How Open Innovation Unlocks Commercial Value
Looking outside for innovation is not a new discipline. Successful businesses have always integrated new technology into their product and service offerings over time to stay competitive.
What is changing is the types of partnerships that create most value. We're seeing a shift from partnerships between homogeneous organisations (those who look the same) to "unlikely" partnerships: Corporates from entirely different sectors start working together on common challenges, and corporate-startup collaborations emerge as a channel for commercialising technology faster. The diversity in knowledge, technology, business models, and culture brings new perspectives. It also brings most people out of their comfort zone.
Nonetheless, there is tangible business value unlocked by unlikely partnerships, especially between corporates and startups. Let's dive into the most significant impact areas.
Corporate-startup collaboration and commercially-oriented open innovation achieve positive results within:
Customer retention Higher retention of existing customers through improved and tailored offerings and innovative services. It also changes the customer conversation.
Share of wallet New and improved products and services delivered to existing customers leading to a higher share of wallet.
New wins Win new customers based on unique value propositions and differentiation on sustainability, innovation, and digitalisation.
New service introductions Expand the range of service concepts in adjacent areas, beyond current core services. Unlock new value.
Solving both short- and long-term challenges by connecting and collaborating in a broader ecosystem of technology startups can positively impact:
Better decisions Improve decision-making along your stage gates based on evidence from pilots and collaboration projects shortens time to market.
CVC returns Get financial returns from CVC investments in next-generation services or by introducing a revenue share model with technology scale-ups.
Lower cost of innovation Sourcing the best possible proven technology solutions increases the chance and speed of successful innovation projects. De-risk your efforts.
Efficiency gains in current operations Generate better margins by delivering innovations and energy savings, and improve service delivery and internal processes.
BRAND AND POSITIONING
Beyond growth and profitability, working closely with innovators from the outside to create value for your customers creates awareness and gives you great stories to tell:
Brand value boost As an innovation leader in your industry, the market will expect more growth with a positive impact on your share price.
Employer branding Stronger market reputation as innovation will boost talent attraction and retention.
Marketing and communication effects New services, new deals, new ways of working will impact market share and a stronger position in the market.
High-value services A combination of improved performance, and introducing high-margin services to customers, will lead to improved positioning.
Last, but not least, open innovation and corporate-startup collaboration has effects on your corporate culture. You have access to a new way of developing your organisation and your people by involving them in innovation programs that are motivating, inspiring, and purposeful. In turn, that leads to faster learning and better ways of applying new knowledge.
If only a few of the above points materialise for your organisation by embracing the ecosystem and building future business based on an open approach, the business case is already positive.
• Thanks for your interest.
Photo by Charles Deluvio on Unsplash