Archive for open innovation
A culture that can protect trade secrets is vital for innovative companies. Such a culture becomes especially important in collaborative innovation efforts where failure to protect trade secrets can severely damage partners and the offending company’s reputation.
Chinese companies are increasingly recognizing the value of what the West calls “open innovation.” In fact, forms of open innovation were the basis of a great deal of innovation in China long before the term was coined in the West. Innovation in China tends to be fueled by guanxi with trust between partners being far more important than the legal details drafter by lawyers for a joint venture or other collaborative effort. Innovation in China, though still largely overlooked by the West, frequently occurs as trusted friends or acquaintances discuss their needs and challenges and find new solutions by crossing disciplinary borders. The many partnerships and allies involved with leading innovators like Ten Cent, Alibaba, Foxconn, and Huawei testify to the fluidity and rapidity of innovation in China achieved via collaboration and shared vision among partners.
However, when companies in China or anywhere collaborate to find innovation, the inevitable sharing of trade secrets between partners puts the players at risk should there be inappropriate disclosure. Two leaders may fully trust each other, but if one of them leads a company with a weak IP culture where individuals fail to respect trade secrets, the partnership can be destroyed and severe damage can be done. Those engaging in a collaborative venture should be aware of the risks and consider their own culture and processes, as well as the culture, processes, and track record of partners. Zealous efforts are needed to avoid harm, even when there is no intent to harm or defraud. Simple slips can disclose information inappropriately and hurt a partner and one’s own reputation. Those pursuing open innovation need to pay particular attention to trade secret protection and ensure that only a few well trained employees will be exposed to the trade secrets involved in the partnership.
Unfortunately, university culture in China and throughout the world, generally speaking, is inherently geared toward sharing and publishing information, so partnerships with universities should be carefully pursued with the realistic expectation that information may be leaked. Containing the scope of the partnership and minimizing any sharing of corporate secrets can reduce risks, while still allowing a company to tap the many riches of knowledge and innovation in China’s academic community, where many companies are finding success in advancing innovation.
Many large companies take a tortoise approach to innovation and stay as hidden within their shells as possible, even some who advocate open innovation. Tortoise companies may have creative R&D staff, including many scientists doing good work, but they keep these inventors hidden in the shell rather than encouraging them to publish or present their work.
The hares, on the other hand, take greater risks as they frequently step out of their comfortable burrows. They let their inventors not just show up at conferences and other events, but take the podium and present. Or, when appropriate, publish their work in major journals. As a result, their inventors become known and get to know many others with related interests. It is that visibility that allows potential partners to find them, to learn about their work, and to come forward with proposals for partnership or further innovation. These visible minds become more highly connected and able to contribute more directly and effectively to the open innovation needs of the Corporation. They are connected to other industries and better connected to the market, and may be more likely to recognize ways to adapt their inventions for better success.
The extreme of tortoise innovator may well be the large body of government scientists that conducted high-tech R&D for decades in the old Soviet Union. One of my past open innovation activities at Innovationedge included traveling to Moscow to assist Russia (more specifically, ISTC: http://www.istc.ru/) in finding external partners for the huge body of invention that arose from government labs in past work (this public information: e.g., I am listed as a speaker on the published agenda of a biotech meeting in Moscow with a presentation entitled “Innovationedge Partnership to bring innovation from Russia to the U.S.”). Unfortunately, much of that work in the Soviet Union, in my opinion, was dominated by deep drilling into highly isolated wells of expertise, with advanced technologies that were unconnected to real-world industry and markets. Creating connections and finding market opportunities after the fact (as in “answers in search of problems”) is much less efficient that developing inventions tailored to meet real market needs in the first place. The scientists were some of the best in the world, but they were working in isolation, often in great secrecy, with little ability to discuss their work with outsiders and obtain needed feedback and insights to make their work more useful outside their immediate focus. Looking back in time at the fruits of past Soviet era R&D to me looked like closed innovation to an extreme.
