One of IMD’s recent Discovery Events provided an opportunity for stimulating presentations and lively discussions on collaboration for entrepreneurship-driven innovation. This event made it possible to present work in progress at IMD on several of the many research projects being carried out on the topic of innovation-led growth. A growing number of top managers are increasingly concerned about innovating effectively for growth, while continuing work towards cost reductions.

The keynote presentation was delivered by IMD President Peter Lorange, who made a powerful case for the crucial role on entrepreneurship spirit and intrapreneurship in our companies, in order to lead innovation projects effectively. Indeed, the innovation process must be nourished by a lively and sustained dialogue with customers. This intimacy with customers allows the firm to identify opportunities, as customers are usually not able to be explicit about their future “needs”. The entrepreneurial perspective is critical and the CEO must “pump” resources and energy towards these entrepreneurs, in order to gain speed and effectiveness. Indeed, short-term results are increasingly critical; this is very much a fact of life.

Invited Professor Sigvald Harysson, from Lund University, stressed that firms should tap more into academia’s talent, giving the example of Porsche, who, each year, invites 600 students to make a contribution in various departments, engineering or otherwise. In the particular case of a ceramic brake, Porsche launched a competition between universities, resulting in a solution, which, thanks to its lightweight greatly enhances driving comfort. Bang Olufsen, on the other hand, spun out the outfit which developed a power-efficient way of producing sound, enabling the thin audio designs, which constitute BO’s trademark. This move makes it possible for other partners to share further developments of the device.

Professor Georges Haour presented and discussed his novel concept of distributed innovation, from his recent book Resolving the Innovation Paradox. He stressed that technology companies must first identify “high impact offerings” in the course of a process, led by the CEO. These firms then develop the offerings by proactively seeking and extensively tapping into external, distributed sources of technology, combining them with their own internal capabilities. In this way, they are less constrained by their internal resources. With such innovation leadership, proactive outlook in an entrepreneurial perspective, such firms become architects of innovation, gaining in speed and effectiveness.

Ilustrating the process of tapping into distributed sources of knowledge, Professor Corey Billington discussed the company "Innocentive", which puts problem-solvers and solution-seekers in contact via internet. An offshoot of Ely Lilly, this firm concentrates on chemical and life sciences, with already 130 000 problem-solvers. The latter are individuals, who freely join in and receive a fee, if their proposed solution is accepted. Solution-seekers are firms paying a membership fee, as well as a sum for each problem they pose to the network. If a problem-solver is interested in a problem, she/he signs a non disclosure agreement to access more information on the problem.

In order to identify new or improved business processes, can firms afford not to tap into such pool of knowledge, considerably augmenting their own capabilities?

Much discussion was concerned with the confidentiality aspect. True, by being open and in partnering, a firm may well leak business-sensitive information; this issue must be managed, but the consensus was that, in most cases, confidentiality is an excuse for remaining “internal”.

All in all, the perspectives presented all point to firms increasingly tapping into external partners’ expertise in a most humble way. The word outsourcing does not describe such a proactive and open approach.