More on Constraints and Network-Centric Innovation

Good post by Satish Nambisan about the challenges companies face moving from firm-centric innovation to network-centric innovation. It nicely extends my earlier post about open innovation. 

From Satish's post:

Thus, the point that I emphasized most in my presentation (and which I think resonated well with the attendees) was the importance of a company’s context in evaluating its network-centric innovation strategy. A company has to develop a deep understanding of the various external innovation networks that exist and relate them to its own unique market and organizational context. Only with such an understanding can it position itself appropriately in the landscape of network-centric innovation.

In short, CONTEXT MATTERS! And, acknowledging that is the first step towards success in network-centric innovation.

I would add that in addition to context, constraints also matter. BIF research advisor Larry Huston who is the former VP of Innovation at P&G and the father of the Connect + Develop business model says the value of the external network is not in coming up with a new idea—it's about solving important consumer problems. And the onus is on P&G to be exceedingly clear about the conditions and parameters of a particular problem so their network of problem solvers can get to work. To do that, the company collaborates with organizations and individuals around the world, systematically searching for proven technologies, packages and products they can improve, scale up, and get to market fast. The company is very clear on what they're looking for and how value gets created. Without proof of concept, they don't move forward.

I would also add that network-centric innovation is not for the faint of heart. To Satish's point, you've got to learn how to walk before you can run. And to be your own advocate in a networked world requires that you've first built a sustainable, repeatable innovation capability and innovation culture within your own organization.

Here at the Business Innovation Factory we're developing the language, case studies and metrics around what it means to deliver value in a network-centric environment. We believe that championing collaborative innovation through experimentation leads to an understanding of the practices involved in institutionalizing network-centric innovation. You can learn more about what we're up to over at our Experience Labs.

Satish has co-authored a new book called The Global Brain. I've just begun to dig into it it and will provide a review here at the blog soon.

RELATED

• Read my article Even Giants Start Small to learn more about P&G's Connect + Develop business model.
• Watch BIF research advisor and innovation intermediary Ellen Levy talk about living the network effect. She's learned how to take advantage of the enormous arbitrage opportunity at the information layer - finding all kinds of ways to move information between individuals who otherwise would not find one another or share their insights.