Companies once hired teams of researchers to create the next big thing. Cloistered in AT&T Inc.’s Bell Laboratories and IBM Corp.’s Watson Research Center, for instance, these innovators laboured in privacy, their creativity guarded like state secrets. Often, they worked without much input from customers, partners or suppliers.
The Internet, and hyper competition, has changed that. Increasingly, companies engage outsiders in creating new products and processes.
“Companies are running faster and faster to stay at the same spot,” says Mohanbir Sawhney, the McCormick Tribune professor of technology at the Kellogg School of Management. “To sustain growth, they must drive up by an order of magnitude their speed of innovation. They can do this by tapping their external networks for ideas on staying competitive and developing new products.”
But how? It’s not simply a matter of flinging open the research lab’s doors, Sawhney explains. Indeed, depending on the firm’s nature and goals, a company ought to plot its entry into what Sawhney calls “network-centric innovation”.
Sawhney, who is also director of the Kellogg Center for Research in Technology and Innovation, aims to provide a guide to this frontier with his new book, The Global Brain: Your Roadmap for Innovating Faster and Smarter in a Networked World. Co-authored by Rensselaer Polytechnic Institute professor Satish Nambisan, the book is a “how-to” for managers seeking to engage external communities in innovation.
“The ‘global brain’ is a metaphor for the wealth of talent and creativity in your extended network,” Sawhney says. “Not all the smartest people work for you, and you can’t innovate alone. How do you tap into the global brain to drive innovation and growth?”
Companies successfully exploiting networked resources include Procter & Gamble Co., which commercializes ideas submitted by individual inventors through its “Connect+Develop” programme. With this effort, the company has doubled its innovation rate. The authors also tout Boeing, which turned to a global partner network to design its groundbreaking 787 Dreamliner aircraft.
But what works for one organization or project might not work for another. Sawhney and Nambisan stress the importance of analysing both the “innovation space”—the knowledge base or technologies the company hopes to exploit—and the sort of “network leadership” the company plans to employ.
Based on where firms are on those scales, the authors prescribe one of four models: the Creative Bazaar, the Orchestra,the Jam Central and the Mod Station.
P&G, for example, employs the Creative Bazaar. The company shops for new ideas, products and technologies at a global market of its own creation. Boeing, on the other hand, already had a vision of its 787 Dreamliner. In this case, the firm played conductor to an “Orchestra” of customers, suppliers, technical experts and other partners to develop the new aircraft’s components.
The third approach—the Jam Central model—is more improvizational, involving a group of contributors who share the research effort. The Mod Station, meanwhile, invites others to modify an existing product, process or service.
“The point is, one size does not fit all,” Sawhney says. “We define the different methods and models to help firms determine which approach will work best for them.”
The book discusses how managers can lay the groundwork for their organizations to look outside for innovation. Challenges can include developing capabilities and shifting “proprietary” mindsets, and Global Brain suggests how to accomplish both. The authors also detail how to execute and evaluate these network-centric initiatives.
“It’s about innovating smarter and faster in a networked world,” Sawhney says. “How do you embrace openness? How do you drive change? This is a toolkit for getting the innovation advantage and harnessing the global brain.”
The article is based on The Global Brain: Your Roadmap forInnovating Faster and Smarter in a Networked World by Mohanbir Sawhney, the McCormick Tribune professor of technology at the Kellogg School of Management, and Satish Nambisan, professor, Rensselaer Polytechnic Institute. Rebecca Lindell is a staff writer at the School.
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