Archive for June, 2011

Wednesday, June 22nd, 2011

Platform technologies – The secret to Open Innovation © Roger La Salle 2011

Making the simple seem complex

How many who are motivated to build their business on the back of innovation have come across the so called “Open Innovation” model?

It seems quite amazing that such an endeavour could even lay claim to its own title, but then again there are many that revel in making the simple seem complex and representing this old and widespread practice as a breakthrough in thinking with a shiny new label.

Promulgating widespread problems in search of solutions, especially in medicine has been around for centuries and in the case of mathematics and physics, some of the classic problems have been around for 1,000’s of years. This concept is by no means new.

Just to mention a few of the “innovation plays” these days we have at least the following:
• Open innovation
• Closed innovation
• Fast failure innovation
• Front end innovation
• Incremental innovation
• Radical innovation
• Disruptive innovation; and no doubt many more.

In reality, it does not matter what label you put on your innovation endeavours, it’s the outcome that is all important. Let us put this unnecessary labelling to rest and keep it simple. Now there’s an innovation in itself!

Put simply, the word innovation means “change”, and the best definition of innovation is “Change that Adds Value”.

This definition is founded on the simple basis of removing the single biggest risk in business, market risk, and innovation properly done achieves just that.

Enough said!

Open Innovation – The alarm bells are ringing

The idea with open innovation (one that would appear obvious) is that if you don’t have the internal skills to solve a problem then look outside the organisation. That’s Open Innovation, as distinct from “Closed Innovation” which asks you to look inside the organisation.

However, there are some proponents of this open innovation model that suggest that we should tell the world our problems and let people come forth with solutions. This is a concept perhaps more applicable to philanthropy than business. In a business sense how can the IP and ownership issues be managed? One can only ponder!

You can be sure the discoverers of new drugs, such as cures for widespread diseases such as TB, Cancer and the recently reported bio hazard associated with vegetable ingredients in Europe will not be freely forthcoming with solutions, though they revel in the knowledge of the problem.

Drug empires are built on solving these problems.

What many people fail to realise is that it’s the identification of a problem worth solving that is the real “gold”.

Problems are the reciprocal of opportunities

When we see a problem worth solving, keep it in house and only if you do not have the internal skills then by all means look outside, but do it carefully and systematically.

Further, if you find a potential solution provider develop a contracted relationship to work the solution with you in the box seat and you owning any resulting IP.

Where to now for Open Innovation!

Perhaps the best chance for this so called “Open Innovation” is when a business possesses what may best be described as a “platform technology” that is a gateway for millions to develop applications that make use of the platform, with the creator of the platform being locked into the value chain.

The new smart phones are a good example with applications coming on stream at an amazing rate and the phone providers “clipping the ticket” at every turn.

This is a wonderful business model, but is this a new approach?

Is this a new Idea?

Platform technologies are not new, but perhaps were not developed with the platform concept in mind.

The wheel is a platform or foundation technology with an endless variety of uses stemming from its creation. So too were the inventions of the ratchet, the gear box, the internal combustion engine and even the electric motor.

Unlike the new smart phones that have intrinsic value in themselves these old stand alone technologies have none. Stand alone, the wheel, the ratchet, the internal combustion engine and the electric motor have no purpose but are simply building blocks for others to employ in their innovations.

Can I have one?

Many businesses are in fact in possession of “platform technologies” but many fail to realise it and thus have not embraced appropriate opportunity search and capture methodologies to leverage their position.

The starting point is to identify your platform then develop an opportunity search model, the rest will quickly fall in to place.

In short, if you wish to embrace the so called open innovation model do so with great care, but better still, identify a “platform innovation”, own the IP, tell the world and let the market do the rest.

**** END ****

Roger La Salle, is the creator of the “Matrix Thinking”™ technique and is widely sought after as an international speaker on Innovation, Opportunity and business development. He is the author of four books, Director and former CEO of the Innovation Centre of Victoria (INNOVIC) as well as a number of companies both in Australian and overseas. He has been responsible for a number of successful technology start-ups and in 2004 was a regular panellist on the ABC New Inventors TV program. In 2005 he was appointed to the “Chair of Innovation” at “The Queens University” in Belfast. Matrix Thinking is now used in more than 26 countries and licensed to one of the world’s largest consulting firms.

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