They say teamwork makes the dreamwork.

Innovation is at its peak. Earlier, companies would keep their blueprints, R&D, strategies, and other intellectual properties locked inside the walls of the organizations. But thanks to advancing technologies, social media, other invaluable resources like customer feedback readily available, those boundaries are disappearing. Knowledge is flowing from company to company and relationships are becoming stronger in the industry. This changing way of business is creating a new world of open innovation.

Open Exchange Of Ideas

Henry Chesbrough, educational director of the Garwood Center for Corporate Innovation at Berkeley Haas coined the term 'open innovation'. It is essentially a practice of collaborating with a group of people (in business they can be customers, suppliers, and competitors) to solve business problems, generate new ideas, and efficient ways of product development.

What can now be called 'closed innovation'  is concerned with doing all the above activities within the privacy of the organization. But open innovation helps companies across industries to have an open exchange of ideas that leads to new ideas to accelerate long-term innovation.

Solving Problems, Faster!

There are several benefits to open innovation. One of them being faster problem-solving. Companies underestimate the power that customers possess. Customers have the first-hand experience of using the said product and their feedback will allow the company to focus on what the problem is. This will save the company time to find the problem, the right solution to the problem, and result in customer satisfaction.

An Array Of Ideas

Via open innovation, a company can get access to diverse skill sets, backgrounds, and experiences. This will benefit the company in being more agile and flexible to the dynamic market demands of this fast-paced world. It might also help companies to come with ideas that they could not think of in the first place. As Chesbrough says, "Useful knowledge today is widely distributed, and no company, no matter how capable or big, can innovate effectively on its own".

More Data, Better Decisions

Data and innovation go hand and hand. The more ideas a company has, the more data they have to analyze to make strategic decisions. These decisions help create new products, services, and revenue streams. It has been proven that data-driven business decisions are cost-effective and minimize R&D risks by ensuring the products built are unique and customer-centric.

Incorporating Open Innovation Into Business Strategy

Now that you know the benefits of working under open innovation, you need appropriate measures to get started.

According to Unilever and GSK Consumer Healthcare, the "Want, Find, Get, Manage" process helps organizations to divide their open innovation plans into four phases:

Want Phase – In this stage, organizations should identify gaps in their innovation and assess whether these gaps can best be internally or externally.

Find Phase – This second stage is about deciding which external group will help the company develop the necessary capabilities to plan according to the ideas and knowledge from these external sources.

Manage Phase – The last stage concerns the tools and metrics that the company must use to track and monitor their external stakeholder relationships.

Facing The Challenges

One of the major challenges of open innovation is that ideas can sometimes get lost and are not executed. In such situations, it can be difficult to identify the most effective way to move ideas from planning to execution in due time. This can get even complicated when stakeholders and their ideas are involved. This is where open innovation platforms come into play. These platforms have dashboards where every idea is displayed on the feed of each challenge page for everyone to see and collaborate. One such platform, Idea Drop, allows communication to happen via mobile also which allows people to access it and work on it from remote locations.

Open innovation is heading innovation towards the future. If done right, it can change the way businesses operate. What do you think? Tell us in the comments below.