Innovation is garnering attention in the business media, but like crop storage in a grainery it has no value until somebody buys it. The companies are numerous that have come up with great ideas only to see somebody else turn them into business breakthroughs. Equally numerous are companies that are best described as arid innovation deserts. At a time in which companies are slashing payrolls and reducing budgets, Vijay Govindarajan, business professor at Dartmouth College, expressed this chilling thought, “If you don’t take the right actions in the recession, you don’t participate in the expansion. There are going to be new winners and new losers.”
The answer for many companies may lie in a budding business theory known as open innovation. This is a business model that encourages firms to use external as well as internal input to develop and launch new products.
William Qualls, a University of Illinois marketing professor, explained, “Companies that lack resources to generate more ideas by instilling new technology or market-based cultures can instead partner with outside organizations, universities or even solicit suggestions from consumers.”
Blockage to innovation in corporate cultures can occur with two attitudes common enough to become clich?s. One is “we tried that once and it didn’t work”. The other is “not invented here”. Also there maybe reluctance to pursue SIS, steal ideas shamelessly, a time-honored practice.
A study conducted by the University of Illinois that will appear in the Journal or Product Innovation Management found that groundbreaking ideas spring most from companies that stress technology, rather than customer needs or staying ahead of competitors. Firms that focus on their competitors or customers generate more new product suggestions than technology-based companies, but the ideas typically net only subtle advances.
If you think it will be easy to fill what has been described as a “technology gap” in the U.S. economy consider what Judy Estrin wrote in her book on the subject, “Sustainable innovation will require sweeping changes at all levels of society-from the schoolroom and the playground, to the boardroom and executive suites, to the hallways of our nation’s Capitol.”