Opening communication for open innovation: Should you share your strategy?

“Open Communication” is frequently cited as necessary for successfully working with partners. When I was reading Stefan Lindegaard‘s post on Open Innovation Lessons from P&G, I was struck by this statement in particular:

Understand that open innovation requires open communication.

I’d say that’s an understatement. In my experience, opening up to the depth of communication required for successful open innovation is often a scary proposition for companies.

Stages of opening communication

With their Connect + Develop program, Procter & Gamble (P&G) have become one of the icons of open innovation. With good cause. Their program portal touts more than 1000 completed agreements, in-bound and out-bound. When you hear P&G people talk, it seems like their program has not only transformed the company but might even be called an awakening.

Like many companies that have engaged in open innovation aggressively, P&G has chosen to be public about what they are looking for. They publish needs and wants on their website. They give talks and seminars. Merck does something very similar by publishing areas of interest and disseminating their interests at conferences like TechConnect.

Both of these companies have decided that working with external communities is an important part of getting where they want to be. And they’ve learned those same external communities can do a lot more to help them, and help them efficiently, if they communicate what they really want.

This is fundamental, but it surprises me how often it’s overlooked. Depending on the stage of maturity in open innovation, I’ve seen several approaches or phases that companies will go through:

Phase 1. Companies don’t open up so ask to see everything

At the earliest, technology scouting functions simply look broadly at what might be interesting. I jokingly call this the “catalog and shopping mall” phase, in which I’m asked, “Can you just send me a summary of everything you’re working on, and I’ll see if there’s anything of interest.” Frankly, I was naive enough to attempt to respond to these requests when I first started doing business development for PARC, but I’ve never seen it work for either party.

Phase 2. Companies share only the most pointed needs

The next phase is when the scouting function begins to describe specific point needs, such as those that can be sourced through matchmaking services as InnoCentive, NineSigma, yet2.com, and others. These are great for finding very specific solutions, such as an adhesive with specialized properties, or a technique for coating  surfaces. I’ve wondered, though, how often the really high impact business opportunities come from just finding that one missing element?

Phase 3. Company employees seek opportunities by engaging in open conversations

Which brings us to the most mature programs.  These are the ones in which companies go beyond “technology scouting” to see multiple ways to make money — by building on work done outside their boundaries.

They encourage employees throughout the company to look for opportunities to extend revenue, and provide mechanisms for employees to bring attention to those opportunities. They engage partners selectively in discussions about what they are trying to achieve, and can therefore rely on their partners to co-create technologies that address market requirements.

In short, they are willing to tell others where they are going, so others can help them get there.

How to share your strategy

Should you share your strategy?  Yes, with deliberate purpose.  If publishing needs on a website is just too big of a step, consider the smaller step of establishing a trusted network within which you can constructively share strategic directions.

Otherwise, your partners will have a very hard time figuring out how they can help you.