Best Practices in Open Innovation

An interview with Cheryl Perkins, respected innovation thought leader and co-author of Conquering Innovation Fatigue: Overcoming the Barriers to Personal and Corporate Success.

Cheryl Perkins is a respected author and thought-leader in innovation as well as founder of Innovationedge™, a consulting firm specializing in strategic innovation and growth for senior executives, entrepreneurs and inventors worldwide. Perkins actively contributes to growing the practical knowledge of Open Innovation in her role as chair of the annual Co-Dev Conference.

Anne Orban, Director of Discovery & Innovation at Innovation Focus, and co-author of the chapter titled, American Productivity and Quality Best Practices Study: Using Open Innovation to Generate Ideas published in the PDMA’s New Product Development Essentials* (2014) book on Open Innovation, asked Perkins for her comments on the APQC study.

Perkins notes that the APQC study’s 11 best practices and 5 enablers were consistent with her experience. In the study, APQC noted, “there is no single best way to implement and manage Open Innovation.” They did find “a number of best practices consistent across leading companies in the categories of strategy, roles, processes, and measurement and improvement.” Specifically:



1. Focus on targeted, needs-based Open Innovation.
2. Partner broadly across a variety of external and internal organizations.
3. Position the organization to build and manage key relationships.
4. Allow Open Innovation maturity to drive the approach to intellectual property ownership.



5. Establish a small, central, dedicated group to drive Open Innovation.
6. Seek Open Innovation team members with specialized skills and backgrounds.



7. Integrate and align the Open Innovation process with other relevant processes in order to ensure key entities are involved at critical points.
8. Embrace broad and specific scouting for new ideas.
9. Invite participation in Open Innovation through varied experiences.


Measurement and Improvement

10. Seek compelling measures for Open Innovation.
11. For Open Innovation to stick, change management is essential.


“There are three areas in the best practices list that I would call ‘watch outs,’” says Perkins.“Watch-outs,” she clarifies, “are areas of practice in which organizations are uncertain about execution.”

Specifically, in APQC’s best practices in terms of establishing a small, central dedicated group to drive Open Innovation, Perkins notes that, in her experience, this is indeed ideal but very few companies have done this. “Many involved in Open Innovation have another role to do in their organization.  And, in addition to that, there is a tendency to put technology scouts in the Open Innovation leadership role inside corporations. That can only work if the individual has the right relationship-building and communication skill set. In our experience, it works well to have a Finder who scouts opportunities and a Catcher who executes.”

Perkins agrees that measurement is certainly a key best practice. However she noted that, “The challenge within that best practice is how to persuade business people that what you are measuring really matters. Measures of enablement are rarely understood or appreciated by business people as important indicators of Open Innovation’s success.”

According to Perkins, seeking compelling measures for Open Innovation is far from easy. “Open Innovation efforts need to be seen in the context of a continuum into the future, not the immediacy of a quarter. They need to demonstrate business value and growth into new areas,” she says.

For Open Innovation to stick, “change management is essential” is best practice #11.  Perkins points out that this is true for innovation in general. In fact, she counsels, “Open Innovation should be considered as one enabler within a culture for innovation that is organization-wide.”

Perkins also points out that semantics can really trip up understanding of Open Innovation.  “Part of the rationale for more Open Innovation is to access emerging or disruptive technologies. These terms are often used interchangeably especially in CPG companies. Essentially, companies develop their own definitions for open, emerging or disruptive innovation that are based on how each organization wants to refer to its own portfolio that may or may not be aligned with industry definitions from professional associations, academe and consortia. Open Innovation today goes beyond technology – it also encompasses expansion into new markets, channels and integrated product-service delivery,” Perkins says.

When asked what excites her most about Open Innovation today, Perkins responds that it is the multi-organization deals.  Multi-organization deals are needed and also executable because, to get out a new product, more than one ingredient is needed. Also exciting for Perkins are the changes happening in industry sectors such as chemical companies in terms of their posture towards Open Innovation. She says that chemical companies are moving to be more assertive. “They are building on their continuing efforts to find their own innovations using the same best practices as CPG companies, and are emerging from a ‘wait to be found’ posture to a ‘going out to find partners’ posture,” Perkins says.

The APQC study focused on idea generation that refers to access to ideas and then on the deal structure. Equally important, Perkins says, is execution. “Many companies experience internal barriers to leveraging their own emerging or breakthrough technologies because of business silos. Enabling internal Open Innovation is also an important opportunity for innovation. Above all, when executing Open Innovation, linking with internal processes is really important so as to overcome the ‘not invented here’ mentality of seeing technology from outside the organization as a foreign body. The most successful companies, in our experience, assess both internal and external innovations to ensure the best solution. Recognition of both is very important in keeping motivation high. In the APQC study, Cisco is a good example of a company that has thought that through and developed mechanisms for effectively overcoming that obstacle,” Perkins says.

*Noble, Charles H., Durmusoglu, Serdar S., Griffin, Abbie, 2014, Open Innovation: New Product Development Essentials from the PDMA, Hoboken, New Jersey: John Wiley & Sons Inc.

* Footnote: Conquering Innovation Fatigue

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