Most executives would agree that continuous innovation is a competitive necessity for their organizations. At the same time, evidence is growing that innovation processes in many industries are not yielding the benefits they should.1 As a result, companies are increasingly looking beyond their boundaries for help with innovation, working with customers, research companies, business partners and universities.2
In a study we conducted, the amount of innovation coming from external sources was estimated to be, on average, 45% of the total for the companies concerned. For some retail companies that figure was as high as 90%, while for discovery-intensive pharmaceutical and chemical organizations it was 30% —still a significant number. Half the executives we interviewed asserted that the percentage of innovation from external sources would grow over the next three years; not one said it would decline. (See “About the Research.”)
The need to innovate with outsiders has led companies to tap various external sources, from user communities to competitors. That explains why Aker Kvaerner, a company that specializes in oil and gas recovery technology, is collaborating with engineering company ABB Ltd. to develop an undersea oil recovery process. Their customers, major oil companies, realized that no company could solve this problem alone, and persuaded them to work together.3
Given the availability of new types of... To read the complete article, login or sign-up using the form below.
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