Opinions expressed by Entrepreneur Contributors are their own.
You’re reading Entrepreneur India, an international franchise of Entrepreneur Media.
Perhaps one of the greatest revelations amid the pandemic is that when it comes to innovation, no entity or individual can truly go it alone. Strategic alliances are fundamental to building a well-executed innovation model that disrupts the status quo in the ecosystem. COVID-19 also showcases how technology is transforming established corporates, propelling nimble startups to pivot and spurring academia to adapt to change in such complex and unpredictable times.
It is my belief that impactful innovation can be achieved only if ecosystem stakeholders play to each other’s strengths and remain flexible while building their long-term competitive advantage. For example, The Microsoft Partner Ecosystem aims to collaborate with multiple partners to provide innovative solutions to specific challenges. The tech behemoth collaborates with device partners and independent software vendors, among others, to mutually seize new opportunities and provide partners access to resources to scale their businesses. In the era of the pandemic, Microsoft’s partner program addresses the needs of consumers who are working and learning remotely.
This is just one illustration of how key players in an ecosystem can mutually reap the benefits of a collaborative approach to innovation. Partnerships can take several forms, such as startup-corporate; academia-startup; corporate-government, venture capitalist-startup, corporate-corporate and so on.
Choosing the right innovation partner
In my view, it’s important to be aware of the type of innovation leaders seek to pursue. This decision is directly linked to identifying the right innovation partner in the rapidly evolving business climate. Since innovation cannot exist in silos, we see a widespread trend towards forging external partnerships for reasons such as boosting a company’s R&D efforts. This is primarily true for large corporates as their external partnerships are also driven by the need to explore avenues for venture capital investments. They partner with startups to access new technology and stay on top of the innovation game. Startups seek corporate partners for funding, access to new markets and resources, and onboarding new customers.
A holistic approach to collaborations is fundamental to creating a ‘one ecosystem’.
Creating pathways for innovation partnerships
According to an in-depth multi-year study on The Eight Essentials of Innovation, the business of innovation is definitely fraught with risk. Organizations should strive to handle risks rather than eliminate them from their growth strategy. Business leaders must identify pockets of opportunities that are certain to achieve financial growth objectives. Partnership models to promote innovation should not be ad hoc and poorly coordinated. If innovation has to be consistent, ecosystem stakeholders should recognize the value innovation management brings to implementing a robust exchange of new ideas among stakeholders.
I would urge innovation leaders to tread carefully when forging alliances with foreign collaborators. The international ecosystem is complex to navigate and stakeholders would need to overcome hurdles in the areas of cultural, legal and institutional differences. The digital era demands consistent innovation efforts across the corporate, startup and government landscape. This implies that the days of incremental innovation are behind us. Therefore, stakeholders should usher in best practices in collaborative innovation by improving the infrastructure landscape across geographies and driving public-private partnerships.
Crucially, innovation-focused partnerships require adequate preparation and a deep understanding of the regulatory landscape. Stakeholders should also be prepared to change their mindset to explore unique partnership models that will enable them to reinvent their business, if the need arises. For example, automobile major Ford Motor Company, self-driving technology startup Argo AI and retail giant Walmart have partnered to launch an autonomous vehicle delivery service at scale across urban markets in America. The collaboration draws on the existing strengths and capabilities of the individual entities.
Organizations seeking to become pioneers in game-changing innovation must foster a culture that encourages early planning and ideation. They should have strategic clarity on the value they want to derive from these partnerships. Thus, leaders must evaluate their strategic partnership decisions to consider whether it will catapult them to the next frontier of innovation or hold them back. Slow processes within corporates, red-tapism in the government machinery or hurried decisions implemented by ‘impatient to grow’ startups are some of the reasons that could impede the pace of innovation.
Thus, the entire ecosystem must work together as one to make the processes more efficient. Stakeholders must develop a winning mindset to form a successful innovation partnership. If innovation through cross-functional collaboration has to thrive, potential partners must continuously refine ideas and support each other’s innovation goals.