On my last (best) trip I also met with a leading edge Open Innovation, or more specifically Service Innovation consulting group out of Alexandria, VA - Peer Insight.  It was co-founded by Tim Ogilvie and Jeneanne Rae about five years ago.  Read up on them on their site I won’t rehash their vitals.  Jeneanne is also a regular contributor to BusinessWeek in said areas.

I mention them, beyond the fact that both Tim and Jeneanne are fascinating and super bright individuals, because they have nailed down an exceptional model for service economy corporations looking to innovate.  Quick test:  are you breathing, yes;  are you in business, yes.  Then your corporation is in the service economy.  I won’t give away the goods here; you should contact them and ask for their white paper entitled: “The Six Secrets to Business Model Exploration”.  Kudos to Gordon Hui, VP of Consulting @ PI…

For us at Fluid, we are working hard behind the scenes to know as many industry leaders as we can to learn and exchange best practices ideas that will shape the Open Innovation industry.  Better yet we have an idea to assemble the best of Open Innovation for the masses.

If you have experience working with the best and brightest in this business I want to know about them.  Thus the street shout out…

Tom 

I also read some great work from McKinsey here, Forrester (we were interviewed for this one) here and a recent one from Deloitte and Beeline Labs here.

On the tail end of the trip I had to leave and get back to work (start-up and all) and I have to say it was the best business trip over my tenure at Fluid Innovation.  Not because of some blockbuster order or new client signed (those are quite spectacular as well), but rather because one of our existing clients is: a) fascinated with the precepts of open innovation, b)actually doing something about, c) clearly sees how it will help them in nearly every facet of their business but will have an immediate economic impact.

The news is they are willing to do things “right”.  This isn’t going to be a one and done effort to retool the corporation with a bunch of internal portal content, buzzwords from management, HR policy and a huge technology investment for some unnecessary consulting and software that will “change their world”.   No huge co-creation labs and open solicitations for new, cool ideas to run their business. 

Their “wild” request was can we use our tools and marketplace internally so we can be certain that new innovations that we create in one division can be advertised, marketed and sold (think internal dollars here) to another division. Much of what they do doesn’t regularly see the light of day because of their client list, but between their clients there is very good reason to share.  They know they have tons of cross over in reinventing the same solutions or pieces of what could become a blockbuster solution if bundled together. Then for those thing discovered for external commercialization they will simply hook up directly with the Fluid marketplace.  Finally, they thought if this works for us we need to share it with our customers as well so they don’t go through the same wasteful remaking of the same innovations simply due to lack of insight.  Classic right hand/left hand metaphor.

So Tom did the endless hours of corn gazing fry your mind into popcorn?  Nope.  Where’s the innovation in all of that? I was just reenergized to see a very large corporation be willing to get on board with a relatively new idea, see the long term potential, but not rush past the obvious innovation right under their noses.  I’ll bet they become one of Open Innovation’s next generation case studies for doing it well, if not, doing it “right”.  I’ll share more as we journey down the Open road together.

Tom

For me, I am a bit less ambitious (arguable lazy - gasp) about the pursuit of Innovation.  Don’t get me wrong - huge fan - work at a firm with the word Innovation in its name.  That said, I believe many folks are pushing too hard, too fast to re-Innovate the entire enterprise or an entire product line, or create a net new widget. 

In the process they are rushing past less risky, more obvious innovation opportunities that might offer as much return and dare I say as much fun.  More on this topic soon.  I would love to hear from you about the obvious innovation that are going unnoticed in your enterprise. 

Tom

This is our mission at Fluid Innovation to keep improving on the process for making this type of Open Innovation possible.  Today the announcement of a new technology commercialization deal between Lockheed Martin and Rocket Software is a perfect example of the model and we are seeing increased activity from firms interested in mining and commercializing their internally developed technology as well as from independent software vendors that are looking for lower risk, lower cost strategic grown opportunities.  We welcome the challenge and absolutely enjoy the process of creating value in the market through these types of transactions.  Look for more announcements soon on other deals in our pipeline.

I am excited to see those persistent Inventors continue to look for ways to get their inventions to market.

