Now that you have made the decision to get started with open innovation and you have the management team lined up behind you - it is time to think about the scope of the initial program. Many times this initial program is referred to as a Pilot Program.
Pilot Programs are a proven approach to reducing risk and addressing the many tasks in implementing open innovation. Pilot programs are a well understood concept in most firms and are used to test new markets or introduce new products into a limited market prior to a major roll out. Pilot programs deliver valuable knowledge about the viability of the proposed concept in the actual operating environment. There is no substitute for the value of a working prototype as a learning tool, particularly when the critical resources of time, people, and budget are being considered. A well scoped open innovation pilot program will provide:
• A manageable scope in terms of projects, people and time
• A “test drive” of the work process by key stakeholders
• Understanding of potential organizational changes and impacts
• Increased buy-in for an overall open Innovation strategy
• Key success factors for an expanded program
• A defined decision point on the benefits of finding and acquiring innovation globally
In thinking about a pilot program, one must develop a program that is not so small as to not fully test the benefits of open innovation to the organization, but also not so complex and over-reaching that there is a long period of time until the benefits are realized. The scope of the pilot program will come down to two key factors. These are:
The first is leadership commitment to open innovation. By this, I mean is open innovation viewed as an experiment because the firm has not bought into the benefits of open innovation, or is this the first step on the path to transforming the way the firm does innovation? If it is an experiment, then the focus needs to be on quickly demonstrating the value of reaching broadly outside the firm to advance a current program forward. This will make the initial open innovation program more project focused. If this is the first step on a broader transformation, then a larger scope that includes open innovation process, roles and responsibilities and metrics should be undertaken. These pieces can then be piloted and adapted as one learns and goes forward from the initial open innovation program.
Second is the size of the firm. If the firm is mid-sized with a centralized innovation organization then the scope of the program is a matter of how many people to involve and how many open innovation projects to launch. If the firm is a large, globally distributed organization, then the initial program can either be piloted in a single SBU or spread across a couple of SBU's and then rolled out to the broader organization.
Once the above two questions are answered, then developing and finalizing the scope of the open innovation pilot program is a matter of defining the resources required in terms of people, time and budget.
The last point is to establish a defined decision point to evaluate the program. This can be as simple as a leadership review that looks at progress made or a more formal review using metrics that were established at the outset of the program. Either way, the positives and negatives should be identified and reviewed.
In the next post we will discuss selecting the right Needs for the open innovation program.