The traditional model of innovation - where companies single-handedly finance, invent, and commercialize their innovations - is no longer the only model. Increasingly it co-exists with a dramatically different approach where a global ecosystem of companies harnesses the creativity of inventors from many different organizations - even from their competitors. In fact, forward-thinking companies already are using this collaborative model to stimulate innovation and revenue growth. That's what 30 Chief Technology Officers heard during a recent IBM-sponsored conference on collaborative innovation. This live event is now available for online viewing by special arrangement with IBM and WatchIT - a leader in on-demand education.
"There is a fundamental change taking place in terms of how corporations create value and arguably, in terms of the core architecture of the corporation," said Don Tapscott, author and strategy consultant. "I think it's the biggest change in a century in the ways that companies build relationships and interact with other entities, institutions in the economy and in society and arguably, the nature of the corporation itself." Tapscott presented his vision of the future as he explained how pervasive computing, the explosion in bandwidth, the adoption of communication standards, and the rise of Web services are enabling people to be connected like never before. Tapscott's remarks are based on a $4.2 million research project sponsored by IBM and 22 other companies.
Moderator Navi Radjou, Vice President, Forrester Research, opened the conference by explaining how collaborative innovation and innovation networks are helping companies to serve markets beyond national borders and source ideas among business partners. Radjou presented several case studies to illustrate the trend. For example, he explained how a highly inventive consumer packaged goods (CPG) company with thousands of scientists and patents became an innovative company by working collaboratively with new partners and long-time competitors. With a major pharmaceutical company, the CPG company created a new healthcare line of business. With a long-time competitor, it created new packaging products.
Against this backdrop, Dr. Irving Wladawsky-Berger, IBM Vice President, Technical Strategy and Innovation, described how people are discovering the incredible things they can do in the marketplace as technology advances, and standards and new distribution models are adopted. However, Wladawsky-Berger warned that today's traditional innovation models are unable to help meet growing innovation demand. According to Wladawsky-Berger, "The more ambitious you are, the more you need to be out there working with others and collaborating. Why? Because if you are ambitious, you're tackling problems that, if you try to do them yourself, you may fail. If you work with the best and brightest in universities, in industry, in government, you have a shot at it."
In another presentation, Dr. Paul Horn, Senior Vice President, IBM Research, offered a global technology outlook, explaining how technology trends can be tapped to enhance business innovation and success. Horn offered the following advice to the CTOs: "Collaborative innovation is all about how you can accelerate the R&D process to create new innovations in the marketplace by working with your customers and partners in various alliances."
A leading academic, Erik Brynjolfsson, Professor, MIT Sloan School of Management and Director, MIT Center for eBusiness, discussed research which shows that more IT-intensive firms are more productive. Brynjolfsson summarized new research: "Where does productivity growth come from? Innovation, and in particular it comes from working smarter, not using more and more. You have to develop partnerships with companies."
Dr. John Kelly III, IBM Senior Vice President, Technology and Intellectual Property, explained how IBM is working to strike a balance between proprietary innovation and open, standards-based innovation. While Kelly asserted that proprietary innovation will continue to have the role of differentiating IBM in the marketplace, he also said that the open, or shared model can increase speed to market and have substantial positive effects on the cost of R&D. Kelly summed up his point of view: "The nature of innovation has changed substantially; we are becoming a knowledge-based society. Knowledge is what distinguishes you, and I believe that intellectual property is now the currency or the differentiator and therefore the way we think about it needs to change dramatically."
Finally, Dr. Bernie Meyerson, IBM Fellow, Vice President and Chief Technologist, pointed out that R&D investments are escalating faster than revenues in many markets, forcing companies to create or participate in innovation networks just to survive. According to Meyerson: "If you do not maintain your technology leadership, you will fall by the wayside. Given current economic trends, pooling one's physical and intellectual capital with others has emerged as a fundamental differentiator enabling the innovation required to lead. Such deep partnerships, where you are valued by, and equally value your partners, will increasingly be an integral part of the corporate landscape moving forward."
To learn more about collaborative innovation networks from business, consulting, and academic leaders, visit www.ibm.com/technology/cto_forum.
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Robert Rauch, 516-393-5761
