During the course of my career I have learned that innovation has to be open and collaborative. Gone are the days when companies worked behind closed doors to develop the “next big thing.” Today you need to be part of an ecosystem, to collaborate and partner with the broader community in the area of innovation relevant to your organization. That means being transparent: sharing your ideas, learnings and results with others. And it means being open to those that others share with you.
As a senior executive at two global corporations, I championed the setting up of small innovation labs and teams in order to be able to quickly and efficiently develop, prototype and test new ideas. And I insisted on them being located outside the company, preferably in a collaborative environment with startups or others working on the same topic, so we could foster collaboration and exchange with members of the broader ecosystem.
As an example, when I was Group CIO at UBS we became the first global bank to join the Level39 accelerator in London. This allowed our innovation team to work together in an open and collaborative environment with some 150 other startups, and to be full participants in an exciting innovation ecosystem.
This kind of transparency is not always easy for people to embrace, however, especially in competitive industries. I can fully understand this. But in my experience it is a hurdle I think anyone facing an innovation challenge must get over.
Here is why.
Firstly, today’s tech environment is both highly complex and very fast moving. That makes it increasingly difficult for people to innovate on their own: there is a risk that you will miss important developments.
Secondly, people increasingly recognize the value of crowd intelligence: the idea that large groups of people make better decisions, or solve problems in a better way, than individuals do. Of course, crowds can make big mistakes too. But it is no accident that, even in our highly interconnected world, industries still tend to congregate in specific locations.
The tech industry in particular has embraced open-source, collaborative approaches, and with great success. We have Silicon Valleys and Alleys among other things because technologists see a clear net positive value in rubbing shoulders, even if they are competitors. Other industries can and should learn from this.
Third, collaboration, especially between companies in different fields, fosters cross-pollination of ideas. We see this very clearly in FinTech, where banks gain insights from tech companies into what is happening with the technology while they enrich technologists with their perspective on banking and finance.
Fourth, working in a collaborative environment with potential competitors provides a natural platform for testing your ideas. Either through direct feedback or observation you will be more quickly able to judge what you are doing if you do it as part of a larger community.
Finally, and in my opinion not to be underestimated: being willing and able to do your innovation in an open way can be good for your organization’s reputation. As members of the ecosystem you can increase your credibility among potential partners or suppliers. You can also demonstrate to your clients your continuing efforts to improve. And if your company gets positively associated with an important technological trend you can increase awareness of your brand among the general public.
So while working in a vacuum may be tempting on some levels, I think it is an increasingly ineffective approach. My experience is that openness can turn good ideas into great ones, and that great ideas benefit all.
This was originally published at FinTech Pulse, my blog post featuring megatrends, digital transformation and innovation in the FinTech industry. Read more at www.oliverbussmann.com/blog and follow me on Twitter @obussmann.