Open innovation and technology scouting

Open innovation has grown as a topic of interest over the last few years – the phrase is broad and ambiguous enough that many people have claimed its importance for doing business in the new millennium, while at the same time drawing very different meanings from the term.

Chesborough coined the phrase ‘open innovation’, but before that, companies started collaborating with partners outside their walls and embarking on technology scouting. Have a look around your own company, whether you have a formal open innovation program or not and there will be people practicing open innovation – they just might not call it that. This is what is so powerful about Chesbrough’s concept – it is big enough to get whole companies motivated behind it, beyond just a skunkworks activity. Timeliness is the other factor behind the success of Chesborough’s concept. Large companies do not have the completeness of research capabilities required to bring genuine innovation to their markets or business problems. Technology has also played its part, with the increasing pace of technological development and the speed at which information is disseminated. So, as there are more external solutions to your business and it becomes easier to connect with them, why wouldn’t you practice open innovation?

We understand at a conceptual level that open innovation is a good thing but let’s not forget open innovation is a means to an end, not an end in itself. We have crystallised our open innovation deliverables into three areas:

Faster: Not inventing everything ourselves from scratch – by complimenting our expertise with the expertise of others, it results in faster project delivery.

Better: Access to a wider range of solutions and competencies have enabled us to deliver better solutions to the business and our consumers.

More: By collaborating with others, we have been able to achieve more than we could have with only internal resources.

Mars are on a journey from closed to open innovation. We have come an incredibly long way in a short amount of time, and we have some way to go to reach our ambition of taking open innovation principles and embedding them as a standard way of doing business across Mars Inc.

So how do you start on this journey? We can only speak from our experience, but there are some critical elements.

Firstly, be clear on the ambition and focus, and the differences between the two. The terms and definitions for open innovation are as broad as they are long, put some boundaries around it and find a definition that works within your business.

Top management commitment is key. It’s ‘change management 101’ – you need the support of business leaders and you also need to make it real and achievable for the people you want to be active in the area.

Support for individuals and teams – these are the people that are going to make open innovation a reality or not, they need tools and guidance for the ways of working to be embedded into a business. This is particularly true for how to decide on internal versus external development, and it is critical that this first step is taken consciously.

We have experienced the change that a company can go through when Chesborough’s concept is taken up by a company. Beware however, as the words ‘open innovation’ could be seen to be a fad. Open innovation is a hot topic and becoming very popular in the food industry and beyond. While the term open innovation may not be on the lips of every business thought leader and consultant in five years time, we see external collaboration as critical for the ongoing success of our business and are in it for the long term. This is why our overall programme is external innovation (therefore clearly differentiating from ‘business as usual’ internal innovation). As part of that, developing associates who have the right skills and aptitude for finding and leveraging technologies is an important step for taking open innovation from concept to reality.

Technology scouting

During the selection of internal Technology Scouts, it became clear rather quickly that a special type of person is required to do the job. Typical competencies relevant to Technology Scouts are:

• Creativity
• Innovation management
• Learning on the fly
• Perspective
• Dealing with ambiguity
• Functional and technical skills
• Customer focus
• Managing expectations

Ultimately, a combination of passion for technology, in combination with the ability to make connections between entrepreneurial sources and internal stakeholders will be the key to success for the Technology Scout.

A Technology Scout needs to be able to understand and dig for the customer’s real needs. Via discussion, the scout can help articulate and define the actual thing he or she is after. A driver’s desire like “I need a more powerful engine in my car!” could lead to the question: “so … do you want the car to be faster?” In that specific case, reduced weight and improved aerodynamics could lead to the solution and introduce benefits for fuel consumption and handling as well. Very often, if not most of the time, the articulated need does not equal the actual best solution.

Once the scout has a proper understanding of what he needs to go after, he will start using the capability of transferring technologies that are found during the investigation. Typical needs in the chocolate industry can be clustered together under a broad sustainability platform. By doing so a good landscape can be made of ‘what’s needed, where to look for it, how to transform it and how to resolve the need’.

For example – the methods of making confectionary components require typical unit operations like heating and cooking. The scout could and should be looking for cross-industrial heating techniques and the means of modifying those so that the technique becomes suitable for confectionary purposes. What he could also do is challenge the need for heating in the first place – why is the raw material heated and what is supposed to happen by doing so? This might also lead to solutions that bypass the heating step and provide benefits for the sustainability objectives.

