Open Innovation Generates Great Ideas, So Why Aren’t Companies Adopting Them?
Today, many companies see open innovation — a process for sharing knowledge and ideas with other organizations — as a core part of their strategy for developing new offerings. Examples include L’Oréal working with Renault on an electric “spa” concept car and auto-parts makers Delphi and Mobileye joining forces to produce an autonomous driving system. Many companies have found that such partnerships generate cost savings and creative insights.
Oddly, however, although both the depth and breadth of intercompany collaboration continues to increase, the actual adoption of the ideas developed this way does not seem to be rising at the same pace. In a recent poll by Accenture, more than 50% of the surveyed corporations said that these partnerships don’t seem to be yielding as many new products or other benefits as they had hoped. Similar to earlier studies, our research suggests the reasons more ideas from open innovation aren’t being adopted are political and cultural, not technical. Multiple gatekeepers, skepticism regarding anything “not invented here,” and turf wars all hold back adoption.
But it doesn’t have to be this way. Independent design agencies, whose survival depends ultimately on their clients’ using their ideas, have long faced this same challenge. They have developed a variety of techniques to encourage clients to adopt their concepts.
To learn about their techniques that other kinds of business might apply, we examined seven cases where seven design agencies engaged in various innovative projects with organizations from sectors that they wouldn’t normally work with, including a hospital, an industrial flooring manufacturer, a government agency, and a public transport operator. We compared ideas that were adopted to those that ran aground and were not implemented by the organization. The resulting insights were confirmed and enriched by an additional set of interviews with executives at 16 other design agencies.
Most of what we saw and heard supported our hypothesis that designers have developed political strategies to overcome the reflexive bias most organizations have against outsiders’ ideas. We learned that, in addition to having good ideas, those agencies whose concepts were successfully implemented had a more flexible approach to all stages of the development process than the average agency. We concluded that this isn’t coincidental: Over time, the most successful design agencies have learned how to create an atmosphere of flexibility from the beginning and sustain it throughout the entire project.
Successful designers took five strategic actions to cultivate flexibility and trust. Some of these strategies might sound as if they have been lifted from the agile or lean development playbooks, but they are being used with a different end in mind: not to drive efficiency but to create consensus.
Create a multi-layered network. Designers at the successful agencies created a large, dense network of contacts with people at all levels of the client organization instead of working with a single point of contact. “You always have topics emerging in such an innovation process that your direct contact cannot face alone. The more people you have on board, the higher the chance that through discussing different perspectives, they can get to a solution,” one designer explained. A large, dense network helps reduce silo thinking, increasing the odds of creating a more holistic and robust design concept. It also lowers the risk to the agency that the work will be disrupted should a key contact be reassigned or leave the client company.
Foster equal ownership. As the first tip implies, a second part of building flexibility into the idea-implementation process is to make sure that all stakeholders involved feel equal ownership of and responsibility for the idea. As an innovator, you want to prevent such questions as: What do you know about our business? Who do you think you are? This kind of negativity can crush the chance of any new idea to win acceptance. One designer told us that when such questions are asked, you “have to pull so much harder in order to sell yourself…to create support within the organization.”
One way successful designers encourage a sense of ownership is by highlighting the different benefits that each stakeholder may gain by participating in the innovation process. They try to acknowledge even the smallest contributions anyone made to the creation of the idea.
They also try to keep communication open: One designer told us that they use messaging systems (e.g., Slack) to facilitate discussions about ideas. Designers started group chats and invited company representatives to join those chats. This allowed everyone to follow and join the discussion of the idea and to monitor its progress.
By asking specific questions where detailed knowledge was required, the designers encouraged representatives of the company to feel that they were more involved in the process, giving them a sense of ownership of the idea as it emerged. Moreover, shared responsibility decreases dependency on a single group of decision makers. As we noted above in citing the advantages of building a multi-layered network, shared responsibility means that the idea won’t automatically die even if the leadership in the client organization is reshuffled.
Establish interim milestones. Politically savvy designers also tried to structure projects with interim milestones — adding more steps throughout the process either based on their gut instincts or with the help of project-management methods such as scrum, kaban, and the like. Such “staging” of the innovation process increases the transparency, reduces the perceived complexity, and makes the project seem less intimidating to all the parties involved.
Interim milestones make it easier for the designer to build support for the project bit by bit over time. Chopping the otherwise unpredictable innovation process into smaller parts while also giving customers and other stakeholders the chance to offer continuous input and feedback clarifies the project’s terms and goals. As a managing director of a design agency told us:
“In the beginning of a big collaborative project, everyone has very wild ideas, but nobody can pinpoint what exactly we would make, how much that would cost — things that in the traditional development context you would put nicely in a row, using the waterfall approach and make a very complicated budget estimate, and then hope that it will all end well. But in many creative/innovation projects, you don’t know in the beginning where you are heading… You can go on a discovery trip together with the client and take small steps within given timeframes.”
Such a “discovery trip” lowers the risk for both partners at each stage — not only because they’re sharing the risks but also because they have more time to build trust in each other. This reservoir of trust is often useful during implementation, which is when many projects begin to face more internal resistance and other hurdles. It also generates more buy-in from representatives of the organization because it allows them to actively shape the development of the idea while it is still at an early stage.
Build an open business case. We also noticed that designers raised their odds of a successful implementation when they left an initial concept more open and allowed it to be shaped during the development process by the various stakeholders in the organization. One example is a project with a public transport operator. The initial design briefing led the team to focus more on improving the comfort and safety for people boarding a train in one of the stations that was being reconstructed. The immediate focus on solving this narrow problem led to a dead end, as the involved stakeholders questioned the urgency of the proposed solution and related investments. But reopening the business case and involving other stakeholders led the designers to understand that they were tackling the wrong problem. As a result, they shifted their focus instead to increasing the efficiency of customer boarding in not only one but all stations.
While the core of the designers’ idea remained the same, this open approach kept the entire enterprise sold on the project and improved the idea. Having to articulate the different advantages of a concept to the variety of parties involved led designers to consider its impact from different perspectives and weed out potential inconsistencies. Finally, their flexibility had a political advantage: Reducing their dependency on the sponsorship of a single function meant that, when priorities in one department changed, the idea could still be implemented because it satisfied the needs of another department.
Prototype early. Designers of successfully implemented projects all tried to present something tangible or visual as soon as possible. One team leader insisted: “You have to present tangible examples. Prototyping… shows that you have [everything] in order; that you know the outcomes that you want to achieve.” Creating a minimum viable product not only helps to shorten development cycles; it also helps to convince stakeholders of an idea’s value — especially those who are not involved in the process from the very beginning or those with whom the designer has little direct contact. Seeing something concrete also helps people more easily articulate their concerns and give more constructive feedback while an idea is still at a fluid stage.
Creating flexibility during implementation leads to more support and buy-in for an idea. Ideas that incorporate the diverse views of different experts and stakeholders are stronger. This might seem like signing up for an extra obstacle, but additional iterations mean that executives and other stakeholders are likely to be more convinced of an idea’s merits. Working together in the five ways we have described raises the odds that an idea will be put into practice and not wither and die.