Better Partnerships for Better Innovation

More and more companies are turning to partnering to drive innovation and growth. However, all too often these efforts neglect the importance creating a partnering ecosystem and managing it profitably. In the video below, Jaideep Raje from Lux Research uses examples of innovation successes and failures to demonstrate the importance of partnering and a driven ecosystem.



Creating a healthy partnering ecosystem

The presentation by Lux Research provides key insights on the fundamental elements of a successful partnering ecosystem. According to them, successfully partnering for innovation requires the 5 components shown in the chart below. If one is missing, the effort will likely fail. For example, Nokia had the best smartphone first, but lacked ecosystem vision. The phone was a great product, but there was no ecosystem built up around it to provide interesting content. Fuel cell vehicles, on the other hand, ignored the joint probability of success, which says you’re only as strong as your weakest link. Although GM developed an ecosystem around fuel cell vehicles, a partner failed to develop key technology, causing the innovation to (temporarily) fail. In both instances, Nokia and GM were (or should have been) the alpha partner – the partner that guides the ecosystem towards success.

Convergent Innovation Alpha Partner

The alpha partner is the most important component in a partnering ecosystem, setting it apart from other types of ecosystems, as explained by the chart below. The alpha partner is the one responsible for setting the ecosystem vision, making the tough choices and pushing the ecosystem to achieve its goals. Lux Research cited Amazon as a classic example of an alpha partner, pushing the Kindle ecosystem to success. This achievement came despite the fact that Sony came out with a better eReader first. Amazon’s superior ecosystem management led them to achieve success year after year.

Normal vs Partner Driven Ecosystem


Launching a partnering ecosystem

In our experience, most organizations will have to begin working with unknown solvers in order to build out their partnering ecosystem. One effective way to find these partners is by launching an online branded portal. This portal should be capable of publishing generic innovation needs and collecting proposals from unknown solvers, which the organization can use to develop new partnerships. From these interactions, some negative, some positive, the company gains an understanding of its network and can begin forming its ecosystem. Gradually, the best partners are uncovered, enabling deeper collaboration and better innovations. To learn more about creating and developing a partnering ecosystem, read the Inova Whitepaper, The Key to Open Innovation Success: An Ecosystem of Partners.

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