Change is a constant. New technologies surface regularly and change existing product landscapes and business models. Companies don’t have all knowledge and all technology expertise ready to be used and implemented in products. Leverage ecosystem to fill their expertise gap has become a competitive advantage. Technology scouting and innovation scouting are approaches companies use to navigate today’s fast-paced innovative environment and tackle the issue of integrating new know–how into products.
What is Innovation Scouting?
Innovation scouting is a combination of open innovation and technology scouting. As outside resources are not in control of one’s company, a suitable method has to be used to identify and keep track of these assets.
Technology scouting serves to identify relevant technologies, compile necessary information and channel it back into the company. It can support the acquisition process of relevant technological assets in the process of internalizing the missing pieces and complement the IP portfolio. Relevant changes in the environment can be identified and new opportunities for collaboration, partnerships or licensing can be pursuit.
Open innovation is an innovation strategy that recognises the limits to your own capacity to do research, to invent and develop new products. It allows and encourages ideas, technologies, and innovations to transcend company boundaries, thus increasing speed of access to relevant information. Many resources – both internal and external – are considered in this approach to drive innovative activity.
Innovation scouting broadens the scope of technology scouting to extend beyond technology centric point of view. Ideas, marketing trends and know-how sourcing can also be considered valid targets and results. By not only looking at technological assets, but ideas, people, and networks, it serves and supports shifts in core business and provide impulses to business units. In short, innovation scouting is the extension of technology scouting to fit in the open innovation strategy.
Why engage in innovation scouting?
A company’s internal innovative capacity leverages the status quo. Engineers rely on existing and known technologies and associated know-how. However, if you rely on the status quo, you are bound to miss disruptive shifts and developments. For this reason, you need to be vigilant and observe developments, trends, ideas, and innovations outside your company and industry. You cannot have the same business forever.
Many aspects can drive you to implement or improve existing innovation scouting processes:
Globalization forces us to watch and monitor trends and developments at a global level. An integrated approach to aggregate relevant information and screen it is mandatory to understand trends and emerging technologies globally.
The diffusion of new technologies from one product segment into another can upend existing power balances and catch unprepared companies by surprise. Recently, German car manufacturers have noticed they have to build up IT and software competencies to compete with Tesla.
The increasing speed of innovation and thus shortening of product lifecycles can erode competitive advantages quickly.
R&D departments have to face these challenges and take on more and more responsibilities while defending budgets. Building up internal resources to embrace opportunities presented by new ideas and technologies puts additional stress on capacities and cannibalizes core R&D activity.
On the other hand, management can take advantage of the innovation ecosystem if embedded correctly:
By staying on top of developments and keeping tabs on potentially disruptive technologies, companies can increase resilience and innovate its product portfolio.
Understanding and using the innovation ecosystem improves alignment of services, products, and business models to market needs. Regularly identifying changes, assessing their relevance and impact enables good innovation management and increased value delivery to customers.
Proper understanding of trends, technologies, and fast access to linked know-how expedites product and service development and reduces your time to market.
Existing edges on your competition are preliminary. Being great at innovation scouting, however, can be a reliable competitive advantage. If you have your organization fine-tuned to develop products with a great market fit by leveraging your ecosystem to find and allow ideas, concepts to cross-pollinate into your products and services, you set your company up for success.
How to engage in innovation scouting?
Looking at the scope of innovation scouting, you have a multitude of different aspects to connect and integrate into your innovation workflows. Therefore, the first question should be, do you want this task done by internal employees or external consultants. Both options have upsides and downsides.
Internalizing offers complete control and keeps know-how strictly inside the company. However, if people are rarely tasked with scouting activities, they cannot become efficient and cannot create the necessary network to utilize on consecutive studies. Technology and innovation scouts have to be proficient networkers, result-oriented and follow a structured approach.
Externalizing allows you to task specialized consultancies and scouts with expertise in the field of interest who can leverage their pre-existing network to deliver results. Externals can provide an unbiased, neutral perspective which can provide vital impulses to your innovation activity.
Regardless of internalizing or externalizing: Anybody involved in scouting activities is confronted with a sea of information, many options in following innovation leads and will need a structured approach to navigate this area as well as suitable software tools to combat information overload. Which data sources are relevant and should be analysed? How to analyse data from different sources? What are the interesting technologies and solutions for your topic of interest? Who are active players, academics or start-ups or key opinion leaders in any emerging technology? Where is the R&D being done? What are the most prevalent technical concepts? These are just a couple of questions that require answering in the face of fractured and most likely incomplete information.
Innovation scouting process
Innovation scouting can be separated into multiple phases. Overall, the phases are consecutive. It can be necessary to run phases multiple times, considering new information. Every phase can consist of multiple steps or modules. As a service, the innovation scouting process is flexible and not set in stone. Not all steps are necessary: It depends on the topic, your prerequisites, your know-how, and your network. But every step that is necessary has to be handled carefully to deliver quality results.
A variety of methods and tools can be incorporated to sufficiently satisfy the requirements of your scouting project. As discussed, it is possible to internalize the whole project. In case your employees lack experience and know-how, e.g. with regard to patent searching, or outside unbiased impulses to your innovation activity might be desirable, you might consider outsourcing specific parts or the entire project to specialized external consultancies. In the last case, the proper specification and listing of your requirements and expected, actionable outcomes have to be clarified and communicated.
Below is a shortlist of studies that can be incorporated into scouting missions and can inspire your project.
Innovation scouting process
Leverage technical information in order to anticipate the market and pinpoint weak signals, market shift and emerging solutions. We identify relevant mega and micro trends, interpret them and reveal their potential. Stay on the cutting edge!
Competitive intelligence
Monitor the development of market players working on similar projects or entering your competitive space. We compare strategies, grade companies and rank your organization to reveal ways to make improvements.
Start-ups sourcing
Obtain the profile of the latest start-ups in your domain to be the first to seize opportunities. Thanks to our feature Startup Radar, we provide a 360° analysis of a start-up. This helps you understand who is the funder, how are the intellectual property risks managed, what is their business model and what part of their technology is disruptive. The perfect tool for every venture capitalists and investors.
Technology and competency mapping
Develop a comprehensive, state-of-the-art technological analysis for a pre-defined field of innovation. The mapping project will help the client understand the latest trends and position their project/company correctly. Cross-analysis of patent and NPL data, as well as web info and expert interviews.
Technology and partners scouting
Identify technologies, patents, companies worthy of acquisition, R&D partners and experts to accelerate development phases and enable companies to position and secure access to new markets.
Generate and secure new ideas for technological applications by leading challenges and using design or problem-solving theories.
Ideation and white space analysis
Innovation scouting enlarges the scope of technology scouting beyond internal to external resources, which is part of an open innovation strategy. It considers not only technologies but includes ideas, networks, and partners in an innovation ecosystem. It can foster collaboration among companies, competitors, start-ups or researchers.
If innovative activity relies on internal know-how, you are bound to miss disruptive shifts in your ecosystem. To preserve your business it is necessary to observe developments, trends, ideas, and innovations outside your business and technological sector. Innovation scouting is a great method to bridge the divide.