Competitive Intelligence to drive Open Innovation Strategy
I’m fully immersed in my Ph.D. dissertation on Open Innovation Networks , but during the research on Open Innovation (OI) concepts and its emergent approaches, I’ve found there are clearly some key issues that remain quite “out of the sight”. One of them is the correlation between the adequate Competitive Intelligence performance and the potential of Open Innovation approach of the organization.
Smart organizations do not wait for change to happen but actively monitor and take advantage of changing environments and new innovations. The assumption underlying this statement is that “companies that don’t innovate, die” and that the “pursuit of Competitive Advantage, reached by Competitive Intelligence, means Innovation”, if it´s Open, than better.
I believe that Competitive Intelligence provides a critical enabler of Open Innovation at any organization. It´s almost impossible to select R&D partners, come up with big disruptive ideas or establish OI collaboration without previous tech and market mining.
Open Innovation, defined as valuable ideas that can come from inside or outside the organization and can go to market from inside or outside the organization, clearly depends on Informational input. As it said Chesbrough: “ Many organizations no longer rely solely on their internal employees knowledge to innovate”. OI is predicated on companies taking advantage of external R&D to innovate in their products and services, and, conversely, working proactively to license their own R&D to others. All this requires good information mining in the market and in the competitive/ technological environment.
More and more companies are turning to external knowledge, through various forms of collective intelligence methods, to solve complex problems. There is an explosion of crowdsourcing initiatives, a boom of ideagoras and a proliferation of communities of practice. So all that means the enterprise had previously considered the state of art required to innovate in its sector or to disrupt the technology , but is it really means that all organizations with OI strategy do Competitive Intelligence correctly?
Technological information contents normally are associated with a specific innovation strategy. One recent model that supports a proven effective innovation strategy is the Open Innovation Model (developed by Chesbrough in 2003). It proposes to bring innovation from external cognitive sources, beside the internal ones. Open Innovation model, by the logic of its process, works well if it is associated to a competitive intelligence system.
Open Innovation models advocating incorporation of innovation from external sources depend on technological and competitive information as a critical element to mobilize innovation. That models do not discuss key specification of the information architecture, such as, planning of the prospective, criteria to select required information, or even performance appraisal systems to ensure proper assessment of innovation. They just assume that Competitive Intelligence takes place and that it´s executed in a right way.
Open Innovation demands fast, effective competitive technical intelligence. Right …and it means:
- Open Innovation model is moving Competitive Intelligence from a niche to a mainstream position in corporate life, so Competitive Intelligence results must be effectively conveyed to a broader user base. Its mean that Competitive Intelligence not only helps the organization to open itself to the market but also it provoques higher level of internal democracy. Competitive Intelligence allows companies to create new knowledge- inducing more flexibility and the collaborative decision making-, if they can learn to align their Competitive Intelligence process with strategic intent and with collective representation.
- Complete Competitive Intelligence needs to draw upon multiple information resources. It can help develop the contacts and capacities to help identify bold opportunities and to locate the right partners to bring them to fruition, but onli if it has an integrative and multidisciplinary approach.
- Competitive Intelligence must be woven into business decision processes. It considers that the strategic dimension of competitive intelligence process resides in the triad; collection (of information) – interpretation/analysis (of information)- action. Therefore the role of Competitive Intelligence is to create knowledge from information.
- Competitive Intelligence analysis must be expedited. The great amount of data or information is useless without putting it into circulation. Internal and external.
In a recent article ”Industry Collaboration: A new era of open innovation”, the authors state some principal lines how technology intelligence (even more, the Intellectual Property prospective) can be linked to open innovation in practice and how companies such as P&G or Nokia make it real. But even so, there are still many blank spots.
Practicing Competitive Intelligence doesn´t guarantee neither a success, nor an adequate OI strategy. But it improves your chances. And in highly competitive and complex markets, it´s a bargain.
Competitive Intelligence has been defined here as “the capture and delivery of competitive information as part of the process whereby an organization develops an awareness of technological or market threats and opportunities”