My first global inquiry was from a group of 4 developers within an R&D Lab at a top petrochemical company in Saudi Arabia.  I’ll spare the name to protect the team (seems bizarre to think that, but you never know-they somehow found us…).  Suffice it to say their employer would hit the F500 deep within the top 100 based on revenues.  They wanted to know if we would represent the individual inventor.  They described a software innovation they had been working on “in their spare time.” and made it clear they did not represent their current company.

My sales instincts to this inquiry are “absolutely!”; however, we want to be smart about our focus and sparce resources. We are focused mainly on the F1000 and the Top 200 Universities.  It isn’t an exclusive approach;  it’s just a small company willing to stay disciplined with a specific target audience for now.  That said, we anticipated this exact type of inflow and our technology platform does account for this eventuality.  I call it architecting for the Fortune One Million.  If we’re right it may actually be the Fortune 10 million.  The Innovation flow across all disciplines is endless.

Another new friend approached us from India and made an inquiry about an IDE for gaming he is working on (outside of his day job), but it wouldn’t be done until early 2009; he wanted to be prepared.  A week later he pinged me back and said he’d finished another desktop application and wanted to go ahead and publish it on our marketplace in search of a licensing partner.

Regardless, I am going to work even harder to hurry our programs and platforms for these indivduals.  Stanford grads and Silicon Valley don’t need to have the corner on the next “Google”.  The treasure hunter, Kid-on-Christmas-Eve in me needs to get a look at all this innovation right away!

And personally, I’ d love to see more than oil pouring out of Saudi Arabia.

Tom

In an interview with one of the attendees, Maggie Miller, CIO of Warner Music Group she comments, “Every IT leader needs people on their team who are smart and brave free-thinkers, who challenge us. We need to listen to what they say – and not how they say it – if we are to innovate.”  She continues, “There is a vast array of good ideas both inside and outside of most companies, …The important thing is to open the door to those considering difficult or challenging concepts.” Full article here or here.

 Ms. Miller is spot on in both regards.  Not only do you want encourage a few free radicals, but you have to be willing to entertain outsiders who may have the best/right answer to your nagging issues.  None of us has the corner on all the brilliance required to solve every problem in our respective businesses.  Furthermore, it may be that you already have the solution to solving another firm’s most complex problem - unfortunately, neither one of you knows that.  But you should.

Additionally, I’d like to caution on the implementation of Open Innovation in the Enterprise. Aspirations aside, it has implications well beyond the IT organization, existing business processes, and senior management.  Haste may waste the opportunity.  I am living at the street level with many early adopters of these ideas and the pioneers are take a few arrows.

It will take a little more to unwind the linearity of decision-making and problem-solving that has been ”the way its always been”.   Cutting to the quick - nothing makes this transition go faster than some fiscal results.  Contrary to logic, the best place to start this process is to work in reverse. 

Ms. Miller, my advice:  go explore your organization and find innovation that you believe is best served in the hands of another organization.  Cycling through that process will do two things: 1) illustrate the organizational change required to invite the outside in going forward, and 2) by selling, or licensing your non-strategic innovations to others those dollars will peak senior management’s curiosity.  That’s your invitation to present the whole of Open Innovation as you describe above.  Tails wag dogs all the time…

Ms. Miller, it would be a pleasure to sit down and explore the specifics of making Warner Music Group truly innovative not only in solutions but organizational practicality and real results.

Tom

(author note:  I worked at Boeing from 1987 to 1989 in Facilities & Finance and my father was a 35 year veteran - long since retired now. And we had a bumper sticker on our car growing up that read: “If it’s not Boeing, I’m not going.”)

We are excited most by Boeing’s level of sophistication and maturity around software commercialization and IP licensing.  They have been doing it (well) for years and it shows.  They have been embracing Open Innovation for a long time given their requirement to collaborate so deeply, with some many suppliers, and so many industries to get an airliner built or a new government program launched.  For them to avail some of their compelling technology innovations to others has simply been integrated into their corporate DNA.  Furthermore, the team we work with is amazing - thorough, professional, and frankly fun to be around.  For you potential Buyers - they will work hard to ensure a great deal for your firm; don’t get nervous that you have to work with a Fortune 66 firm.  They will be good stewards of your time and resources.

Even better, once one of my Buyers found out about this announcement, I think his quote was, “well, now the the “Boeing store” is open here is a specific list of things I am looking for”[to license].  He is in the CAD/Computational Fluid Dynamics (CFD) software segment and prior to my outreach did not know that Boeing would commercialized its software innovations to companies like his.

