Business culture is changing. Corporate America is beginning to adopt the practices first pioneered by the I.T. world in the 1990’s. Open source software was one of the first examples of using crowd sourcing as a means to innovate. Today, open innovation and crowd sourcing are proving to be essential for growth across small, medium, large and non-profit companies.
In a world of widely distributed knowledge, firms are beginning to adopt open innovation practices that combine external and internal ideas and paths to market, spreading and sharing the risks and rewards among partners. Yet few are capitalizing on the resources available in-house. Using open innovation to collaborate across multiple areas of your company is the fastest way to engage your best minds.
Building An Innovation Culture
Innovation often requires an element of freedom and a different hierarchy in the workplace. This idea runs counter to traditional corporate culture. Creating a collaborative culture requires open lines of communication throughout an organization. The goal is to make employees more engaged while at work. Giving employees ownership of an idea or process will make them more passionate about the work they’re doing.
Opening the lines of communication within and across an organization can engage employees to attack enterprise issues like logistical challenges, duplication of content and information sharing. The use and implementation of technological solutions to enhance communication within an organization begins a collaborative effort that can lead to a cultural alignment within that organization. By opening communication across your company and putting in place the technology to foster collaboration you’re sending a message to employees. That message is “let’s work together” and in doing so it gets everyone thinking the same way.
To be effective this message needs to be embraced from the top down within a company. Leadership needs to embrace and promote this cultural shift towards collaboration. From a management perspective, the technologies put in place allow executives easier access to the entire employee workforce, the ability to see what is being worked on, what they’re thinking and what they’re doing. This knowledge can help to drive cultural change and growth and can lead to innovation within a company.
Real World Example: Intel Atom
In 2008, Intel introduced the Atom processors. This new microprocessor was designed for the creation of small, low-powered affordable devices known as netbooks. The Atom presented Intel with a logistical challenge. The microprocessor was priced at one fifth the cost of its base products. In order to keep the price low, Intel needed to create a supply chain to deliver billions of parts to market at a much lower cost.
Intel has supply chain experts across all areas of their operation that individually focus on purchasing, logistics and planning. From these experts, they created a cross-functional team to address the challenges of delivering Atom.
After analyzing the current cost structure, the team determined that supply costs would need to be cut approximately 50% in order to deliver Atom profitably. The team then launched a larger group of 40 employees including representatives from design, business unit manufacturing, production, supply chain planning, material and equipment acquisition and customer service to help create the new supply chain.
This internal “crowd sourcing” team designed a completely new logistical model from production, thru the assembly testing process, to customer delivery, that was able to deliver Atom on time and at the target price. Working on a project as complex as this requires constant communication and education so that each member understands how the pieces fit together. People tend to know their individual roles well, but may not understand how what they do affects everyone else. By opening the lines of communication and encouraging cross collaboration, Intel was able to achieve their goals and introduce a product that changed the computing landscape.
Intel offers a perfect example of open innovation at work. By engaging in-house experts, cross educating them on each others expertise and encouraging open communication and cross collaboration, Intel was able to create an entirely new production and delivery system without engaging outside experts.
Are you utilizing your company’s talent effectively? Try introducing open innovation techniques and watch your team take your business to the next level!