Gone are the days where R&D and innovation teams were locked away for months, sometimes years, to emerge under a grand spectacle to present the latest, greatest, and newest. Innovation ecosystems in many forms are successfully overtaking the closed-door approach to challenge the linear and dated innovation process, as well as deliver significant value back to an organisation.
Although there is no broad, agreed definition of an innovation ecosystem, we have defined it as a collaborative association of empowered innovators, both within and outside an organisation, driven towards a clear objective to create exponential, new value for all parties involved.
Regardless of the model of ecosystem, there are common benefits that cut across these multiple models. Some of these are unexpected, whereas others can be an anticipated benefit. In selling an innovation ecosystem into your organisation, four key benefits emerge as those drivers of value, both measured in dollar terms, but also in productivity, efficiency and creativity.
- Challenging a Closed Culture – Every company has a ‘way of doing things’, a set of behaviours, even a language of acronyms or industry-specific jargon, that create a specific paradigm of thinking. The innovation ecosystem can challenge that paradigm with an injection of fresh thinking, new frameworks and processes.
- Creation of exponential value – Cisco’s CHILL innovations have driven an additional $4.5 billion in additional revenue, and through 5 ideas that are targeted to be commericalised, have the potential to generate another $6 billion. This step-change injection of value is nothing to be sneezed at, particularly as it is not focused on incremental value.
- Driving Creativity through Connections – Often industries operate in their own vacuum, examining the landscape through the filter of competitors in their own category. The relationships that are triggered through innovation ecosystems that open up the industry doorway begin to foster collaborations that would have been previously difficult to create within the silo of their own organisation or industry.
- Innovation on the Edge – Financial services have been successful at tapping into this concept by nurturing engagement with the start-up community, often with premises physically separate from the head office. The premise is to have the ecosystem operate on the periphery of the business, unhampered by internal processes, systems, and thinking. Westpac’s Reinventure has successfully partnered with Blue Chili in Sydney to not only disrupt financial services, but to take an industry approach and provide fintech solutions for industries such as healthcare.
Embracing innovation ecosystems and their benefits is not the magic elixir for driving new value, but needs to become a necessary mandate as part of an innovation strategy for any organisation to grow. With landscapes changing at breakneck speed driven by technology, global access to distribution and communication channels, and new platforms emerging almost daily to challenge the status quo, staying even just one step ahead may give your organisation that competitive edge.