The first part of the iKNOW-WHO method comes from the Japanese practices in technology and innovation that emerged in the late 1980s when companies like Canon, Sony and Toyota prepared to leapfrog their Western counterparts in growth through innovation. Just like Wendelin Wiedeking, in the mid-1990s, leapfrogged several conventional steps in the automotive value-chain and transformed Porsche into a company that stepped up from making cars to making money, the Japanese corporations that took the lead in the 1990s had all one thing in common: they performed external networking for technology breakthroughs and kept the internal focus on innovation. Having made 160 interviews with managers and executives in R&D and innovation within Canon, Sony and Toyota for my PhD on Japanese R&D Management, I thought I had a basic understanding of the method. A life-changing meeting on June 6th 1994 triggered a radically new interpretation of my holistic analysis. I met with Akio Morita, the founder and chairman of Sony and had prepared several sharp questions around innovation performance. However, no matter how I posed the different questions, his answers were always the same: “The more people you know, the better it is”. The whole approach of Sony and all other Kaishas that wrote history in transformational growth through innovation was know-who based – focused on developing networks to people having the know-how needed to succeed.
In the age of the Internet, making contacts is made easy, but contacts that are purely web-based rarely contribute to breakthrough innovation. Co-creation requires physical interaction among all parties contributing to and profiting from multidimensional cross-fertilization both of explicit and tacit knowledge.
Taking the origin further
Knowing a lot of people and interacting with them in person is a good start, but it still will not lead to extreme breakthroughs in short time and at low cost. For this to happen, competition is required and this is my second learning from Japan. Having worked for a decade in ADL, BCG and BAH I have seen a lot of company-supplier relationships and transactions. In the West, these relationships and transactions were fundamentally different from the ones I experienced in Japan. While my typical clients in the West would consider a few technology development suppliers for an R&D project, all except one of these suppliers would be eliminated already in the development phase and then be the only partner for the commercialization phase – once development and validation phases were completed. Things were very different in Japan, where as many as five suppliers would normally compete in parallel to deliver the best solution all the way through to commercialization, which would be supported by the winning supplier – the innovation partner for that specific product/project. The five suppliers were forced to regularly present their results in front of each other. Extreme learning in open and competitive relationships.
Two decades of working with the best companies in Europe, such as Porsche, Nestlé, AkzoNobel, Bombardier, Tetra Pak and Philips, helped us refine a method that applied the same principles – but to university teams.
But this is not enough
Having five suppliers in competition to deliver the best solution gives the innovation integrator good comfort to have an excellent solution from the best supplier. This still does not guarantee that a breakthrough is co-created.
For extreme breakthroughs to happen, multi-disciplinary cross-fertilization must take place continuously among the competing suppliers – in our case carefully selected university teams. This is where iKNOW-WHO adds the unique method of collaborative university competitions®. We kick-start a competition, but maintain strong collaborative elements among the university teams throughout the competition and award both the best solution and the best knowledge contributing team with equal honor and compensation. All reviews are made openly in front of each other for accelerated co-creation. The development and refinement of this method both triggered and benefitted from a second PhD project focused on how to manage knowledge creation processes for breakthrough innovation to happen. It was further sharpened through a post-doc on new business models for industry-university collaboration leading to docent competence in this area.
While the primary uniqueness of our method is to capture and involve also the relevant tacit parts of knowledge in the co-creation process, we also have an iKNOW-WHO portal for explicit project knowledge from individual teams to be proactively exchanged and acted upon among all competing teams.
Selecting the “Best” Candidates for Extreme Breakthroughs
We make a great distinction between “the best” and “the best-suited” teams. The former is easy to find through different citation indexes, patent searches and lists of publications, but being “best” in a datasheet is not the same as being best at co-creating breakthrough innovation – rather the opposite. We often find that a reversed logic applies – without describing any further how we select our teams or why they normally come from the “Wild East” such as the Eastern Nordics, Eastern Europe and South East Asia.
