated that for every in-house researcher, there were 200 scientists and engineers elsewhere in the world who were just as good. This meant approximately 1.5 million people whose talents could potentially be used. There was a shift in the perception of P&G’s R&D organization from being 7,500 people inside to 7,500 plus 1.5 million outside. The open innovation model worked – since the R&D shift in 2000, P&G has more than doubled its stock price. The company develops more than one third of its new products externally and currently has a portfolio of over twenty billion-dollar brands.

Through the leadership of future thinking companies like P&G, collaborative innovation is a growing part of the global economy. Henry Chesbrough, who authored the book Open Business Models: How to Thrive in the New Innovation Landscape has pioneered a Center for Open Innovation at UC Berkeley’s Haas School of Business in order to educate the next generation of business leaders to think outside the four walls of closed innovation models. More and more companies like Adobe Systems are presenting opportunities for outsiders to submit ideas and contribute to the success and advancement of the company through strategic relationships and partnerships. Then there are companies like YouTube and Threadless, a T-shirt company whose designs are fueled solely by community submissions, who are built completely upon a foundation of collaborative innovation. In December 2007, McKinsey published a study on the eight business trends to watch in 2008. Topping the list were the following:

1. Distributing cocreation
2. Using consumers as innovators
3. Tapping into a world of talent

Innovation through collaboration is alive and well in the business world and is making huge strides on the global stage as well. Last week’s World Economic Forum in Davos, Switzerland brought the idea of open innovation to a whole new level with the theme, “The Power of Collaborative Innovation.” For five days, global leaders from multiple disciplines – business, government, civil society, intellectuals – came together to address some of the world’s most dire challenges of economic instability, climate change and equitable growth. The WEF recognizes that these challenges are larger than any one country can handle and will require the collective innovation of global task forces to overcome. As Prime Minister of Japan Yasuo Fakuda said, “Collaboration, the main theme of this year’s Davos meeting, is the keyword to make progress on the issues of climate change, Africa’s development and the global economy.” But the five days in Davos was only the beginning. Even the WEF recognizes its own exclusivity as an elite organization. In the true spirit of collaboration, the WEF took cross-functional transparency to a new level by allowing citizens to submit their thoughts and questions around the WEF via YouTube. Remember, collaborative innovation is dependent upon the contributions of the many. The global conversation continues at http://www.davosconversation.org/. So go ahead – get your voice heard. Collaborate. Who knows, maybe your contribution will lead to the next innovation to help change the world.

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