My observation of the isolation of Russian R&D relative to industry and markets is consistent with the detailed observation and analysis by Dina Williams in “Russia’s innovation system: reflection on the past, present and future” in The International Journal of Transitions and Innovation Systems, Vol. 1, No. 4, 2011, p. 394-412, available via Academia.edu at http://www.academia.edu/1207385/Russias_innovation_system_reflection_on_the_past_present_and_future (free download with registration).
Success in open innovation and even in making conventional internal innovation more successful can be enhanced when innovators “get out more often” and increase their visibility in relevant communities. Innovation is frequently about crossing boundaries and making new connections, and open innovation almost by definition involves reaching past one’s own corporate boundaries to find solutions outside. What better way to do this than by having innovators physically or virtually stepping outside those boundaries and being visible to potential partners?
One of my favorite experiences during my days at Innovationedge involved seeing a technology go from an inventor’s garage to a multinational corporation where it is now being commercialized globally. A key event in that story involved speaking at technical conference where my presentation included some information about our client’s invention. Afterwards, I was approached by an R&D leader from a significant corporation who wanted to know more. There was much more work after this—open innovation success is rarely fast and easy—but that new connection took us on a path toward success. Related stories occur frequently when innovation is shared. But silent companies who rely on their tortoise shell eventually find that solid defense is irrelevant. Sometimes, the prizes go not to those who best hide behind their fortifications but to those who cross the finish line in the race for innovation.
One of my favorite conferences dealing with the details of successful open innovation and technology transfer strategy is CoDev, the annual conference sponsored by the Management Roundtable and now chaired by Cheryl Perkins of Innovationedge. I think I’ve been there four times and it was always worthwhile and extremely helpful. I’m pleasantly surprised that CoDev is extending their scope to include a conference in Shanghai, China this year on Dec. 4-5.
CoDev Asia 2012 will offer participants new tools to accelerate R&D and new product development by forming wise alliances with outside organizations such as start-ups, larger companies, universities, and other institutions. From technology scouting to research management to partnership contracts, CoDev Asia will offer insights, resources, practical experience, and connections that can help your company retool and accelerate your innovation engines.
I was recently inspired by the vast international innovation experience of a leader from Procter and Gamble, Bert Grobben, who will be one of the speakers at the conference. I also recently heard Yan Sheng, President of Intellectual Ventures-China, speak and am impressed with what he has to share. In fact, among the other speakers at the event is a wealth of experience and information that might be helpful to you. On the other hand, I’ll also be a speaker (just a panelist, not too dangerous), so look out–but you don’t have to attend my session.
One of the highlights of the past few years for me has been the annual CoDev conference on open innovation sponsored by the Management Roundtable. Top-notch speakers on open innovation and collaboration will speak, sharing their experiences and insights. Speakers from companies like Procter and Gamble, Colgate, Pepsico, General Mills and ConocoPhilips (one of the new companies speaking this year) have much to share. It’s a great venue for networking with many thought leaders and experts. Many of the participants are executives, directors, or managers responsible for collaborative innovation and are the kind of people you ought to know if you or your company care about advancing your approach to innovation.
This year Innovationedge will be conducting a pre-conference workshop on innovation and IP strategy. I hope you’ll be there with us!
The setting is Scottsdale, Arizona, which is the place to be in January. Beautiful region! The conference runs from Jan. 24-26, 2011.
This year I’m especially excited about one of the key-note speakers, my friend Adriano Amaral from Brazil. He was one of the visionary leaders of the government in Brasilia in the past decade who transformed the economy of that state into the strongest economic engine of Brazil. He is a tremendously successful CEO of a for-profit business, POSEAD, and of a non-profit educational organization, CETEB, both of which have transformed education for speakers of Portuguese and Spanish with a remarkably successful business model. He will share some of his story, a tiny part of which I’ve shared previously on this blog. Connecting with this influential leader from Brazil could easily be worth the price of the conference for some of you.