A useful methodology in this scouting role is TRIZ. Specifically the approach of taking a system apart (virtually) and defining the cause and the manifestation of a problem can be really helpful in establishing where to work on solutions. This does not only work for engineering problems but can also work for foodstuffs and even organisational challenges. In many cases, if not all, the real challenge becomes apparent by simply writing down what ‘parts and items’ are involved and what their respective functions are. Every part of a machine, an organisation or even a chocolate filled candy-bar has a function, a simple purpose in being there.

By asking questions about every individual part of the system, or at least the location of the specific part, the options on how to resolve might become clear quickly.

These questions can differ, but could generally look like:

• Why is it there?
• Where exactly is it located?
• What should it be doing?
• How well is it performing in its targeted function?
• Can I replace it by something else without losing the function?
• What happens if I take it out?
• Do I need said function in the first place?
• What happens if I virtually minimise or maximise the presence of the item?

Looking back at the first bullet point list, one of the key challenges is management of expectations. Since many people have an opportunistic approach in their behaviour they might be keen on having all development work that could follow on from a successful scouting action done for them. This is not the role of the Technology Scout, who needs to be able to maintain a very broad focus to have maximum exposure of novel technologies on their radar screen. Proper management of expectations is important, not only for determining the workload but also to create understanding of timings; it can be really difficult to predict when a solution to a challenge can be found.

Clearly, a Technology Scout faces quite some challenges, but this is exactly what appeals so much in the scouting job – the opportunities to look for front-edge technologies and the ability to help people move forward with breakthrough technologies.

As part of the wider External Innovation programme, Mars Chocolate has decided to focus the time of several of its employees towards Technology Scouting. Mars’ approach is to focus on three key areas.

1) Strategic needs for the medium to long term

As is the case with most (if not all) FMCG companies, in order to meet our longer term corporate goals, it is clear that new technologies and new approaches will be needed as enablers. The role of the Technology Scouts will be to monitor and detect emerging techniques and science and act as a conduit to internal evaluation and potential implementation. Initially, the Scouts will be focusing on translating articulated business into unarticulated technology requirements to meet the needs of the business.

2) External technology watch

Overlapping with the first goal is the need to ‘listen in’ to key technology sectors. Various means will be employed to achieve these, including partnering with information providers, conference attendances and external research collaborations. The Scouts will be looking for opportunities, from short terms needs through to the longer goals outlined above.

3) Internal mining of information and connections

Mars Inc is a diverse range of companies with significant expertise in many science and technology disciplines. Part of the Technology Scout role will be to identify where tech transfer could add value at a specific project level. Whilst this has been happening for many years naturally as, for example, employees move between Mars businesses / corporate projects, there has not previously been resources embedded within the chocolate R&D organisation to look specifically in this area.

Overall

Fitting with the External Innovation approach of start small and grow as needed, the Technology Scouting team are in their infancy – the strategy of focusing on just a few headline activities will ensure the most efficient use of the resources available.

Typical chocolate technical needs

The chocolate industry as a whole is facing several common challenges, which can be translated into ‘scoutable’ areas. This translation process will differ from company to company and the Scout’s role is in part to turn broad corporate strategy into technical areas and specific problems that can be defined, measured and hopefully addressed. Whilst Mars’ specific strategy cannot be discussed in detail here, some generic examples are given below.

• Raw materials challenges. Availability of key chocolate raw materials e.g. milk, sugar and cocoa is a cross industry challenge. Scouts will typically be looking at alterative raw materials and new technologies to allow the use of such materials
• Cost competitiveness. Against a backdrop of increasing energy and raw materials costs, process technologies must be found that are more efficient in energy usage and waste generation, whilst maintaining the ability to produce the products consumers expect and deserve
• Nutritional balance. Manufacturers are responding to consumer trends to reformulate their existing products and change the way they design and formulate new ones. For example, this could mean the removal of artificial flavours, colours and preservatives, reducing saturated fats and adding fibres. Scouts can assist by identifying new materials, emerging trends and technical expertise required to implement changes to manufacturing assets that are necessary to accommodate alternative raw materials

About the Authors

Simon Woolford is a full time member of the external innovation team, leading open innovation initiatives and supporting its uptake in the business. Simon has a technical degree and an MBA and has been at Mars for 13 years in various roles, taking up his current role in the external innovation team at its inception in 2008.

Jasper Peters carried out a series of studies in Food Technology after which he graduated, becoming a Bac in Process Technology. At this time, he has over 10 years experience at Mars in which he spent the majority in development of technologies and processes for filled chocolate bars. His role grew recently by becoming a trained Technology Scout for Mars Inc.

Matt Hogan gained a PhD in Biochemical Engineering from University College London and is a chartered Chemical Engineer. He has worked in a variety of roles within Mars in both R&D and marketing. He is currently working in the R&D Future Technologies Group based in the UK.