Somewhat Longer than a Tweet

If you want to know what I’m doing right now, check my Twitter at www.twitter.com/jwolpert.  But if you want to know what I’ve been doing for the past 20 years, read on.

I had to write an abstract last week for a talk I’m giving in June, and it pretty well sums up the unsolvable problem to which I have – for better or worse – dedicated my career.  It’s slightly too long for Twitter, but it is still “me in a nutshell.”

Shared Secrets:

Managing Collaborative Business Innovation

Today’s dual imperatives for business model change and external collaboration have leaders seeking better ways to share their business intentions without tipping their hand.

The speaker, John Wolpert, has conducted extensive research and fieldwork in the US, Australia, and Europe to address the problem of finding capabilities, resources, and know-how bound-up inside legally separate entities (corporations, universities, government research institutes) that can lead to important innovations if combined, while avoiding the exposure of information that should not be shared openly with outside parties.

Most leaders today, particularly since the beginning of the current global economic crisis, expect that changing conditions will force them to develop fundamentally new business models.  Further, they believe that working collaboratively on business model innovation with outside entities will be crucial to their success.  However, this presents several problems:

1. The most powerful combinations may be between two or more companies who have no knowledge of each other or who have no reason to suspect that they should be working together.
2. Identifying opportunities for collaboration requires knowledge on both sides about the others’ capabilities, resources and know-how.  But unlike with straightforward supply chain or joint venture development – where the subject domain is well-known and contracts can be written to isolate what information is to be shared – collaborative innovation requires a more fluid, exploratory approach.  This can present a significant risk of exposing information that should have remained secret.
3. If the only information required in finding promising connections between companies were inventions (which the speaker calls the “nouns” of innovation), then the patent system presents one way to share.  However, fieldwork in Australia between 2003 and 2007 conclusively showed that the most crucial information was not inventions but rather the respective parties’ intentions.  (The speaker elaborates a detailed framework for finding and analyzing intentions, the “action-verbs” of innovation.) In fact, business model innovation is entirely constructed of human intentions rather than technical inventions.  But intentions can’t typically be protected.  They are extremely sensitive, and once shared, they are ‘free game’ for outside parties to exploit.

These issues become acute when trying to find collaborative innovation opportunities between parties in different countries, such as government institutes in the US and potential partners in Asia.

None of these issues can be solved entirely, but there are methods for addressing them and increasing the chances for connection and collaborative development that results in favorable outcomes for all parties.

The speaker will present three methods explored over the past twelve years of research at companies including IBM, Strategos, Best Buy, and a consortium of life science firms and institutes:

1. Trusted Intermediation and Arbiters of Trust
2. Joint talent development programs
3. Recent trends in micro-investment

Research methods to study these kinds of issues must focus mainly on fieldwork and business model experimentation.  A series of business experiments described in the presentation were conducted at IBM from 1996 through the present, in Australia and the UK from 2003 through 2007, and at companies such as Best Buy since early 2008.

Findings from these experiments suggest that game theory approaches such as the Byzantine General’s Problem provide a reasonable framework for addressing these problems, but that nuanced management of the resulting innovation programs is critical.  In all cases, specific methods of indirection prove to be crucial for overcoming organizational resistance and trust issues, especially in the earliest phases of discovery, where there is no obvious connection between entities based on external knowledge.