The value chain imperative supporting extreme breakthroughs
Bringing university teams into the collaborative competition without having SGL as a manufacturing partner would not have resulted into a breakthrough in brakes for Porsche. For each extreme innovation challenge our Clients bring to us, we establish a collaborative competition based not only on the best suited university teams, but also including manufacturing partners from the most critical parts of the value chain required for the extreme breakthrough to reach reality. Based on 20+ years of experience in industry-university collaboration, I can firmly confirm that the best companies rarely select the best suited university teams as close co-creation partners of breakthrough innovation
Simplicity trumps complexity
As Albert Einstein once said: If you can’t explain it simply, you don’t understand it well enough. A disruptive breakthrough may be highly complex in terms of required technologies and skills, but the brief must be simple. It is our main-task to co-create this brief – not only with the client, but also with the targeted challenge-solvers to make sure that all co-creators understand the target as such and how target-fulfillment will be assessed.
Before even co-creating the challenge description, we invest valuable time with our Client to find the best-suited challenge to be solved. We do this based on clear metrics.
In many projects, we end up with a final solution that was too simple for the (too) senior experts within the Client organization to even consider.
The fact that we often co-create breakthroughs that were too simple to be realized within the Client organizations, makes the dealing with domain experts a very delicate matter indeed. Experts are mainly willing and mentally able to embrace new ideas that support the vast pool of expertise that they have already accumulated. By contrast, experts are rarely inclined to embrace, or accept, new ideas that have high degrees of novelty in directions that are far away from the current pool of expertise that they possess. Therefore, the most senior experts are typically the biggest barriers against the breakthroughs that we co-create.
Attitude for co-creation
As wisely coined by Winston Churchill, “The pessimist sees difficulty in every opportunity. The optimist sees the opportunity in every difficulty.”
The Client company must join our passionate belief that we will make it happen – together. Within the Client company, there must be challenge owners open enough to share the essence of the difficulties they ran into and explain in detail how these difficulties prevented successful resolution of the extreme challenge.
The Client must, therefore, chose challenge owners who are open to share experience from failure from the very beginning. The worst kind of challenge owners are those who remain closed during the first half of the six-month-project and then become open only at the final review with comments like “we tried that solution before and here is why it did not work”.
Besserwissers are as great at explaining why things do not work as they are poor at seeing radically new things that will work.
Crucial Moments in Co-Creation of Breakthrough Innovation
The kick-off needs to convey top-management belief and dedication that we will make the breakthrough happen and openly reveal why it did not happen so far. It should be designed in ways that inspire all participants to see that not even the sky is a limit.
The mid-term review is an essential platform for inspiration, knowledge-sharing and, of course, for co-creation to present and sharpen the solutions in directions that are well-aligned with the needs of the customer.
Knowledge-contributions are monitored throughout the six-month process and the team that earns the highest knowledge-sharing score is getting the same financial reward as the team presenting the winning solution.
We measure our success in real breakthroughs reaching global markets while being safely protected through awarded PCT-filed patent applications.
We do not measure our success in terms of exciting concepts described in PowerPoint and assessed in excel tables. This may be a excellent starting-point of a breakthrough, but it still needs to define and validate a value-chain and find a profitable business model before it is anywhere near a real breakthrough with clearly perceived customer-value.
We continually measure and communicate Team performance in terms of knowledge contributions. The Team that scores the highest in terms of knowledge contributions made throughout the competition will get the same amount in award as the Team presenting the winning solution – because co-creation does not happen without knowledge-sharing.
University Teams are kept small enough to make it impossible for poor performers to hide behind the crowd. We are as merciless in immediate exclusion of poor performers and free-riders as we are generous towards the most knowledge-sharing teams.
We do not see a positive correlation between increased involvement by Client R&D resources in the collaborative competition and successful outcomes. Strong involvement by Client R&D is required during challenge-definition and open sharing of past attempts, but then the university teams need entrepreneurial freedom to make the impossible possible – without the Client’s most senior experts stipulating what is possible and what is not.