The past success of the Closed Innovation paradigm accounts for its persistence in the face of the changing landscape of knowledge. It is an approach that is fundamentally inwardly focused, which fit well with the knowledge environment of the early twentieth century.  However, the paradigm is increasingly at odds with the knowledge landscape at the twenty-first century.

The people who were trained as scientists in this period were mastering the tremendous intellectual breakthroughs in understanding the physical world, but were largely uninterested in applying those insights to practical problems.  Although the knowledge being created within universities seemed to hold great promise, your growing enterprise could not rely on this knowledge being put to use in your industry on its own.

The universities are full of professors with deep expertise.  Better yet, these professors are surrounded by graduate students, who apprentice themselves to these professors and their graduate students are clearly eager to apply that science to business problems.  The future research agendas of faculty members are coming to reflect important problems being confront in industry.  In the world of the Internet, leading scholars from around the world contribute new papers to online archive, creating a global community of scholars.

The logic underlying the innovation process is now completely reversed.  Even the expression not invented here (NIH) has an entirely different meaning.  Today NIH means that companies need not reinvent the wheel, since they can rely on external sources to do the job effectively.  The new logic turns the old assumptions of their head.  Instead of making money by hoarding technology for your own use, you make money by leveraging multiple paths to market for your technology.  Instead of restricting the research function exclusively to inventing new knowledge, good research practice also includes accessing and integrating external knowledge.  Instead of managing intellectual property (IP) as a way to exclude anyone else from using your technology, you manage IP advance your own business model and to profit from your rivals’ use.  You might even occasionally help fund a young start-up to explore an area of potential future interest.

Inserts based on Open Innovation by Henry Chesbrough.

Webster defines a channel as “a way, course, or direction of thought or direction of thought or action.”  These channels will be courses of action leading to innovation.  Much like distribution channels give producers a choice of how their product is distributed, innovation channels are the choices by which innovation skills are accessed, and apply to both internal efforts as well as external ones.  As the whole notion of open innovation has flourished, there have been few attempts to provide practitioners with a concrete set of guidelines for how and when to select an innovation channel.

Insight on innovation channels is explored by Alpheus Bingham and Dwayne Spradlin in their book The Open Innovation Marketplace: Creating Value in the Challenge Driven Enterprise.  This insert will provide you with sources for establishing a foundation on the channels themselves and their distinctions:

1. Internal – Innovating using the existing resources, namely people and equipment, within an organization.
2. Contract Research Organization – A well-defined range of specialties and capabilities.  In many instances, they repeat a given type of research more frequently than a product innovator does.  This gives them a competitive edge for conducting certain studies.
3. Electronic Request for Proposals – A contracting group can access organizations they may be unaware of and expand the range of alternatives prior to selection and agreement of terms.
4. Off-Shoring – Differently from outsourcing, this channel refers to the placement of the work in countries where labor costs are significantly lower.
5. Crowdsourcing, Ideation – The broadcasting of challenges to a wide audience but with the expectation that the solving audience would respond with only their ideas or a theoretical justification for why their approach should work.
6. Crowdsourcing/Reduction to Practice – The solving community will also conduct the studies required for “reduction to practice.” The solving community members to whom the challenge is broadcast are expected to conduct appropriate experiments and demonstrate the viability of their solutions.
7. University Contracts – Often conducted as part of graduate student thesis efforts, with special IP and publication issues, and more important, the efforts themselves provide affiliation with some of the most respected and trustworthy brands in the world.
8. Consulting – A self-explanatory internal innovation.
9. Right of First Refusal – A unique way to manage risk by paying for “fewer” rights upfront in exchange for the right to negotiate for greater IP, at a later date, after risks have been reduced by experimental outcomes.
10. Joint Venture – When entities, which usually do not compete with each other, may both benefit from the outcomes of an innovation endeavor and want to share risks, costs, and of course, financially attractive outcomes.

Software innovation is made more manageable and less expensive in an open source environment. The point of open source is to offer software which is cheaper, dependable, and of superior quality. This software is often free and available for anyone’s use.

The Benefit
In an open source environment, all may benefit from the program a programmer creates or improves. Programmers are also given the ability to work on several projects at once. The open source community can be a great entry in the venture capital world and widen the possibility landing a super OS job. Many of these nuances keep the open source boat afloat.

Sustainability is a shared responsibility in an open source setting. A programmer is no long solely responsible for the maintaining their innovations, but others can contribute through shared codes. This frees them up to crank out more innovations. An open source environment is an amazing starting point for innovators.

Now the preverbal need to re-create the core is eliminated. Open sources makes innovation easier. An additional benefit is the innovators ability to work alongside other innovators and his or her varying vantage point and worldwide view.

