Corporate Innovation Assets — Ecosystem Strategic Partnerships
This is a template of how we benchmark corporations. The key corporate innovation assets are; CVC, Startup Engagement channels, Venture Building & Intrapreneurship, Ecosystem strategic partnerships, and Collaborative R&D.
Previously, we discussed venture building and intrapreneurship asset management best practices (BASF Chemovater — Intrapreneurship -Corporate Innovation Assets Case ).
Now let's go into the why and the how of Ecosystem strategic partnerships.
Corporate Ecosystem Partnerships: The strategy of acquiring new products, services, and business models by conducting joint innovation processes with external innovation stakeholders.
Why build Ecosystem Strategic Partnerships?
Corporate ecosystems consist of two major strategic partner types.
— Other corporations in the value chain ( customers, suppliers, co-creators, future benefactors)
— Startups, R&D firms, technoparks, research centers, academia, corporate accelerators ( Tech solution curators)
The strategic partnerships are a vital part of customer-oriented innovation and R&D strategy. Rather than coming up with new products/services as a result of introverted R&D and innovation activities(high risk), entrepreneurial culture supplies an agile and smarter option.
A- Define the problem of your customer (ideate)
B- Build MVPs with stakeholders to solve the problem (prototype)
C- Problem solution fit assessment with your customer (test)
D- If the test fails go back to the loop if the problem-solution fit is found, scale together
The strategic partnerships lower the risks of introverted R&D and corporate innovation because the problem owner ( corporate customer) is strategically positioned at the core of the new product/service loop.
Besides lowering the risk, the agile method allows new iterative chances to address the customer problem. Since the customer is in a transparent innovation loop, every iteration is actually an intelligence gain for all stakeholders.
Startups, R&D firms, technoparks, research centers, academia, and corporate accelerators are catalyzers when two companies form a strategic partnership. The catalyzers often help new IPs, patents, or business models emerge as well as smart applications. Some models even enable companies to embed their value offers within these smaller tech solution providers.
So in the end the corporation now only saves on time, money, and risk; but also develops new capabilities by adding new partners to their ecosystem. The expansion of the innovative and technology capabilities will be beneficial to tackling, future & unforeseeable problems of the VUCA world.
How do Ecosystem Strategic Partnerships work?
- Chemical Leasing — Circular Business Model Approach
Case: Delta Electrical Equipment (DEA), faced various losses and high costs, mainly due to high amounts of waste and inefficient operational management. The knowledge of workers on chemicals and risk management was very limited, which also affected the overall performance of the company. The scope of the chemical leasing model applied to the process of washing machine painting includes surface treatment, electro-deposition, and electrostatic powder coating with partners Akzo Nobel Egypt and Chemetall.
• Reduced consumption of chemicals for pre-treatment chemicals by 15–20 per cent and for powder coating by 50 per cent
• Reduction of the total cost per washing machine by 15–20 per cent
• Percentage of reworks and rejects reduced to 1.5 per cent
• Losses reduced to 1 per cent
• Elimination of sludge waste by using environmentally friendly pre-treatment process (e.g. non-cyanide and nickel-free phosphating technologies)
• Reduction of fine powder waste from 10–5 per cent
• Reuse of waste water
• Recycling of waste
• Compliance with REACH (Registration, Evaluation, Authorisation and Restriction of Chemicals)
The chemical leasing methodology is already successfully adopted in the following industries. Electronic equipment Car manufacture, food processing equipment, and cleaning, steel treatment, Mineral water production, Wastewater treatment, Textile industry — pre-treatment and finishing, Brewery, Petrochemical industry, and Printing Industries.
- Corporate Innovation Hubs
Turkish textile, Machinery, Iron-Steel, or electronic exporters need to cut down on their carbon emissions to improve trade with EU countries. So who will bring the solution to these industries?
Years of introvert R&D?
Kind of too late for that.
How about buying a one size fits all solution?
Innovation to become mainstream will take time, till then companies will require tailor-made solutions.
The easiest approach is the more entrepreneurial one, onboard different stakeholders early and iterate.
Corporate innovation centers such as Workinlot, Plug and Play, Bluechem provide corporate innovation services for companies in different verticals. The portfolio of companies in different verticals demands a variety of solution/technology clusters be assessed.
Just like demand, supply in tech is very dynamic. The supply of solutions/technology changes at a rapid pace.
So the innovation hub flow is:
Define the innovation needs of the company, scout the relevant startup clusters, assess the cluster, and co-create with the right startup.
These collaborative approaches yield innovation in terms of business models, products/services as well as patents.
We are not saying the Ecosystem Strategic Partnerships are easy.
On the contrary, this is the most mature level of a corporate innovation asset.
This requires an innovation culture to be part of the company culture.
So, another role of the corporate innovation hubs like us is to ease the cultural transition.
Atilla Erel & Baran Korkut — — — — July 2022