Oftentimes, companies come up with greater and brighter business ideas and innovative solutions when they come in contact with external people.
No wonder Bill Joy observed that “there are always more smart people outside your company than within.”
A company never survives alone or in isolation…it needs to derive and analyze values that are prominent in the marketplace amongst the competitors and the target audience. Identifying, finding, and creating new opportunities require the companies to understand and evaluate what’s happening in the outside world.
What is an Innovation Ecosystem?
An innovation ecosystem can be defined as an environmental framework that includes external institutions like startup accelerators, government bodies, corporations, universities, business partners, vendors, foundations, entrepreneurs, innovation labs, venture capitalists, investors, mentors, and media. Each of them plays a unique and important role in shaping the market demands, building/moulding public opinion, introducing new technologies, shifting customer experiences and vendor expectations, transforming ideas into reality, and making financial investments.
Players in this innovation ecosystem tend to collaborate with each other to exchange ideas, opportunities, and affiliations for mutual benefits. Players of the innovation ecosystem support and help each other through collaborations in the form of business networking, campus interviews with educational institutes, SME events, trade-shows, exhibitions, conferences, cross-promotional activities, business mergers, partnerships, sharing of resources, interviews, and discussions, and so on.
How do companies benefit from an innovation ecosystem?
Modern organizations are realizing the fact that in a contemporary business scenario, value-creation and decision-making cannot always operate in a centralized manner. The same applies to innovation. It is important to accept that business leaders cannot always be an exclusive source of winning ideas and game-changing concepts. Rather they need to concentrate on being an active part of a powerful ecosystem that will encourage a consistent flow of innovative ideas and cutting-edge solutions.
This requires the company to explore new business possibilities, experiment with unique ideas, and work with external alliances. This is where the importance of the innovation ecosystem comes to the forefront.
When a company confronts challenges such as achieving sustainable innovation, capturing new markets, or driving incremental business growth – adopting and evaluating breakthrough technologies and new business models become necessary. To make informed decisions under these circumstances, companies need to stay aware and on top of key technological shifts, latest market innovations, customers’ expectations, business requirements, and security concerns. This too highlights the significance of an innovation ecosystem as the players tend to collaborate and exchange valuable ideas, insights, and information with associated companies on the grounds of cordiality.
How can a company make the most of an innovation ecosystem?
Building an internal innovation ecosystem: Companies can initiate to build an internal innovation ecosystem (or a strategic process) with specific teams and employees representing every department. The internal innovation team will brainstorm unique ideas around capturing new customers, exploring new markets, increasing investments on promising projects, tracking progress through key metrics, and analyzing customers’ willingness to pay. The one thing that leaders need to bear in mind is that not all projects/investments will lead to success; some might as well fail. But innovation needs experimentation and taking certain risks.
Examine the nature of the innovation and your present scenario
The first step that companies can take is to audit and examine the key factors that are influencing/introducing innovation in your sector or domain. Understand the new ideas that are sprouting and their original sources, analyze the industries wherein they can be applied, and learn about the organizations who are supporting or adopting them. Finally, evaluate how these new ideas/concepts can impact your current business landscape and what factors of your business need to be altered to embrace these new ideas.
Understand the kind of players who can influence your business
The innovation ecosystem involves a lot of players that we previously spoke about in the blog. A company needs to identify the core players/partners who can be collaborated with, on the basis of mutual advantages and exchange of relevant and unique business proposals. At the same time, it is also important to consider the roles played by local, state, and federal entities in developing the ecosystem, which makes it crucial for the companies to understand their needs and goals to build amicable partnerships with them.
Observe how other players are operating in an innovation ecosystem
Remember that the players in an innovation ecosystem are rarely competitive with each other. It operates like a supportive and collaborative community that believes in helping each other to grow, learn and share profits. Ideally, in an innovation ecosystem, there’s plenty of pie for everyone and on top of that, organizations get a scope to learn from the successes and failures of each other. This brings the much-needed business acumen to the table. Hence, it is important to sometimes observe closely how the ideas/trends are doing in the market, who are adopting them and how they are turning out to be.
The ecosystem approach to exploring innovation, at both internal and external levels, can lead to a competitive, dynamic and progressive business environment. This can fuel a sustainable growth engine, which creates the right conditions to pick up the best ideas.
Sonali has an extensive experience in content writing, marketing, and strategy and she has worked with companies where she was involved in the 360-degree content production and editing. An avid reader and animal lover, she loves to cook, take care of her plants and travel.
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