The Coronavirus crisis has sown panic and confusion by hitting business hard during the first months of this year. However, everything has a good part, and in this sense, the Covid-19 has also “almost unintentionally” promoted collaboration between companies in search of new business models and global solutions.
These models form part of the concept of Open Innovation, a way of progressing that has helped companies adapt to the difficulties posed by the indefinite interruption of activity and social distancing.
During Covid-19, the activity of companies, whether B2B or B2C, has had to focus mainly on:
It has a clear and defined development strategy, which it adapts to changes.
Open innovation is the continuous process of collaboration and exchange of information and technological resources, between internal and external agents to companies, through which, these companies find new and better solutions to the problems of users, while generating new value in traditional markets.
It is therefore a decentralized and participatory process without restrictions, always based on long-term market relationships. Furthermore, it requires the exchange of complementary skills between different companies: startups, traditional companies, large conglomerates and universities, and where the role of technology plays a leading role. The greater the creativity and effective use of talent and specialized knowledge, the better the results for the company.
Large companies such as Ferrovial, BBVA, Telefónica and Barclays have adopted solid strategies and structures for internal innovation, separated from the traditional research and development department, and supported by a strong innovation-oriented business culture, generally promoted by the establishment of a specialized innovation unit and also by the appointment of a CIO (Chief Innovation Officer) or CDO (Chief Digital Officer) to supervise the process.
On the basis of these internal strategies, companies have designed their line of action on innovation, for example, to invest in a corporate venture capital fund or to create a corporate acceleration programme. In fact, 78% of large European companies claim to have a corporate venture capital fund dedicated to investing in new startups, 64% of them invested in between 1 and 5 startups, and the remaining 6 or more, during the last year. In addition, 70% of the companies have a corporate acceleration program to give more support to startups and maintain an active commitment to them.
Finally, it is interesting to mention that the acquisition and use of technologies from outside the company is known as Inbound Innovation, and is commonly the most used method of innovation. However, innovation does not always have to come from outside, in many cases companies support internal talent by funding and mentoring intra-enterprise projects designed by employees with creative spirit that sometimes end up creating a startup.
The main benefits that companies find in open innovation are
The Coronavirus crisis has made collaboration between companies more necessary than ever, putting activity for the benefit of society before the search for commercial benefits.
The scientific community has called for companies, organizations and startups to share their data in order to improve the joint reaction to the virus and accelerate the recovery process.
In Spain, for example, the insurance company DKV, launched its telemedicine app ‘I want to take care of myself more’ free of charge to decongest hospitals allowing them to focus on the most serious cases of Coronavirus, avoiding possible new infections on the move. It also launched its ‘#NoneMajorSolo’ initiative, which provided emotional and psychological support for older people during the pandemic.
Other companies such as Samsung have collaborated with NGOs such as Save The Children to deliver some 600 tablets to enable underprivileged students to continue with the lessons at a distance. Repsol, for its part, readapted its Repsol Technology Lab centre to produce hydroalcoholic gel.
On a technological level, the collaboration between Google and the Ministry of Industry is also noteworthy, with the launch of the ‘Impulso Digital con Google’ platform to digitise SMEs and help the economic recovery, paying special attention to the Spanish tourism sector. According to data from the European Commission, only 14% of Spanish SMEs have a digitalization plan.
Moreover, in September, Google will launch from ‘Google for Startups Campus Madrid’ its ‘Growth Academy: Traveltech’, together with the UNWTO and the EMEA, to promote technology startups related to the tourism sector and train professionals in digital skills.
Thus, Google has added new features in its classic applications such as Maps and My Business, so that companies can add interesting information to the consumer, such as whether they offer food at home, or provide online classes, among others.
From the point of view of business efficiency and collaboration, one of the best and most innovative ways to break into the technological vanguard is through Hackathon events.
A Hackathon, from the combination of the words Hack and Marathon, is an event lasting one or two days, where innovative solutions are sought on one or several specific topics.
The participants, who may have different profiles, from university students in the STEM sector to leaders from different industries, work in small teams and in an environment that encourages creativity and the search for experimental solutions, through which the teams come up with new concepts, ideas and prototypes for highly innovative solutions focused on a certain sector.
The Hackathon offers multiple benefits, among which are:
Recent examples of this type of event include the Community of Madrid, where the virtual hackathon ‘#VenceAlVirus’ took place. This multidisciplinary competition was held during the Covid-19 to find technological solutions related to health, employment, the community and business.
For its part, the ESIC Business & Marketing School campus in Valencia has organized its first virtual Hackathon to help companies, students and teachers to contribute new solutions for the recovery phase after the pandemic from the point of view of Business, Society and People.
BBVA also launched its “Ninja” initiative to promote technological talent within the BBVA Group. Participants in the 15 finalist projects will work for a week with BBVA mentors to prepare the prototype and present it to a group of experts for implementation.
Línea Directa was another Spanish company that took advantage of the pandemic to promote innovation, and launched its 3rd edition of “Big Ideas”, an online Hackathon, aimed at university students with a creative and STEM profile, to think of innovative solutions for the digitalization of the insurance sector.
On an international level, the HackCorona stands out, an event in which some 300 people, within 48 hours, joined forces to present 23 proposals in total, such as the creation of a community digital currency for volunteers, or Artificial Intelligence to develop possible vaccines for the virus more quickly.
In the automotive sector, ‘KODA AUTO DigiLab organized its online hackathon ‘COVID Mobility Race’, where 52 teams from 19 countries collaborated to find digital solutions for the automotive trade. The Israeli team, Matter was chosen as the winner for its amazing 3D technology for virtual showrooms.
Open innovation is a basic requirement for the company to remain competitive and at the forefront of what is happening in each sector at the technological and operational level. Companies that do not adopt internal and external strategies focused on innovation through collaboration are destined to fail.
Despite these moments of crisis during the Covid-19, which have boosted interest in innovation and speeded up the deployment of new digitalisation and collaboration strategies, there are still certain doubts in some sectors, on issues such as patent registration or regulation and limitations on access to crucial information in certain companies, in sectors such as pharmaceuticals or IT, with issues such as access to open source, or the mass deployment of certain types of software. However, in the long term, these doubts, which are totally valid now, will mean a blockage in the natural flow in which the whole ecosystem of companies moves.
Finally, customer needs never remain the same after a crisis. It may be convenient for the entrepreneur to think so, but most of the time this is not the case. Therefore, having established new ways of generating open innovation can provide much needed flexibility and, in the end, ensure the viability of the company.