Why seeker firms may use services such as InnoCentive.com to generate new innovative ideas

 Introduction

Modern technology and primarily digital technology have made the world into a much more connected place as it is easier than ever before to make contact with people from anywhere in the world. Some firms have embraced that development while others perhaps have not. For companies who have embraced these changes and wish to embrace these changes in the future, one way of doing this is that of open innovation. 

 

For context, this answer will break down what exactly is meat by the key terms in the above question such as “open innovation” “intermediary “seekers” and finally “solvers”. It will then do on to explain how these terms fit in with modern business with the use of relevant examples. The organising of all this is known as innovation management. 

 

Key Terms

The first key term to examine is that of open innovation. Henry Chesbrough, one of the key thinkers around the topic of Open Innovation describes it as firms look to ideas outside the firm to add their own internal innovation. These ideas come from stakeholders such as suppliers and academic research but more and more from customers through the use of competitions and websites such as InnoCentive.com as mentioned in the question. And that the use of outside resources should not just be used as a last resort but as a legitimate and openly used method of garnering innovative ideas. 

 

An intermediary is a person or organisation that effectively works as a bridging point between two other parties. In many cases they can be seen as a meditator or common link between two parties. For example, a football agent could be seen as an intermediary between a football club and player or a retailer between a wholesaler and an end-customer. But in this case intermediaries refer to places of innovation development, for the solving of complex ideas. It is often firms who bring these problems are these firms or research groups are known as “seekers” as they are seeking new innovative ideas. While those who take on these challenges. 

 

Role of the Intermediary

Open innovate also allows companies to benefit from research even if they are not the ones to come up with the idea. This is where the intermediary finds their role. Intermediaries create a platform that bring seekers and solvers together. Seekers put their ideas up often online, on the platform. They state their problem and seekers who are interested can take on the challenge. The intermediary is simply a platform to bring these two groups together in the same way Air Bnb brings people with spare rooms and people who need rooms together. 

 

 

 

 

Why Seekers use open innovation / Key Players in Innovation Contest

There is a growing number of seekers as firms become more comfortable opening themselves up in a globalised economy. All of these are not specialised in ground-breaking scientific research like Lego and Treadless who specialised in toy making and t-shirt design respectively. But other organisations specialise in helping solve technical and scientific problems such as InnoCentive mentioned above. 

 

Companies realise that not all the best researchers and innovative minds work for them and there is no way getting them all is even possible. Traditionally this would have meant that they could only be as innovative as the people that worked for them. Companies also realise that if they are a highly specialised firm, they make have a lack of diversity in terms of skillsets. Google hire people from many different backgrounds because they know that it may not be a software engineer who solves a software engineering problem but rather an English major or architect. People from different fields of study can bring with them new ideas and new perspectives and this can often facilitate research between different fields. 

 

While solvers benefit to, seekers protect themselves to make sure that they are to benefit. First of all, if they need to be anonymous that can be on a website such as InnoCentive.com. Secondly in the same way if an employee comes up with an innovation during company time and using company equipment then the innovation belongs to the company and not the individual. If for example, Boston Scientific was to take part they would make sure the IP or intellectual property would belong to them and that the innovative individual or group could then take the idea elsewhere. While the firm may be announcing to the world, a way in which they are thinking of innovating, the potential reward of solution is worth the small risk. 

 

Open Innovation can also be a huge money saver as cash prizes are unlikely to be far less than the potential earnings from a potential solution to the problem at question. The open innovation question might also be a cheaper alternative for firms who for a short period of time need extra help with innovating but don’t have the need for the constant of extra innovation. This can be a huge financial saver. As mentioned above solutions might not come from someone in the field of study. Later I will discuss a hypothetical solution where Open Innovation could help against Covid-19. 

 

Why do solvers take part?

While solvers will not receive the entire financial benefit of their innovation, there are still many incentives for them. First of all, as mentioned they won’t get the entire financial reward but they do get often get a cash reward if their idea is accepted and taken on by the firm or organisation. Another factor or reason for doing this is the personal satisfaction of solving a problem. There are plenty of people who enjoy taking on difficult challenges for the potential feeling of accomplishment and such open innovation initiatives are a great opportunity for this. If the situation allows, winners may also be able to put the achievement on their C.V and improve their future career opportunities. 

 

 

 

 

But why use InnoCentive.com in particular?

The true value of intermediaries is not necessarily the fact that they are bringing lots of people together like social media but rather who they are bringing together. As the  InnoCentive.com homepage says, they specialise in facilitating innovation in the fields of “technology, science, business, AI and data”. InnoCentive.com has value because it attracts a lot of highly motivated and educated people to its website. It’s not something one finds by accident like you might see something on social media and between this and the fact many proposals take a long time to prepare, they are as close to a guarantee as possible that possible suggestions from solvers will be of a high standard. For example, since the outbreak of Covid-19 many challenges have been placed on the website looking into ideas around finding technologies to prevent transmission of the virus and the ability to identify early on that there is a pending pandemic. 

 

As mentioned above solutions might not come from someone in the field of study. For example, with the Covid-19 situation perhaps the solution for the transmission problem could not come from a medical person but rather a fashion designer who has found that the clothing material they use to repel rain can also somehow repel infections. In this very hypnotical example, the medical firm would normally have no need for a full-time fashion designer but open innovation has allowed a fashion designer to solve the problem. While this clothes designer example, is farfetched it does illustrate how open innovate can bring skilled expertise to a problem that may not be readily available at a firm.  

 

As mentioned above solutions might not come from someone in the field of study. For example, with the Covid-19 situation perhaps the solution for spotting a future pandemic

 

A hypnotical example of this could be a data scientist working at a broadcasting company could use their free time to spot trends in data that could help spot an incoming pandemic despite the fact he/she has no medical training. But at the same time a medical lab may not have normally have a need for a data scientists and having such a person full time would be a waste of resources. This point does illustrate how open innovate can bring skilled expertise to a problem that may not be readily available at a firm.  

 

Summary

This answer has examined what an intermediary and open innovation are. It also examined the role and motivations of both seekers and solvers for participating in open innovation while focusing on the organisation in question when appropriate.