Yesterday I watched a panel discuss the value of open innovation. It was interesting to see Alpheus Bingham, the Founder of InnoCentive, speak on this topic. One thing he said caught my attention and imagination–that the value of any type of open innovation system is intrinsically linked to the mechanism you use to sift through and value the ideas. If the process has no way to weigh individual ideas, you’re in danger of having too much chaff and no way to find the wheat.
In his talk, Bingham mentioned how InnoCentive was able to effectively leverage open innovation to help NASA solve a challenge they had been struggling with for 30 years. InnoCentive can increase the order of magnitude of ideas coming from within the company. In some cases, this may translate to a more effective solution, but in other cases maybe not. He mentioned that InnoCentive offered its technology platform to British Petroleum (BP) to solicit solutions for the recent Gulf oil spill crisis, but BP was too overwhelmed with the volume of ideas they were already receiving. Given the sheer volume of ideas, BP didn’t think it would be possible to properly value them all in a way that would streamline the problem solving process.
The analogy of separating the wheat from the chaff resonated with me because we in academic patenting and licensing are faced with a similar challenge. We are working with a multitude of ideas and inventions. With limited resources our ability to operate successfully rests on how well we can focus efforts on technologies that have the best chance of making it to the market and helping patients. But how to vet those ideas at the early stage always poses an interesting problem.
I would someday like to learn more about the mechanisms InnoCentive uses to value these ideas. Is anything borrowed from venture capital due diligence? How does one adequately vet ideas in a short period of time when they’re in the order of magnitude of hundreds of thousands? Can algorithms effectively aid in this process? Are good ideas overlooked when you choose a particular system for valuing the ideas?
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