External R&D and IT: Are you ready yet?

Innovation, especially in IT, needs to start taking place more and more outside your company’s walls, and, according to a recent study by IBM, your CEOs are beginning to realize this, so hopefully you’re a step ahead of them. As CIO magazine Editor in Chief Abbie Lundberg notedin her edit letter this month, 75 percent of the 765 CEOs polled said that collaborating and partnering outside the company is critical to innovation.

A report by Forrester Research last year echoed that statement, noting it behooves organizations to set up “innovation networks” to move in this direction, too, and consider a wide range of sources for developing a new idea. Some of these sources included: business partners, customers, consultants, associations/trade shows, academia, and (this one is my favorite!) competitors.

So what are you waiting for?

Well, there are probably a few things to consider, I suppose: mainly that this new type of strategy flies in the face of hundreds of years of top-down, we-protect-what’s-ours, over-our-dead -bodies-would-we-work-with-our -competitors type of management.  Secondly, you might not be ready to give up on internal innovation entirely just yet. And, as much as I adore the principle of external collaboration on paper, there are many questions to consider before you do.

To name a few:

* Is your company truly ready to dust off IP it’s never used or needed but, for a variety of typically overprotective and irrational reasons, you’ve left on the shelf like old paperback books you never intend to read again but keep there as a “look what I did?”

* Is your CEO truly on board with this? It’s one thing for CEOs to be called for a survey and asked if they believe collaboration and partnering is good. What are they going to say? “No, I hate collaboration.” Such a statement would surely raise the eyebrows of any forward thinking business leaders. But actions, as they say, do speak louder than words. So saying they like collaboration outside the enterprise versus actually authorizing it when you ask them if its OK to out a piece of company data for the purposes of external collaboration may be at odds.

* Are you technologically ready? Do you have the collaboration tools necessary to manage innovation coming in from the outside?

* Will you marginalize your job and your IT department by

allowing this to happen? (This, of course, isn’t true, but people in your IT department might feel this way, and you’ll need to be prepared).

At many companies, these questions were vetted long ago and have already been quelled. Some examples (verbatim) from the Forrester Study:

Boeing: Sources two-thirds of the invention and transformation of its new 787 Dreamliner jet from a global network of suppliers. Formed a R&D alliance with IBM to co-invent networkcentricdefense IT solutions.

BT: Positioned brokers in India, China, Japan, UK, and Silicon Valley to source local tech inventions. Licenses IP to external Transformers. Partnered with VC firms to spin off noncore inventions as startups.

BASF: IT organization is making its technical invention and business transformation services

available to other companies.

While this is all very well and good, I’d like to know what your companies have done with external collaboration The aforementioned companies are used often as the poster children for collaboration in business literature, so sometimes I want to pinch myself and make sure this is truly a “trend.” What other pieces of IT innovation can be developed by partnerships?

I’d be happy to hear them….