Innovation is global, multidisciplinary and open; therefore the need to bring different minds and different perspectives together to discover new solutions to long-standing problems is immense. Therein lies the essence of collaborative innovation.

In the words of Thomas Goetz:

Software is just the beginning … open source is doing for mass innovation what the assembly line did for mass production. Get ready for the era when collaboration replaces the corporation.

The Power
So what makes open source so powerful?

Goetz gives two reasons: the rise of the Internet and the excesses of intellectual property. The Internet is open source’s great enabler, the communications tool that makes massive decentralized projects possible. Intellectual property, on the other hand, is open source’s nemesis: a legal regime that has become so stifling and restrictive that thousands of free-thinking programmers, scientists, designers, engineers, and scholars are desperate to find new ways to create.

Freed from the need to re-invent the core, they are able to devise the new more easily, of course. But just as they are no longer responsible for all 100% of the sustaining, they are also able to work alongside other innovators and to benefit from their differing view of the world, bringing new richness.

The Myth
The notions that open source is not innovative and only a means to avoid license costs are now busted. A software innovation trail is being swiftly blazed by the open source revolution. Industry leaders such as Apple and Microsoft are using it build the world.

http://thedecisiontree.com/blog/thomas-goetz/

http://www.wired.com/wired/archive/11.11/opensource_pr.html

http://startupowl.com/resources/startup-boosters/open-preneurs/

These days, the former leading industrial enterprises are finding remarkably strong competition from many newer companies.  Companies such as Intel, Microsoft, and Cisco conduct little or no basic research on their own.  Although they have been very innovative, these companies have innovated with the research discoveries of others.  And there is a legion of other, even newer companies waiting to supplant these firms if an opportunity should arise.  They are likely to rely on someone else’s discoveries to ascend to leadership.

What accounts for the apparent decline in the innovation capabilities of so many leading companies, at a time when so many promising ideas abound?  Closed innovation.  It is a view that says successful innovation requires control.  In closed innovation, a company must hire the best and the brightest people, so that the smartest people in their industry work for them.  In order to bring new products and services to the market, they must be discovered and developed from within.  If they discover it, they will get it to market first and, thus, declared the winner.  If the lead the industry in making investments in R&D, they will discover the best and the most ideas and will come to lead the market.  Therefore, they should control their intellectual property so that their competitors don’t  profit from their ideas.

Today, several factors combine to erode the underpinnings of Closed Innovation.  One factor is the growing mobility of highly experienced and skilled people.  The logic of Closed Innovation was further challenged by the increasingly fast time to market for many products and services, making the shelf life of a particular technology ever shorter.  When these erosion factors have impacted an industry, these assumptions and logic that once made Closed Innovation an effective approach no longer applied.

Open Innovation is emerging in the place of Closed Innovation.  Open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology.  Although the Open innovation process still weeds out false positives (now from external as well as internal sources), it also enables the recovery of false negatives, that is, projects that initially seem almost worthless, but turn out to be surprisingly valuable.

The world of business is constantly growing, changing, adapting and modifying. Innovative business leaders understand that constantly hanging on to the past leaves no room for the new future – future that will build your businesses and your life. The future is new and exciting, providing you with the opportunity to work with new people and serve a different consumer for a greater cause. Innovation should be a part of your business foundation as a key success factor. If you don’t evolve and constantly re-create your ideas, your business will die.

Running a thriving business is like swimming in a shark tank where survival is a daily achievement.  There are keys to continued existence.  Innovation is an integral element.  Many business trend analysts confer the notion that innovation can really save a dying company.

Innovative for the People and a Purpose

Innovation should keep a company fresh and progressive while also generating cash flow.  If not, shareholders will not be happy.  However, the purpose of innovation goes beyond making money. It must be customer-centric.  The product of good innovation answers the needs of the customers, and communicates that the CEO is listening and is dedicated to their satisfaction.

Examine the world, your organization and your partnerships, your competitors and your operating environment. Be aware of opportunities, trends and emerging markets. If you don’t see a solution, create one.

Choose to Live

Never switch off, keep your business antennae alert…. And, yes, it does require energy. If you are already thinking you don’t have the energy or the time then that tells me you are one of the blinkered rather than one of the brave.  When energy and time are not an issue, it becomes a question of choice. It is choice not chance which determines our destiny.

An Apple a Day

Apple is a great example of how a company strives and succeeds by constantly executing innovative ideas.  Some say Steve Jobs turned Apple around purely with innovation.  He also possessed the guts and vision to push his ideas forward. The question is can your company be innovative like Apple.   The article You Can’t Innovate Like Apple shares:

The vast majority of executives who say, “I want to be just like Apple,” have no idea what it really takes to achieve that level of success. To succeed at innovation as Apple has, you need a leader who prioritizes new product innovation.

