Innoversity Blog

Open innovation and diversity

Christopher Meyer, who is the CEO of Monitor Network is interviewed in this BusinessWeek podcast, where he talks about social networks, innovation and none the least diversity!

One quote that I particularly liked from the podcast was when Chris was talking about the increasing interest in open innovation:

"I think that the reason why open Innovation goes so deep can be explained by two things: First, new science has shown how diversity in essential to novelty, which also maps how gene-pools work: if you want a new strain of corn, you can't do that with a single clone of corn; you need lots of kinds of corn! If you want new thoughts, you need lots of kinds of thinkers!"

and Christopher Meyer continues....

"There is a second reason why open innovation is growing so rapidly right now (...), we've been through a period of about five years, in which companies got extremely lean and reduced their investments in the new and the innovative! (...) So now we have ended up with companies which are low on diversity and high on efficiency, and not particularly innovative. So suddenly now, growth is more important, innovation is more important, but how are we going to do it? Well, the fastest and best way is to look outside the walls of the organization, for a diverse set of resources that can help."

And I can only agree with Meyers on this! You should definately check out the podcast, Christopher Meyer really presents some interesting ideas and perspectives!

OPEN DIVERSITY: LINKING THE INSIDE WITH THE OUTSIDE
One of the primary challenges in engaging in open innovation activities however is, that to effectively mobilize and tap into diverse networks on the outside or the organization; you also need a certain degree of diversity on the inside, which unfortunately only very few of the organizations which have set off to introduce different open innovation initiatives are actually aware of.

Social networks tend to be demographically aligned due to network homophily, which basically means that we as individuals tend to seek out and learn from similar others (as opposed to diverse others), which results in most of us building networks of people similar to ourselves. Organizations with a relatively homogenuos workforce, will therefore likely, only have access to a relatively small external network, as most employees will tend to know practically the same people (Lazer & André-Clark, 2000; Granovetter, 1971). This definately makes it more difficult for homogenious organisations to identify and none the least, tap into external ideas, knowledge and resource!

One of the primary promoters of open innovation is the conglomerage P&G, with their "connect & develop strategy", which calls for 50 percent of innovation to come from the outside! And P&G knows and understands the importance of internal diversity, for them to succeed in truly mastering OPEN innovation.

I was privileged enough to actually assist P&G draft what we called their "Global Innoversity Strategy" last year, which linked the effort of building a diverse workforce directly to innovation efforts. Something I had previously been attempting to convince many other organizations of the need for doing, but P&G, to my knowledge, is the very first - and only - organisation which has actually done so! Hopefully, once I am done with my Ph.d., I will be able to convince many more organizations of the need for doing so!

WHAT MONITOR NETWORK DOES
What Monitor Network does is to help organizations gain access to exactly such a diversity of external resources, such as business practitioners, scientist, politicians etc, to make use of this external diversity of knowledge and competences in their actual innovation practice! Monitor Network helps organizations tap into such networks either just as a one-day event, or as a standing advisory board, much like they have done with P&G and their Design and Innovation Council.

A highly interesting approach to open innovation, which can serve as great way of tapping into external knowledge diversity. However i would find it important to stress that open innovation requires companies to build and maintain knowledge diversity BOTH on the inside AND on the outside of the organization to succeed with open innovation!

Researching open source innovation

Sladjana Vujovic is a visiting scholar here at Scancor / Stanford University, and because I find her research into open innovation to be both interesting and none the least important, I asked her for a mini-interview about her research.

Course why is it that we only learn about interesting research projects when they are all over and done with?  In the future I will therefore keep you informed about interesting research in the making  that I come across on my own innovation research journey.... And I am proud to hereby present my first innovation research in the making interview with Sladjana Vujovic:

Tell me about your research project?
My PhD thesis is about user-driven product development and innovation. The case I am studying is an Open Source Software (OSS) project. The purpose of my study is to offer insight into Open Source phenomenon through enhanced understanding of Open Source cooperation and product development seen from an organizational perspective – and to provide a meaningful guide to action for managers based on this study.

What are the primary findings?
I am only at the beginning of the data analysis. Hence, I do not have any concrete results yet, but I have made some interesting observations so far. One of them is the issue of recruiting the right people. Since OSS projects are based on voluntary participation, the challenge consists in how to attract the right people for the teams and how to fill out different roles.

