SMES IF EVERYBODYS DOING IT WHY ARENT WE? KATHRYN LYNCH Inbound - - PowerPoint PPT Presentation

OPEN IN INNOVATION IN IN IR IRIS ISH TECH / ENGINEERING SMES

IF EVERYBODY’S DOING IT WHY AREN’T WE? KATHRYN LYNCH

OPEN IN INNOVATION? HUH?

• Inbound Acquire external

knowledge for internal use

• Outbound Reveal / Sell /

Exploit IP or technology externally

• R& D Collaboration with

specialist knowledge partners

• Access specialist talent

WHY COLLABORATE?

Reduce the cost of innovation through partnerships with other

• rganisations

Increase the reach of firms in identifying new ideas, technologies and markets Reduce the risk of commercialising new ideas, technologies or products Increase the speed of development from idea to innovation ….yet only 9% of Irish SMEs engaged in collaborative innovation (and 30% innovating

• verall)

SO WHY NOT MORE SMES DOING IT IT?

Although limited by financial and human resources….

• SMEs better positioned to use

their social capital to collaborate

• SMEs can address niche markets

that larger firms are not interested in

• SME innovation can

proportionally ‘move the needle’ for a smaller firm vs a larger peer

• SME agility and entrepreneurial

culture fosters open innovation

• SME Founder/CEO competences

and experiences drive innovation culture

• Rural Irish SME adopted MS Hololens and shared the equipment and

know-how with cluster members…. and now exporting to Asia!

• Cluster members sharing specialist resources.
• Another 8-member cluster creating a ‘shared’ graduate programme.
• Belgian bicycle maker now collaborating with a design house (of

garden furniture!) - turnover x 4 in 6 years

• Danish quilt manufacturer licensed tech from NASA to create ‘Temp

Controlled’ quilts and dominates new niche market

• French ‘ Technopole’ companies meeting every week and working

together with wrap-around IP/Legal/Business services provided by the business park

I.D I.D. . CRITICAL SU SUCCESS SS FACT CTORS FOR OI

Research for last 15 years pointed to :

• Leadership
• Internal Innovation Capability
• Network & Relationships
• Strategy
• Technology Management
• Culture

LEADERSHIP

• STRONG FOUNDER/CEO LED

INNOVATION EVIDENT, RELIANT ON THEIR SKILLS

• LIMITED CAPACITY TO DEVELOP

INNOVATION LEADERSHIP AND MANAGEMENT COMPETENCES IN SMALLER FIRMS <100 EMPLOYEES.

• SME LEADERS RECOGNIZE

IMPORTANCE OF EXTERNAL NETWORKS BUT NONE WITH ANY DEFINED STRATEGY FOR ENGAGEMENT.

• NETWORK PARTNERS RECOGNIZE

THE NEED TO PROVIDE ‘LEADERSHIP’ IN ABSENCE OF SMES.

• UNCLEAR IF ANY SME LEADER

WOULD STEP UP TO ACT AS NETWORK ORCHESTRATOR IF NOT PUBLICLY FUNDED.

IN INTERNAL IN INNOVATION CAPABILIT ITY

• All SMEs show dynamic capabilities to build/develop new

skills – primarily in response to customer demand, but little evidence of governance or structures.

• Informal knowledge exchanged in cluster memberships

enhances overall competences and shares expenditure.

• 1 of 6 SMEs with clear appropriation strategies around IP

management, selective revealing and collaborative R&D.

• 3/6 network partners recognise the need for directed

training supports for SMEs to build their innovation capacity

NETWORK & RELATIONSHIPS

• Limited IP management strategies - 2/6

(larger SMEs) with IP protocols.

• Informal coordination of professional and

personal links to create relationships, rather than purposeful networks or alliances.

• Trust in potential partners and lack of

information on their trustworthiness is a key ‘market failure’ for OI.

• Geographical proximity and regular contact

key for building trust.

• SMEs in Clusters utilizing the relationship to

share knowledge, not create products.

