8% decline in the collaboration among Danish innovative SMEs
Addressing all the facets and dimensions of external collaboration is beyond the scope of this article, which aims mainly to highlight the role of external consultants in innovation projects and to propose practical ways to bring experts on board without resorting to the use of consultants.
Research by the Danish Agency for Science, Technology and Innovation (www.fist.dk) reveals the important fact that when companies collaborate, the likelihood of successful innovation doubles compared to projects conducted without collaboration. When several parties are involved in the collaboration, e.g. customers, suppliers, consultants, the likelihood of success triples. So, why do only 20% of the 9,518 companies studied by Monday Morning attribute value to the role of external consultants as the source of ideas for innovation? These numbers stand in contrast to management consultancies’ self-perceptions of their mastery of innovation.
Only 20% of Danish companies attribute value to external consultants as source of ideas and innovation
If, in spite of these findings, consultants are not perceived as contributing value to companies’ innovation processes, then perhaps their role should be clarified or even redefined. If Danish innovative SMEs are not among the top-performers in Europe in terms of external collaboration, then would a redefined role for external consultants help to overcome this problem: should their role be to bring external experts and explicit expertise to the company rather than introducing companies to potential collaborators and theorem?
Thomas Friedman in his seminal book The World is Flat, changed the way that many executives and the media spoke about doing business in a globalized world, how the ability to bring order to the global complexity is essential for business success and global competitiveness. Pankaj Ghemawat later rebutted Friedman’s views in his Redefining Global Strategy, but the complexity still remains.
”Dealing with complexity is an inefficient and unnecessary waste of time, attention and mental energy. There is never any justification for things being complex when they could be simple”, Edward de Bono
External consultants should have the ability to see, understand, and communicate complexity in simple terms, an attribute that is immensely valuable for the innovation management process, e.g. at the outset to set the innovation horizon. An example of a company with this ability is Firstmove, which was featured in a previous article on InnovationManagement. This company excels at identifying and interpreting firstmovers’ latent behaviours, and communicating these as future trends and market needs.
Outside consultants are not on their own the key to tripling project success. Collaboration must be diversified and must transcend the stakeholders involved, i.e. customers, suppliers, experts, etc.. Expert advice often comes with a hefty price tag and the amount and composition may need to be tailored, especially if concentrated in one or few persons. Throughout the innovation management process, questions arise and problems require resolution, and often are multidimensional, not necessarily adhering to the formal boundaries defined by professions.
The platform MillionBrains (www.millionbrains.com) is a new breed of social media platforms, aimed at solving business related problems. It is based on a hybrid theory of ‘swarming’ intelligence (Gloor, 2006) and open innovation (Chesbrough, 2006). MillionBrains brings together experts from many fields, who have registered voluntarily to provide expertise and expert comment on problems loaded onto the platform by companies, in the spirit of open innovation. 20% of the current group of experts is from China, the rest being split across the rest of the world. These volunteer experts are motivated primarily by fame and exposure to peers since the monetary rewards are modest. For companies, the rewards from opening up are access to a pool of global talent, speedier innovation and monetary benefit since they pay only for the ‘right’ idea.
MillionBrains is not the only platform offering this type of service (e.g. InnoCentive), and as more companies recognize its value and begin to incorporate these ‘talent pools’ into their innovation management processes, it is hoped that the slow growers among the innovation leaders will increase their performance. This potentially could reverse the downward slope of Denmark’s innovation performance growth.
What is your opinion? If business is global but e.g. taxation is local, does it make sense to measure and compare countries on the basis of the innovation taking place within the country’s borders?
By Frode Lundsten, MBA, Editor for Denmark