Since open innovation is an extension of internal innovation – at least it should be – one would expect that companies take managing their innovation networks very serious. Unfortunately, in many organizations this is not the case. Managing open innovation is seen as managing individual partners for individual projects or if lucky, multiple projects. This way open innovation becomes nothing more than simply outsourcing of innovation, using a simple command and control model. Through this attitude, many opportunities will be lost that companies could gain if they would really manage their networks. Managing your network means carefully selecting, engaging, developing, supporting and evaluating your individual partners. But more than that it means stimulating your network by: connecting your partners, searching for synergies and stimulating business opportunities, inviting new high potential partners and consistently promoting the network as a whole to the outside world. Here are some reasons why you should do so:
- Developing your partners will benefit you in the long run: helping your partners better to help you reach your goals
- Partners are interested in doing business with you, but in the end look at the value of the system they are inserted to. If your network offers new business opportunities besides the ones you offer directly, this might be a good reason for partners to stick with you
- Managing your network through partner portfolio management will give you the ability to see what capabilities are missing and which partners are under or over-performing and thereby being able to take actions together with them
- Network members might have conflicting objectives between them. It’s necessary to manage this, avoiding potential problems in projects
- Partners that are more engaged with you, will be less inclined to try to benefit in the short run from your relationship
- Network management means being in control of IP issues, avoiding intentional or unintentional breeches between you and your partners and between partners
- Network management means stimulating practices and knowledge exchange between partners, bringing down the cost of learning.
These are just a few reasons. I am sure you will be able to think of many others. I urge everyone working with open innovation to start looking at your partners as a valuable asset in your innovation process and to learn how to link your network to required competencies, culture and results searched for in innovation by your organization.
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Caspar van Rijnbach is a specialist in innovation management and partner at TerraForum Consulting in Brazil – www.terraforum.com.br and www.terraforum.ca. Co-author of “Innovation: Breaking Paradigms” and “Management 2.0’’ (in Portuguese).
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I liked what you said about connecting your partners for a benefit in a long run. Very Interesting article!
Thank you.