Chemical engineers interested in innovation and entrepreneurship should consider attending the AIChE 2010 Annual Meeting in Salt Lake City. On Wednesday, Nov. 10, I will chair a session featuring four outstanding speakers on topics that should be of interest to many engineers, including university researchers, corporate researchers, and managers. If you are conducting research that could lead to a new business, if you are involved in leading or managing R&D, if you are part of an effort where intellectual property could make a difference, then you should attend our session, “Intellectual Assets in the Digital Era.” You need to register for this conference through AIChE.
Time: Wednesday, November 10, 2010: 8:30 AM-11:00 AM
Location: Salt Palace Convention Center, Grand Ballroom G, Salt Lake City, UT
Chair: Jeff Lindsay, Director of Solution Development, Innovationedge, Neenah, WI
Co-Chair: Ken Horton, Gore School of Business, Westminster College, Salt Lake City, UT
Schedule of Papers and Abstracts:
8:30 AM, Paper #406A, “Business Development, IP, and Manufacturing Success: Perspectives From Utah’s Manufacturing Extension Partnership” by David Sorensen, Executive Director of Utah’s Manufacturing Extension Program. (See biographical information below.)
Abstract: The Manufacturing Extension Partnership of Utah has assisted many companies in strengthening their strategy for success and continued growth. We will discuss what it takes to advance your business, including lessons relative to leadership, vision, intellectual property, and coping with changing regulations and policies.
9:10 AM, Paper #406b, “The Role of IP in Successful Startups,” Mike Alder, Director of Technology Transfer, Brigham Young University.
Abstract: Many AIChE members will be involved with a startup at some point in their career. While the capabilities of the management team is of utmost importance, in numerous cases, the success of the startup also depends on the quality of its intellectual property. In this era, an IP-savvy team can take several steps to secure competitive advantage and realize greater value from the technology, products, or services the company offers. This presentation will draw upon experience with many startups and startup teams and will provide guidance to researchers, business leaders, and future entrepreneurs on how to better prepare for success.
9:45 AM, Paper #406c, “An Introduction to IP Law: The Underpinnings of Intellectual Assets,” Ken Horton, Kirton & McConkie, Salt Lake City, UT
Abstract: An understanding of the basics of intellectual property law can help chemical engineers in advancing their own research, in evaluating competitive efforts, in building their own business, or in general advancing their career. This presentation will cover some of the key concepts that engineers should know, including the nature of patents, the different kinds of patents (provisional, utility, design), the role of trademarks and copyrights, what it takes to be patentable, and how changes in patent law may affect your career and business.
10:20 AM, Paper #406d, “Cost-Effective Pursuit of IP in a Down Economy,” by Jonathan Lee
Abstract: How does one get the most protection and benefit from intellectual property when the economy is down? How can patents and other forms of intellectual property be obtained in a cost effective manner when budgets are tight? In this presentation, an experienced patent attorney shares insights into cost effective IP with guidance directed to managers, research leaders, inventors, and entrepreneurs.
Mr. Sorensen has over 35 years of experience in a wide variety of technical and managerial assignments requiring comprehensive knowledge in several disciplines relating to engineering, manufacturing, information technology and business systems. He has been directly responsible for major contracts with industry and government agencies and has a proven record of technical competence, customer relations, and business planning in rapidly expanding technical companies. Mr. Sorensen has held increasingly responsible positions in product and service organizations. He is innovative, resourceful, and aggressive in accomplishing assigned responsibilities with major strengths in strategic planning, marketing and management. He holds a Bachelor of Engineering Science and a Masters in Manufacturing Engineering Technology from Brigham Young University.
Since 1995 he’s been the Director of the Utah Manufacturing Extension Partnership (MEP-Utah), serving primarily the 6,200 manufacturers in the state of Utah. MEP-Utah was selected to initiate and manage the NIST Information Technology Network for over 60 MEP Centers nationwide. Mr. Sorensen is also a BYU adjunct faculty member and the Associate Dean of Technology, Trades and Industry at Utah Valley State College. With a staff of 18, in one year MEP-Utah helped create or save 2,719 jobs in Utah, increased manufacturing sales by more than $121 million and increased employee payroll by more than $84 million.
