Open Innovation Intermediaries, Service Providers and Platform Developers
Philip Sorensen of Advanced Technology Innovations recently asked me some good questions on the role of intermediaries and platform and service providers within the open innovation ecosystem.
His questions went like this:
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I recently came across inno-360. Do you think more companies are going to be trying, like PG and GM, to use such companies to bring their own OI ecosystems in-house? Does this represent a threat to InnoCentive, NineSigma, and other partners? Or is it just an additive thing, i.e., one more tool for them to use?
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For your information, inno-360 is a software company that helps companies built their own platforms for working with external collaborators.
This was my reply to Philip:
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Hi Philip,
I definitely believe that larger companies will develop their own internal systems to handle the many issues related to open innovation (projects, relationships, IPR and more).
I do not think this will hurt NineSigma and InnoCentive that much. They offer consulting-like services that the big companies will still need and they also offer access to external sources that corporations do not have and will have some difficulties building themselves.
The more focus we get on open innovation, the more the leading service providers will benefit.
Stefan
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What do you think? Are large companies moving towards building their own internal services using the software and services of providers such as inno-360 and Chaordix on the expense of intermediaries? A combination? Or perhaps something completely different than what is visible today?
I look forward to hearing your thoughts.
I agree there is not a one size fits all in the open innovation area. Corporations can not 100% internalise the activity. They will need intermediaries for "effective" OI management. We need more intermediaries. We should not forget that the small company big corporate interface is only the first phase of OI market development. Who is going to assist what I will believe to be the massive growth in SME to SME OI activity? These companies will not have the resources to internalise.
Stefan – you are exactly right: new capabilities that advance the "cause" and cultural adoption of open innovation will certainly not diminish activities for NineSigma and others, but will continue to drive additional need for even more specialized OI expertise (and as they say, a rising tide lifts all boats!!!). This is especially true as companies continue to build their OI functions and expand their internal staff/capabilities and recognize as well which OI functions can be outsourced and done better by firms focused on one aspect (whether it is prize-based challenges, technology monitoring/landscaping, targeted/vetted partner searches, web-based management of needs and the partner ecosystem, etc.). Nick's comment is also dead on – for every Fortune 1000 company with OI needs, there are 100's of SMEs with needs just as urgent as the big guys. Maybe not as many needs per organization, but they will be just as critical to their success and revenue growth.
I also agree that Nick is right on saying that there is no "one size that fits all" in fact, within one organization, we often see the need for multiple crowdsourcing models (and therefore ecosystems) to fit different needs and goals for internal vs external innovation, problem solving vs ideation and so forth. So a company might use Innocentive or NineSigma for a highly technical challenge that their own internal R&D group couldn't crack, but also develop their own in house, and/or external OI ecosystems using a platform such as we provide for other purposes. Keep in mind that the expertise of crowd recruitment, incentives, moderation and so forth is as important as the technology and intermediaries and services providers like ourselves see many many more crowdsourcing initiatives than an internal group would. So we have access to metadata about what incentive work, how crowds can be expected to respond etc that would be hard for an internal group to obtain.