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Nick de Leon on why open innovation is the key to unlocking growth for the future

'Open Innovation is a key tool to address future opportunities and challenges...We need to focus innovation on big, purposeful activities that serve people and build a better society post-Covid.'
Dr Nick de Leon, School of Design

What does Open Innovation mean to you?

Open Innovation is a way of bringing new value to market faster and more effectively by not trying to do everything yourself. It involves working with an ecosystem of partners that can help create value for you as a large organisation, as well as help you take that value to the market. It brings together design thinking – to make sure you're addressing really compelling needs with truly creative solutions – with an openness to collaborate and a lean startup approach that reduces risk. 

What are the benefits to embracing Open Innovation?

Often, especially inside larger organisations there is a huge amount of inertia and reluctance to consider new and more effective business models. Open innovation can open your eyes to new ways of thinking and can drive real cultural change. It injects new DNA and gives organisations the ability to experiment quickly and reduce risk. When working with businesses that have already introduced their solution to the market at a modest scale, you have proof of value creation as well proof of concept. That means you can scale very quickly, reduce risk and accelerate your time to value creation.

What are the challenges of Open Innovation?

Great ideas from outside an organisation find it hard to take root if they don’t fit your current business model or if you are not agile enough to transform that model to accept them. It can be hard to disseminate innovative solutions effectively across your organisation and get buy-in from finance, legal, risk management and all the other corporate functions. If you get a great pilot going you still have to absorb it into the mainstream operating divisions of the company. Only then can you create the possibility of fundamentally shifting the way you do business. You need to think about the challenges in terms of 3 distinct domains, how you originate new concepts, how you disseminate the internally or externally to achieve real buy-in, and how you achieve adoption of the resulting innovations at scale

Every organisation needs to have a clear, coherent and well understood  innovation strategy. And it  has to align with your business and organisational strategy. There is no point nurturing innovative ideas if they don't correspond with what the business is fundamentally trying to achieve. 

What’s the difference between Outside in and Inside Out Innovation?

Some of the most successful innovations come from large companies that have an idea that their business model cannot support on its own. However, if they work in partnership with other organisations those ideas can be commercialised much more successfully. Just as you don’t need to originate an idea to profit from it, similarly your ideas and know-how can enable other organisations to prosper and you can benefit too. Open innovation requires  flexibility with your business model and how you engage and nurture all sorts of partners to create upstream networks that enhance your value proposition as well as downstream networks that can take those solutions to market better than you can. So Open Innovation means not only sourcing ideas from outside but also taking ideas from inside the organisation and commercialising them through other channels. 

As Sonal Lakhani, Global Head of Strategic Programmes and Innovation at Barclays explains: 'the true art to Open Innovation is creating the most porous wall possible between the corporate and the startup ecosystem – where we must be bringing the inside out as much as we are bringing the outside in.

How do you see Open Innovation changing up to 2025?

We need to focus innovation on big, purposeful interventions that serve people and build a better, fairer society in a post-pandemic era, a new model of prosperity that is in harmony with people, planet and nature. That is what governments, industry and communities are interested in and what benefits us all as individuals.

Open innovation can enable a much more empathetic approach in the way we nurture ecosystems, engage customers and work with colleagues. More empathic innovation is the key to future success and growth, including empathy with nature to address the immense sustainability challenges we face. In fact I would say that the future of Open Innovation is Empathetic Innovation.

Dr Nick de Leon is Course Leader of the new RCA short course ‘Open Innovation Masterclass in collaboration with London & Partners’ starting 21–22 February 2022.

Guest Speakers from industry include:

Katy Ho, Head of Innovation Practice for Future Networks, Digital Catapult
Tanveer Aziz, Head of Innovation, UST
Andrew Humphries, Co-Founder, The Bakery

Book now – early bird fee until 24 January!

Interview adapted from the 2021 Barclays Rise report, ‘How corporates can develop partnerships with FinTechs: A deep dive into how large organisations can engage with startups to accelerate Open Innovation’.  Download the full report here.