Much has been said lately about how open and collaborative innovation requires different parties to achieve outcomes built on trust. Indeed, we identified “lack of trust” as the number one reason why teams fail in our November 10 blog post. 

I looked up “trust” in Wikipedia and learned that in sociology and psychology: “…the degree to which one party trusts another is a measure of belief in the honesty, fairness, or benevolence of another party…”

One of the complications in collaborating with external parties is that building a belief in the other party’s “honesty, fairness and benevolence” usually requires a series of face to face interactions that convince each party of the other’s benevolent character. What’s more, the “trust” factor may extend to the party’s representative, but perhaps not to the whole company.

This is why it so essential for any practitioner of Open and Collaborative Innovation to have a structured program for  “Partner of Choice” messaging. This encompasses guidelines on how much flexibility is given in negotiations, creation of “win-win” legal agreements, and an openness on the intentions, goals, and the deal breakers. The mantra needs to be “no surprises”.

On the subject of win-win legal agreements, I was at IP Week in Brussels last week, where I (as well as other great companies like Intel, L’Oreal, and Arthur D. Little) spoke on Open Innovation. The audience was full of IP and Patent Lawyers. After our respective speeches one lawyer asked: “How does the legal profession have to change in order to get better at Open Innovation?” I responded that there are 2 major things: Number one is to think in terms of what the other party would and will find acceptable in order to create a “win-win”. Too many times negotiations start out with a legal agreement that EVERYBODY knows the other party cannot accept. Softening the standard corporate term sheets would be a good first step. Number two is to think in terms of “acceptable risk”. It is kind of linked to the first item, but really, any time you talk to lawyers, the focus is “risk, risk, risk”…However, I often resort to asking lawyers – what is the likelihood of this or that event happening, and often it is negligible! When you’re clear on what risks are acceptable you are a long ways towards being able to create a good basis for negotiations.

So, to build trust, the partners need to be open and clear about their intents, objectives, and the process, AND be fair and balanced in crafting a legal framework for collaboration.

The result according to Wikipedia: “Trust is also seen as an economic lubricant, reducing the cost of transactions, enabling new forms of cooperation and generally furthering business activities, employment and prosperity.”

Best wishes to all of you, and keep building the trust!