In challenging times and shifting markets the natural instinct of many is to focus on what they can control and the attention inevitably turns to rest on the internal and the concrete. However – research published by International Journal of Innovation Management shows that it is a collaborative and open approach that is the most effective way to innovate in turbulent times. The question we ask is, do people have the collaboration skills to build increasingly valuable and difficult to replace, partners and allies?
In their 2011 paper ‘Open Innovation And Its Effectiveness To Embrace Turbulent Environments’, Schweitzer et al conduct a review of related innovation literature and publish their own research into the best kind of innovation methods and processes for fast moving highly challenging industries. In stable markets, where there are relative constant factors and the business has a strong competitive advantage (e.g. unique assets etc.) – it may still be suitable to take a Resource Based Perspective on innovation, focusing efforts on internal capabilities, skills and knowledge. And in fast changing (mainly non-technological markets) it makes sense to concentrate upon Dynamic Capabilities; an ability to move quickly, change processes and seize new opportunities.
However – in Turbulent Markets, which combine both fast changes to the market combined with the challenges of new technology(e.g. telecoms, media, eCommerce etc.) – their research points to open innovation and collaboration as being most crucial. They say; “The ability to search for and find external knowledge and integrate it with internal knowledge in a savvy way is associated with open innovation… this interrelation and closeness to firm external knowledge may be central to fostering and developing successful innovations in shifting markets as it provides vital weak signals for anticipating future change”
Open Innovation therefore requires greater communication, engagement, listening and collaboration with external suppliers, customers, stakeholders and partners. As Morten T Hansen has pointed out, such important collaboration has to be carefully managed and it has to be purposeful. But Schweitzer et al note that in high-tech and fast-moving environments there may not be an alternative to being more open and collaborative. They say; ” Companies that can integrate technical know-how from external experts can choose from a bigger pool of innovative ideas and may solve technical problems faster. Put differently – innovation success should positively relate to supplier integration and integration with research institutions, in environments characterised by technological turbulence”
Partnership & Collaboration Paradoxes
Of course, recognising and wanting to collaborate and having the skills and resources required to do so are two very different things. Whilst this research is an excellent overview of the topic – its focus is on structural, process and economic factors. Our contention is that no matter how good the strategic aim, research and even the fit with a partner or ally – it will be the personal skills and behaviour of the relationship managers that will determine outcome. I once believed that business was all about either process issues or people issues. But in a world where personal and organisational trust, connections with networks, partners and allies becomes so critical, every major business issue becomes, in the end, one of people. As pointed out in my previous blog posts there are substantial Partnership and Collaboration Paradoxes. Research from the likes of Forrester and companies such as General Electric, CISCO and Capgemini constantly show that whilst there is an increasing recognition of the need to collaborate (both internally and externally) – many organisations and executives lack an ability to do it effectively. In their excellent book ‘Team Geek’, Fitzpatrick and Collins-Sussman emphasise the need for smart technical people to be better at working with others – across the organisation and outside of it. This reflects the thoughts of Rosabeth Moss-Kanter and her classic work identifying that strategic relationships were likely to fail due to personal and human issues, rather than technical and commercial ones. Despite the importance of innovation strategy and commercial intent, it’s the soft yet hard to manage, human communications stuff, between individuals involved that determines if a business relationship will deliver the value that it promised.
Sharpening Collaboration Skills
A lack of empathy, constructive communication and an ability to trust the other party are at the heart of poor relationships and partnership breakdown. And it is for these reasons that we developed the CollaborationCafe 1/2 Day Programme to improve the skills of those managing valuable relationships. We focus on improving awareness & conversation, questioning and listening to help strengthen relationships, commercial discussions and shared planning and honest objectives.
Schweitzer et al point out that “Innovation managers who want to open up their innovation process should not strive to maximise the amount of external sources but should invest effort into finding which to integrate. Of course the quality and actual contribution of a source can only be known after contacting it”.
They are right. And to this point we would add – ” And ensuring you build the right personal and organisational relationships – and conversations to maximise the collaborative advantage for both parties”.
Thanks to INTJ for making this report available.
For the full abstract and original research please visit International Journal of Innovation Management.
Original research by Fiona M Schweitzer, Oliver Gassman and Kurt Gaubinger published in IJIM, Vol 15, No 6 (Dec 2011)
- The Death Of Traditional Strategy – And The Rise Of Connected Business (andrewarmour.com)
- Video: Stefan Lindegaard – Innovation Needs Networking & Connecting.. (andrewarmour.com)
- Honesty And Cooperation In Business Relationships (andrewarmour.com)
- Companies Are Scared of Open Innovation – and Other Insights (customerthink.com)
- NEW Book Review – ‘Team Geek’ by Fitzpatrick & Collins-Sussman – O’Reilly Publishing (andrewarmour.com)
- Open-innovation projects turn old R&D wisdom ‘on its head’ (fiercebiotech.com)