NineSigma: Nurturing 'Open Innovation'

Why should a company pursue an open innovation strategy?

Here's one example of the benefits. We had a client who was selling laundry detergent in prepackaged pouches. The problem was that the plastic pellets holding the liquid detergent were leaking, staining the packaging, and so sales were tanking. The company had its packaging people working on it, the manufacturing people were working on it, the supplier of the plastic pellets was working on it, and no one could come up with a solution. Our search turned up a small, unheard-of company in Britain that was packaging agricultural concentrates—herbicides, pesticides, that kind of stuff—in a similar type of film. They had had, and solved, a similar problem along the way, and their solution could be adapted to our client's problem. So our client's solution came from a company that no one had heard of in an unrelated industry.

But if you define a problem too narrowly, do you risk limiting the very promise of the open innovation approach? How do you cast a wide net but not catch junk?

First, you need to clearly identify a client's most pressing problem or problems. Then you need to translate the problem into basic science or technology terms. So, for instance, when P&G wanted to solve the problem of wrinkled cotton, we didn't send out a request for proposals saying we were looking for a solution to wrinkling because if you describe the problem in terms of its applications, the only solutions you get are from people working in that industry. So instead we talked about surface chemistry and hydrogen-bonding across fibers—the language of science and tech that is understood across industries.