He’s been the Chairman & CEO for Echo Solutions, a start-up software products and services company; Executive VP of Eyring Research Institute; General Manager of EG&G Services; Director of Engineering at EG&G Idaho Inc.; Manager of Architect Engineering and Construction at Aerojet Nuclear Company and Manager of Power Generation Equipment at Bunker Ramo. He also has experience with GE’s Nuclear Instrumentation as a Senior Applications Engineer, and in engineering positions at Kennecott Copper, Intermountain Industries, and F.C. Torkelson Engineers.
Mike is Director of Technology Transfer at Brigham Young University, where his work has been nationally recognized by BusinessWeek and others for their success. Mike is also Chair of the Board for WestCAMP Inc. where he has also chaired the National Centers of Excellence (NCOE), a division of WestCAMP. Mike is formerly the CEO of the Biotechnology Association of Alabama. He was also a Venture Partner with Redmont Venture Partners, Inc. He has been heavily involved in the founding of Tranzyme, Inc.; Vaxin, Inc.; Folia, Inc.; Chlorogen, Inc.; Allvivo, Inc. and Cr3, Inc. All but one of these are biotechnology companies (Folia produces specialty biopolymers).
Mr. Alder has 30 years of experience in leading technology-based startup companies. He was previously CEO of Emerging Technology Partners in Birmingham, Alabama from 1997 to 2003. Prior to coming to Alabama in 1994 he co-founded the Grow Utah Fund that focused on creating technology-based businesses. In 1989 he was asked by the Utah Governor to head the State’s Office of Technology Development, which he did for 5 years as its Executive Director, helping bring Utah’s Centers of Excellence programs to national prominence. In 1973 he founded NPI, a plant biotechnology company in Salt Lake City, Utah and served as President, COO and Vice Chairman of that company for 15 years as it grew to over 700 employees.
Ken Horton is a member of Kirton & McConkie‘s Intellectual Property Practice Section in Salt Lake City. His practice includes domestic and foreign patent prosecution, patent opinions, intellectual property litigation (including both state and federal court actions), domestic and foreign trademark prosecution, trademark opinions, copyrights, trade secrets, intellectual property evaluations and due diligence, as well as technology and intellectual property agreements. Mr. Horton has extensive experience in both pharmaceutical and semiconductor technologies. He is a frequent speaker on the topic of intellectual property law and strategy, speaking both at the 2007 and 2010 A.I.C.H.E. annual conferences and the 2009 A.C.S. annual conference. Additionally, Mr. Horton is an Associate Professor in these topics in the MBA Technology Management Program at the Gore School of Business of Westminster College.
Jonathan Lee is a registered patent attorney and a member of the Utah State Bar practicing at ALG (AdvantEdge Law Group). His practice focuses on adding real-world value to companies, both large and small, by acquiring, securing, and protecting intellectual property rights.
Mr. Lee has prepared and successfully prosecuted hundreds of patent applications throughout his career, primarily in the electrical, electro-mechanical, and computer engineering fields. He currently helps a number of Fortune 1000 companies manage and develop their domestic and worldwide patent portfolios. He also regularly counsels clients in other aspects of intellectual property law, including litigation, licensing, and opinion work, as well as due diligence examinations, copyrights and trademarks, and patent reexamination proceedings.
Prior to joining ALG, Mr. Lee worked for nationally recognized law firms in Washington, D.C. and Salt Lake City, Utah.
Mr. Lee was recently selected as a Mountain States Rising Star by Super Lawyers, a peer-reviewed publication.
In May 2010 I was invited to speak at a conference of WTA (the Wisconsin Telecommunications Association) about innovation lessons for the telecommunications industry from our recently published book, Conquering Innovation Fatigue (John Wiley & Sons, 2009). Here is a condensed version of the presentation. I’ll do another Pixetell soon with some additional content.