Another thing I find both relevant and interesting has to do with the role of computer-mediated communication. There are some indications that some forms of online communication (which are actually used a lot by OSS communities) may not be best suited for an effective cooperation, decision making, discussions, execution and coordination of tasks. Furthermore, the world of virtuality creates an environment from which it is easy to disappear, when needed.

This thus has consequences for a person’s feeling of commitment compared to a traditional work place, where face-to-face communication and physical contact are present. Those are only a few of my observations… but more on them when I finish the analysis. 

What are the potential implications of those findings?
Managers need to realize that embarking on the open innovation journey implies different strategic choices between different strategies, and that it will mean increasingly having to balance the need for secrecy with the need for openness, as well as reconsidering the role and potential of their competitors and customers, who, in an open-source innovation context, may prove to be important partners.

From a strategic point of view, the OS-based alternative points to a need for a redefinition of the business model to take account of the fact that the focus of value creation has two loci of interest. One is related to the product itself. However, the associated incentive here is not directly financial (as in the traditional business model) but is indirectly of financial value, in the form of education and training (for the developer) and a higher degree of customer satisfaction (inasmuch as there will be no features the user has not asked for). Moreover, the direct financial focus of such a different business model will have to move further down the value chain to embrace new supporting consultancy and/or support services.

Where can I find more information about your research?
You can find more information on the Århus Business School Website:  or by contacting me via email

Open innovation - learning from the best!

Last week I had the pleasure of participating in an innovation session facilitated by IDEO, one of the most admired (especially by me) design and innovation companies in the world. I knew quite a lot about IDEO before this session, through books, journals and the media in general. Just as I had the pleasure of featuring Paul Bennett from IDEO at the INNOVATING WITH DIVERSITY conference last year.

But I had never seen IDEO in action, so of course this was an opportunity I had been looking forward to attend, with great anticipation. And I was not to be disappointed!

I was invited to the workshop by Ron Volpe, Director of Global Supply Chain Innovation at Kraft Food, so that I could observe in the workshop, and make use of these observations in my  ph.d. work. I met Ron last year at INNOVATING WITH DIVERSITY in Copenhagen, and even had the pleasure of organizing an event at Copenhagen Business School where Ron presented his Kraft Food approach to supply chain innovation, a truly great case in February.

The innovation session at IDEO was organized by Ron Volpe together with Target, in order to explore how Kraft and Target might find new ways to work together and improve their supply chain collaboration; through the identification and development of collaborative strategies and initiatives to engage in an open innovation process between Kraft Food and Target. The 35 people - most of them executives - from Kraft and Target had 2 days to do so. And boy, they truly did!

I can of course not share with you the results of the innovation session, but what I can share is some of the fascinating analogous observations we were sent out to do on the first day of the workshop. After having identified the primary opportunities for innovation at the intersection between Kraft and Target, we  were split up into smaller teams, who were each sent off to different places and sights around the Bay Area, to see what we could learn through analogous observations of people and organisations facing different, yet similar, supply chain challenges.

My group went off to a small private zoo in San Jose, where we met the woman in charge of all purchases of food and medicine supplies for the zoo animals, to learn first hand how she dealt with the logistics around that. We spent two hours at the zoo, learning everything from the use of dietary cards for each animal, to looking at storage facilities, to the preparation of food, to the shopping at the local Vietnamese market for vegetables and greens, and to the ordering or supplies and medication. It really was a fascinating peak into a totally different world, but the surprising thing was how much we could actually could benefit directly from the observations and insights in our own process, and how the learnings could be used and applied in the remainder of the workshop.

The other groups went to totally different places, one went to a Levis store in San Francisco, to learn from their approach to customization, where they were each to buy their own pair of jeans to experience the customization themselves. Another group visited Stanford Blood Bank, to learn from how they deal with freshness. Another group went to visit Sephora, for the ultimate shopping experience. Yet another group went to visit and interview a housewife about how she manages to store food worth 9 months of supply for her entire family. And many more interesting experiences. So as you can probably imagine, hearing about - and seeing - what each group brought home in terms of learnings and insights from their observation, was quite an interesting mental journey.

But so was the rest of the two days...... am still not through my 32 pages of observation notes from workshop yet ;-D