• Quality rather than quantity of partners is

key – 3-5 (4.2 optimum) or ‘cognitive

• verload’
• Competitors in networks not welcome in

reality (although Literature says otherwise!)

STRATEGY

• ALL SMES COMMITTED TO INNOVATE.

INVESTMENTS OF 5-10% OF TURNOVER GREATER THAN THE INDUSTRY AVERAGE (3%)

• 1 OF 6 SME WITH AN EXPLICIT

STRATEGY TO SOURCE EXTERNAL KNOWLEDGE

• CHALLENGING TO ASSESS ABSORPTIVE

CAPACITY OR IMPLEMENTATION COMPETENCE DUE TO VARIANCE IN SIZE OF FIRMS AND LIMITED EXTERNAL ENGAGEMENT.

• OPPORTUNISTIC PARTNERING RATHER

THAN PURPOSEFUL SEARCHING

• NETWORK PARTNER: CONCERN THAT

‘CHASING FINANCES’ OR GOING FROM ONE FUNDED PROJECT TO THE NEXT IS NOT A SUSTAINABLE APPROACH.

TECHNOLOGY MANAGEMENT

• ALL SMES AT ‘EXPLORING’ STAGE.

1 /6 SMES EXPLOITING NEW TECH WITH IP.

• 1 SME SHARING TECHNOLOGY

AND KNOW-HOW WITH CLUSTER MEMBERS.

• NO SMES MEMBERS OR

PARTICIPANTS IN STRATEGIC TECHNOLOGY NETWORKS.

• LIMITED COMPETENCE TO FULLY

CALCULATE TRANSACTION COSTS IN TECHNOLOGY PARTNERSHIPS OR TECH TRANSFER.

• EXPECTATION MANAGEMENT KEY

FOR SME ENGAGEMENT WITH ACADEMIC TECH RESEARCH.

CULTURE

• Driven by the CEO – entrepreneurs

– seeking ‘new combinations’ - higher risk tolerance.

• 1 SME had an explicit company

value ‘Everybody is responsible for innovation’

• Larger SMEs (+100) had the

resources for R&D departments, metrics and organisational learning

• All SMEs demonstrated

experimentation and free flowing of info.

• Limited evidence of objective

alignment to promote diversification

• Is it innovation or evolution?

SO WHAT NOW?

• Rethink what it is to innovate

collaboratively – its not just about product!

• Orient the firm to source knowledge

externally

• Create/lead a culture of looking

externally for potential innovation – not just customer led as may ultimately limit the overall innovation capability of the firm.

• Recognise the limitations or

knowledge gaps of the organisation and potential avenues to upskill existing resources or bridge the gaps externally.

• Think creatively about resource

financing and ownership - (BES scheme), shared resources, shared usage, licensing.

BUILD TRUST !

• Leverage personal, educational

and professional networks to identify potential collaborative partners (3-5 max).

• Must include a customer
• Local and proximate – meet

regularly

• Similar size and characteristics
• Complementary skills and

motivations

• Set clear outcomes and
• bjectives
• Qualify any invitation to join

networks or alliances – motivation; commitment, no competitors; regular meeting schedules

BE PERSISTENT!

• Identify what skills and knowledge
• r resources you are prepared to

share.

• Be a champion of innovation or

network orchestrator in your area.

• Identify key personnel or agencies

who can assist the development of innovation capabilities.

• Leverage all available supports.

Dedicate/share resource time to applying for supports.

CONSIDER…….

• Are you truly leading an innovation culture?
• Are you prepared to be a champion of

innovation?

• Can you identify resources or knowledge that

you need for your organization?

• Can you identify 4 other, complementary

companies who could help you with that?

• What information, resources or machinery

could you share with them?

• What are you prepared to commit to

developing a relationship with them and build trust?

• What supports can you avail of to develop

innovation in your company?

EMAIL: KATHRYN@CHRONOS.IE WEB : WWW.CHRONOS.IE

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