I hope you’ll join me in thanking them for choosing to work with us and we promise to work hard making this relationship a wild success for each other, the Buyers and the industry at large.

Tom

The proverbial “behind the firewall” version - stuff that dreams are made of - for the wildly successful consumer application winners seems so appealing, Siren-like.  I am mixed about the concepts for a mixed up bunch of reasons:

1) I was one of the early employees within Yahoo!’s Corporate Yahoo! division (2001) - selling my.yahoo content as part of the raging early Enterprise Portal software days.  Every F500 thought they had to have a corporate portal akin to Yahoo! or AOL - as that would “get them on the web”.  I was responsible for partnering with the Enterprise software guys to convince them that OEM’ing my.yahoo content would spice up their portal software sales.  CIOs were definitely intrigued by the idea, but I don’t think we made BEA, SAP, Oracle, Sun’s quarterly portal software sales.  Oh, and the first feature we had to turn OFF - ads.

2) A $10 Billion Enterprise software marketing figure was quoted.  That’ a big number.  But I have to agree with David that those Big Dogs spending the Big Bucks - will take a pass on the ad stuff.  They realize that their employees are wasting time on Facebook (at the same pace they started wasting time on my.yahoo seven years ago) and embracing the beast won’t solve much - in the near term.  Not saying it won’t get here in my career-lifetime, but I am pretty close to some very big spenders in the F500 and this is not on their radar.  What the CIO really desires is the mass appeal, rapid adoption, zero training, and no maintenance costs (for us lucky consumer users).  Quick name the fastest adopted enteprise software application on the planet!

3) I do however want (and need) the concepts of Facebook, LinkedIn, Jigsaw and the like to pervade the fabric of those same IT Enterprises as platform concepts - social networking, mass collaboration, prediction markets, rapid application development - to blow open the door on the abject linearity of problem solving within those same Enterprises.   These application platforms are illustrating how to make the process more effective.  The best ideas, the best minds unfortunately don’t work in “your” firm.  It’s a big world; how do you invite the right minds in at the right time, or invite your friend whom you know is the right mind for the problem you just reviewed - and do it productively, securely, (insert CIO buzzword here).

4) Here in Austin we just saw our friends at Austin Ventures make a $50 Million commitment to Jeff Dachis, former CEO of Razorfish - to create social enterprise software and services.  It’s the right trajectory, but the pioneers have it a bit rough; the good ones survive to tell the tales and pave the way.  We need them.

I wish the Facebook PMs well on this one.  Guys, if you want some words of advice (or encouragement) before hitting the CIOs office - I’ll go get my notes.

So what does all this have to do with Fluid Innovation? I’ve got my reason, what do you all think?

Tom

It takes resourcefulness and creativity to embrace extremes - whether temperatures, ideas, business models, or macro economic trends - and then create something of interest or usefulness.  Which is why we are thrilled to have been selected by Gartner Research - Brian Prentice & Martin Reynolds - as one of 3 firms to be tapped as a “Cool Vendor in Intellectual Property 2008″.

We were honored for combining three extremes: decision science modeling - Prediction Markets, mass collaborative community engagement, and the stately business of Intellectual Property licensing, specifically software commercialization.  It’s called Virtual Ventures (here).   And it is but one of a number of extremely innovative concepts we are providing the IP Licensing and Software Commercialization industry.  More cool announcements about some hot new ideas this summer.

 Read more about it in our press release, or better yet go ahead and buy the full report.  It’s well worth the price. (here)

Ok, back to baking.

Tom

A little reflection time - we have been head down on so many big projects that sometimes it feels like nothing is getting done but one day you finally get a moment alone to reflect on just what progress has transpired and you are amazed at the result.  I think the idea to innovation process works much the same way, when you are in the moment you often don’t realize what your efforts are creating.  What can begin as a simple comment on a conference call can evolve into something truly unique.  In our case, an organized effort to bring standardization, collaboration and communication together to help shape and evolve the growing market for Open Innovation.  Expect an exciting announcement about how we are working with, not for, our clients to bring efficiency and visibility to the technology commercialization marketplace. 

As always, get involved and help the invention to innovation process by sharing your opinions on fluidinnovation.com and virtualventures.com.