Nokia and Samsung are additional notable organizations in advancing innovation.  Companies like Yahoo and Microsoft are on the grind to stay in the rat race with their big brothers in business.

Efficiency: Designed to Achieve Survival

The epic conflict between efficiency and innovation as a story told by The Innovation Bound Blog:

The story of a business typically begins with some differentiation, something different about that organization that yields a competitive advantage. Maybe it’s a new method of production, new product, secret recipe, or a new combination of many things. The competitive advantage is born from creative thinking. The business manages to get a foot hold in the market, because of the new value it can offer customers.

The story continues. Positioned for growth, the company begins to change. It leaves behind its dreamer and strives for streamlines, efficiency and scalability. It hires John Sculley, who fires Steve Jobs. And the company grows. It grows massive, captures huge portions of market share. Fat and happy it seeks to maintain its place. It hires lawyers and lobbyists to help prevent trouble from the law, hires marketers to keep the consumers wanting more, and managers to keep the labor in line. And then something happens. Growth slows, perhaps even halts. The company scrabbles to figure out why. Did the consumer change? Did the competition change? What happened?

The truth is that the environment, consumers, and competitors are all changing ever faster. Some companies dwindle here. They layoff employees and sell off divisions in an effort to get lean and mean again. But some lucky firms rediscover creativity. It was always there, the company was born from an idea. Some companies find their dreamer again; they get Steve Jobs back. They take risks again, make mistakes, open their minds and learn from experimentation. And, because these firms know efficiency and creativity, they can innovate like no other. It is imperative that our companies know creativity. Survival is hinged on it.

Innovate or die!

http://www.pragmaticmarketing.com/publications/magazine/6/4/you_cant_innovate_like_apple

http://small-business-resources-cafe.blogspot.com/2011/09/strategic-agility-for-small-business.html

http://blog.innovationbound.com/post/12269887924/the-story-of-a-business-typically-begins-with-some

G’day!

In a radical move to help society benefit from University research, UNSW has recently decided to make valuable technologies available to business and innovation partners FOR FREE – an approach called “Easy Access IP” –  read more.

Our goal is to let the world know about our technologies, researchers and laboratories so that value can be created through strong business partnerships. This is why we were excited to partner with the iBridge Network^TM. The iBridge Network^TM is a simple, convenient, way for organisations to find new technologies for the benefit of their business – EasyAccess IP community.

The University of New South Wales (UNSW) in Sydney, “down-under” is also seeking Open Innovation partners to help develop breakthrough technologies. As a partner you’ll also have direct access to over 5000 researchers, access to breakthrough technologies and access to world-class laboratories. UNSW is one of Australia’s leading research and teaching universities, ranked in the top 50 universities worldwide.

So now when you think of Australia, “down-under”, we hope you will consider partnering with UNSW.

Cheers,

Steve

Dr Steve Brodie is the Open Innovation Manager with NewSouth Innovations (NSi) the Technology Transfer Company of UNSW. s.brodie@nsinnovations.com.au – www.nsinnovations.com.au

Need another reason to create transparency and access to innovation? As stated in the Huffington Post article, “…new companies have been disproportionately responsible for many of the breakthrough innovations that characterize modern life today…”

Everyone knows we need access to the innovation taking place within the universities to help grow and create new firms. Firms that can create new jobs. New jobs that can help turn the economy around.

Read the rest of the article and see how you can help startup America!

Will Patent Reform Finally Become Reality?  After years of failed attempts, patent reform is again gaining momentum.  In March, the Senate overwhelmingly passed what is now called “The America Invents Act,” and the House Judiciary Committee approved a revised version of the bill in mid-April.  The full House should consider the measure later this year.

The most significant change to the patent system itself is the move from a “first to invent” to a “first inventor to file” system, putting the U.S. in harmony with most of the rest of the world.  There is a great deal of concern this change will harm start-ups and individual inventors that have do not have the resources to file early in the R&D process.  There have been moves to expand prior user rights, which would allow certain prior inventors to continue to use their inventions without infringement.  Prior user rights are expected to be the source of additional debate, but it remains to be seen whether significant prior user rights will end up in the final bill.

One of the primary stated purposes of the legislation is to decrease the Patent Office backlog of over 700,000 applications and increase the quality the resulting patents.  The key provision addressing this problem would allow the Patent Office to set its own fees and prevent Congress from diverting Patent Office fees to other unrelated programs.  Congress has used Patent Office revenue for other purposes for many years, and as late as April diverted $100 million of Patent Office fees to the Treasury Department’s general fund.

The bill also provides expanded opportunities for third parties to present “prior art” to the patent office during prosecution and challenge patents after issuance in a post grant opposition process akin to what is used in many foreign countries.  The goal is to increase the quality of patents by bringing more relevant prior art to the attention of the examiners and decreasing the cost of challenging a “bad” patent.