Can’t help mentioning this: I had a technical problem with the above Pixetell and sent an email to their tech support team. I had a response within minutes. In fact, I had a phone call – the kind that takes real people using real time – and the quickly helped me troubleshoot the problem and get this post working. Wow! Miracles still happen–or at least great customer service. Love Pixetell. Great way to turn PowerPoints or whatever you have on a computer plus your voice into a recorded presentation that you can share with a URL, embed into a blog, or save as a movie. Pixetell is a product of Ontier, Inc.
In my ongoing work on analyzing the intellectual property landscape in biofuels, one of the most impressive companies I’ve run across is Amyris, a renewable products company whose clever use of synthetic biology goes far beyond biofuels. Amyris was founded by Kinkead Reiling, Neil Renninger, and Jack D. Newman who met at Berkeley and founded Amyris in 2003, headquartered in Emeryville, California. With a grant from the Bill & Melinda Gates Foundation, they first developed their technology under a non-profit initiative to provide a reliable and affordable source of artemisinin, an anti-malarial therapeutic. It was viewed as a long-shot, but they found success that paved the way for the growth of the company into other areas. They are now developing new microbial strains that can produce other useful molecules from renewable feedstocks. This industrial synthetic biology platform is providing alternatives to a broad range of petroleum-sourced products. he extremely useful molecule farnesene is an important part of their business. It provides a compound that can be used to produce flavors, perfumes, detergents, cosmetics, biodiesel, and other products.
This week Amyris created a stir by announcing a record number of deals and partnerships for a single week (a record among bioenergy companies, according to Biofuels Digest). These partnerships include P&G, Total, Soliance, Cosan, M&G Finanziaria, and Shell:
Amyris has taken it up a notch with a series of stunners surrounding its synthetic farsenene, which it has named Biofene – the first product that Amyris is seeking to produce at commercial scale.
Beyond its success this week with Biofene announcements, which are the basis for the P&G, M&G and Soliance partnerships — there are the broader arrangements with Cosan to develop a platform in renewable chemicals, and the equity agreement with Total that will provide needed capital as well as a broader platform for Amyris’s expansion into hydrocarbon fuels.
The mysterious agreement with Shell, regarding diesel, is one to watch. The decidedly vague disclosure was buried in Amyris’ amended S-1A registration statement, but not otherwise mentioned in a flurry of press releases from the company as it promotes its expansion in this pre-IPO environment. Shell Western Trading & Supply is one of 17 Shell trading companies that buy and sell to customers within and outside of Shell.
This news shows an interesting example of companies forming partnerships with an innovative start-up with great technology and apparently highly valuable IP. According to my Patbase search, Amyris has 21 patent families, quite a large number for such a young company. They clearly have been active and aggressive in pursuing patent protection, and those patents are critical for the meaningful partnerships they are now forming. It’s a great unfolding story of open innovation and technology transfer.
The story extends beyond the US. They have operations in Brazil, for example, which is one of the world’s hotbeds for bioenergy, bioproducts, and collaborative innovation.
Further information comes from today’s article, “Amyris: farnesene and the pursuit of value, valuations, validation and vroom,” also from Biofuels Digest.
Appleton Papers invented carbonless copy paper about 50 years ago. Their chemists found a way to place a clear liquid inside tiny fragile spheres that could be coated onto one side of a paper. When the spheres were broken by the force of a pen or pencil pressing down on the paper, the liquid would be released and could then react with a chemical in an adjacent layer of paper to form a dye. The newly formed dye in a lower layer of paper creates a copy of what was written on a top layer. Over the years Appleton Papers developed many improvements in the microencapsulation process, but remained focused on creating paper products such as many variations of carbonless paper or thermal paper that develops images when exposed to heat. Their encapsulation systems were brilliant but huge potential was being missed. Only when a team of outside consultants came in to review the opportunities of Appleton’s technology did the company begin to realize just how many new product opportunities might be possible. Outside eyes were needed because those inside the company had grown up with blinders in place that governed the assumptions they brought to the innovation table. Opportunities were framed in terms of what improvements could be made to their paper business, not what new products in other industries could be enabled or enriched with microencapsulation technology. The outside eyes helped Appleton know where to swing, and goodies were soon falling from the innovation piñata after swinging in the direction of Procter and Gamble.
