This week I've had a tremendous series of conversations based around the power and pitfall of innovation networks. Everyone I spoke to recognise their importance but few people – myself included – understand them or know how to harness them. Let me tell three quick, and mostly personal stories, to illustrate what I mean.
The first story comes from my first job out of University, where I worked for a medium sized research and development company with an impressive history of innovation. It had (and still has) about 300 very smart people scattered across lots of small labs and offices in 6 separate buildings on a large industrial site. People generally had little idea what research was happening elsewhere in the company to any significant degree. This was in the mid-90s so the web was a mere baby compared to what it enables now.
One guy – let's call him Tony – was in his mid to late 50's and spent the majority of his time walking between the different buildings and labs chatting to people, having a coffee, enquiring about their research, and inevitably giving some useful suggestions as to what they might try next and who else within the company they should talk to. Now Tony had quite an impact on me personally and I was in no doubt whatsoever that he added tremendous value to the business in linking up disparate bits of research or science happening within the same organisation.
Now at the same time the new incoming senior management in the organisation were trying to move to a more consultancy based business model where our time was allocated to specific projects and therefore your utilisation became a key metric. Now Tony's 'utilisation' was low, partly, I suspect because he wouldn’t 'play the game' and was partially contrary by nature. Anyway I'm sorry to say that Tony was 'removed' from the organisation fairly rapidly as he couldn't immediately demonstrate his immediate value to the organisation. There may well have been other factors at play that I wasn’t aware of but I felt strongly then, as I do now, that this was a short-sighted decision made by measuring the wrong thing.
Secondly, I learned this week about two new innovations that are coming to market that we in the Connect team at Nesta had a direct hand in creating as we hosted the initial programmes where the collaborators got together and developed the initial proposition. One is a major collaboration between two multinational companies, and the other is a small licensing deal between an inventor and a bigger company. We got a tremendous buzz from hearing about both of these collaborations knowing that we had helped to make them happen.
Now the (literally) million dollar question is, what is the mechanism by which we could find efficient way take 0.1% of the value created? Interestingly – and I'm not that surprised or too bitter about this – in both cases the people involved had either partially or entirely forgotten that we had brought them together in the first place, and therefore securing that 0.1% from them is unlikely ever to work.
Anyway, like a pub landlord, I get a real kick out of knowing that people have made a connection in ‘our establishment’ and I think most 'brokers' do too because they are almost hard wired to make (often lateral) connections. A friend of mine who is a great broker can't help bring people together and doesn't particularly stick around or care what happens. I think he has, at an unconscious level a heightened perspective of influence, knowledge and power and how it flows.
My final story comes from Rory Sutherland, VP at Ogilvy who wrote a great blog post about collective action. In speaking to him about it afterwards he told me about the train station at Haywards Heath where the car park is right next to the train platform, but on the other side of the tracks. Instead of it being a short hop over to the platform from the car park, one has to walk a quarter of a mile to a bridge to get over to the station.
Now Rory’s solution was as follows. What if some or all of the 500 or so people who park regularly in Haywards Heath station each contributed a small amount of money, say £10 a year, so you could quite rapidly get the (say) £50,000 it would cost to put a bridge between the car park and the station, thereby saving commuters lots of valuable sleep and work time.
This makes almost too much sense to me but there is limited way for people to coordinate themselves to get such an initiative underway. He goes on to argue that brands may play a coordinating and underwriting role in getting such ‘public goods’ commissioned. I’m not sure about the role brands can play here but surely the tools exist right now for these ‘cashmobs’ (as opposed to flash mobs’) to come together.
Finally some of my Research and Policy colleagues at Nesta have recently done some, as yet, unpublished research into innovation networks and have developed a really useful framework for understanding them, which I’m convinced will be extremely useful.
However I’m also reminded of my quantum physics classes at University that taught me that particles exist in a sort of ‘wave of potential positions’ until observed at which point the wave collapses into a specific location. I think business or innovation networks work in a similar way. There are multiple potential collaborations, connections, marriages, divorces that exist at any one time, but they don’t stand up to too much scrutiny or measurement either. Most organisational or government attempts to support or develop networks fall flat in my experience as they are almost certainly too formal.
In a similar way pubs and clubs are places that spawn numerous relationships but you don’t measure their success based on the number of marriages, or divorces, they have initiated. Nor would the landlord expect to be invited to the big day. Rather we have a handy proxy namely income from behind the bar minus costs, which is all you really need to know about how successful the establishment is. Therefore I think we need a much more simple and/or subtle way to support, measure and understand networks.
I challenged my research colleagues asking them ‘What’s their big idea?’ (which I recognise is quite possibly not terribly helpful). All I can offer is that, when it comes to innovation I think we are looking and spending money in the wrong places. Rather than mostly investing in ideas or individuals which always distort markets, we should be investing intelligently in connecting people which create new markets. Invest in challenges not ideas and processes not events as Steve Shapiro has recently written here. The people with the power, money, or ideas, aren’t the same, so if we can spot the gaps and the connections between them then we are definitely on to something big.
I offer these stories as a starting point for a conversation and I don’t claim to have any tangible conclusions – sorry about that. In many ways I've become rather like Tony (from Story 1) myself through my work at Nesta, where we bring diverse groups of people and organisations together to see what they might create together. And ironically, I've worked with and for, lots of organisations who try to deliberately create the role of 'Network Manager/Director' with often dismal results.
I am convinced that networks are increasing in importance. Our competition or our next big opportunity can increasingly come from anywhere, so as I’ve said before we need to get much better as individuals and as organisations at building our big ideas networks as Linda Gratton from LBS calls them, and spotting what’s popping up in our peripheral vision. And, whilst the web is a tremendous tool, I still think there is no substitute for face-to-face interactions. In open innovation it’s about your perception as partner of choice and this is simply about being straight forward, decent and pleasant to work with.
Anyway, as ever I would value any feedback, conversations or suggestions. Thanks for reading to the end!