Although the bills certainly have opponents, the current Senate and House bills do not contain the types of hot button issues, like limitations on damages, that caused patent reform to stall in past years.  And the differences between the Senate and House bills appear to be reconcilable.  Given that patent reform has bi-partisan Congressional support, as well as the support of the Obama administration, 2011 may be the year it finally happens.

As we enter into 2011 there is still much cynicism and debate about the state of innovation here in the U.S. and abroad. What ingredients are needed to spur it? What geographies will lead the way? What should be government’s involvement? What is the private sector’s role? Will the global economy get back on track? We will fail? Will we succeed? 

However, no matter where your opinion happens to fall on the optimism – pessimism spectrum, it is hard to not feel some glimmer of hope when you consider the amount of great thinking, new cutting-edge products and technologies, and amount of incredible innovations on display in the first two weeks of the year at both the International Consumer Electronics Show (CES) in Las Vegas and the North American International Auto Show (NAIAS) in Detroit.

CES was the venue for 20,000 new product introductions from 2,700 different companies including names such as Motorola, Corning, Cisco, Energizer, Netflix, Xerox, Samsung and Hewlett Packard to name a few. In addition to some really snazzy new technologies and devices, many other topics and issues central to innovation were introduced and discussed including open access, broadband spectrum, wireless video, the need for improved K-12 schooling, changes in tax policy, and a focus on free trade.

One week later in Detroit, thousands of key opinion leaders from the global automotive industry including CEOs and executives from Porsche, Ford, BMW, Volvo and others met for 72 hours and witnessed the worldwide debut of nearly 40 vehicles and also exchanged ideas and strategies that affect global economics.

From our perspective here at the iBridge Network, it is great to see that innovation is alive and leading to tangible outcomes that can (and already are in some instances) boost the economy, create jobs, and make us safer, connected, entertained, educated and informed. It is also promising to see the sheer volume of collaboration, access, resources, and bright thinking taking place and making all of this possible.

While opinions may differ on how all of the pieces should fit together and what role all parties should ultimately play, one thing is clear after 18 days of the New Year : There are a large number of business and government leaders who care about our future and are already focusing on results. Now that is a reason for optimism.  

The iBridge Network also cares very much about the future of innovation and is truly invested in further helping many of these companies, institutions, universities, and entrepreneurs to turn ideas and research into commercialized products. Speaking of a tremendous first few weeks of the year, we have already signed 10 new members, bringing the total number of member organizations to 122. Stay tuned for more news and details on that in the coming weeks.

A Time for Reflection and Looking Forward
 

It’s that time of year again…a time to look back and reflect on all that was accomplished throughout the year, and also a time to look ahead with a renewed sense of passion and excitement at the next 12 months.

For the iBridge Network, 2010 was a year of great success and momentum. We continued to serve as an innovation hub for entrepreneurs, universities, organizations and industry by providing access to the right people, the most appropriate resources and the brightest thinking. We began the year with 3,700+ members and we finished with nearly 5,000 spanning across 119 organizations including four of the top five, seven of the top 10, and 19 of the top 25 research universities in the United States. Since our inception we have talked a lot about putting ideas, access, transparency and outcomes at the forefront of today’s innovation agenda and we are pleased to say that in 2010 we added nearly 4,000 innovations to the site and had nearly 160,000 visitors check out what we were doing.

Additionally, we established working partnerships and collaborations with: Knowledge Sharing Systems (KSS) to interface KSS TechTracS® to the iBridge online community, enabling universities and research institutions to better highlight their intellectual property portfolios; and recipients of the National Institutes of Health (NIH) Clinical and Translational Science Awards (CTSA), a consortium of 46 medical research institutions dedicated to enhancing the efficiency and quality of clinical and translational research, to seamlessly join users of CTSA’s CTSA-IP initiative with more than 100 other research institutions around the world.

Furthermore, we also implemented our previously announced relationship with the USA National Innovation Marketplace—which is supported by the US Department of Commerce’s NIST/MEP Network and Eureka! Ranch International—to enable innovation and research listings from non-profit organizations to coexist on our site, allowing for even more exposure and collaboration opportunities for them.

And, what is perhaps our most exciting endeavor of the year, we continued our international expansion! In November 2009 we signed the acclaimed Nanyang Technological University (NTU), Singapore’s leading science and technology university, as our first international member organization. We carried that momentum into 2010 with the addition of Toronto’s University Health Network and the Norwegian University of Science and Technology.  

Of course, none of this would be possible without the unwavering support and participation of all of our member organizations as well as the commitment of our passionate employees and advisors. We want to thank everyone involved in making 2010 a huge success for iBridge and for innovation and we look forward to continuing our efforts and working with all of you in 2011. Happy Holidays!