Procter, of course, is famous for its laundry products such as Tide® detergent and Downy® fabric softener. There was a need for controlled release of fragrance from fabric softener that Appleton Papers was able to meet for P&G. By encapsulating fragrance and delivering those microcapsules to clothing, the fragrance could be protected and released gradually as capsules are broken while the clothing is being worn. Sustained released of the aroma made clothes smell fresher longer. Now Appleton encapsulated huge tankloads of aroma for the Downy business, showing the power of open innovation as technologies are applied across disciplines and shared between corporations. Steve said that Appleton had that technology for 50 years, but only recently realized its innovation potential in areas outside of paper, thanks to a secret weapon for those swinging at the innovation piñata: outside eyes.
In late 2009, I was invited to speak at Singapore’s Innovation and Enterprise Week 2009, an event held at Biopolis and sponsored by A*STAR, the world-class research organization of the Singaporean government, in collaboration with Exploit Technologies, the tech transfer arm of A*STAR. While I enjoyed the opportunity to discuss our book, the important thing to me was the opportunity to learn more about that amazing country and their bold approach to promoting innovation and technology. In my presentation for the large crowd at Innovation and Enterprise Week, I discussed the fascinating parallels between the Singapore experiment and the evolving experiment in innovation in my state of Wisconsin, where the Wisconsin Institutes for Discovery represent a brilliant approach to combining the best of public and private innovation.
Below are three video segments from my presentation. A couple of friends in Singapore took the video. There are a few gaps in sound and so forth, but I hope you can understand it. Don’t miss my lame magic trick in segment 3. They seemed to like it–proof again of the great courtesy that one finds in Singapore. In all seriousness, I think there are important lessons about innovation that can be gleaned by inspecting both the Singaporean system and the Wisconsin Institutes for Discovery, which include the Morgridge Institute for private sector research and the public Wisconsin Institute for Discovery. Madison and Singapore are on opposite sides of the world, but on the same side of the innovation spectrum, at the leading edge.
Update: On April 24, I posted a newly recorded and shortened Pixetell presentation covering the basic information I shared in Singapore, without the magic or other excursions.
I am deeply grateful to the many people who kindly shared their time to help me prepare for the presentation, including Sangtae Kim, John Wiley, Charles Hoslett, Carl Gulbrandsen and Janet Kelly from the Wisconsin side (Wisconsin Institutes for Discovery and WARF), plus Boon Swan Foo, Seito Wei Peng, and Sze Tiam Lin at Exploit Technologies in Singapore.
A survey of patents and innovation trends generally shows that collaboration is increasingly important in innovation. There are still lone experts with deep expertise that can be drilled repeatedly for valuable discoveries and innovations, but the future of innovation is increasingly in areas that transcend single disciplines and involve expertise across multiple domains. The future of innovation, in my opinion, will increasingly be found in multidisciplinary collaboration, often catalyzed by lead inventors or visionaries with “good enough” expertise in multiple areas who can bridge gaps, make connections, and recognize opportunities. This is part of the message of Conquering Innovation Fatigue, especially in the sections on multidisciplinary innovators and “Da Vinci in the Boardroom.”
I am intrigued by innovators who develop skills in multiple seemingly disconnected areas and then draw upon their multifaceted expertise to find new levels of innovation success. These “multivators™” may be a big part of the yeast the raises the dough of our future economy. They can be difficult to manage, however, and may seem like sufferers of ADHD to many observers. Understanding their potential, their employment needs, and their ability to drive innovation if properly motivated–or properly “multivated™”–may be essential for successful corporate and university innovation in the future, and is a topic am I currently exploring in depth.
If you are such an individual or know someone’s story that we should consider in future writings, please let me know!