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• Finding #6: Alliances are one of the ideal mechanisms for creating innovation streams between differing specialized fields, industries, and companies.
If finding #4 (Innovations are happening trans-field) and #5 (Breakthroughs require differentials in thinking) are both true, then it may certainly be true that some structures are better suited for innovation.
We looked at a variety of trans-field structures, such as collaborative networks (e.g. Linux), confederations (software development), mergers, acquisitions, and strategic alliances.
While each structure had its pros and cons, the preponderance of evidence, both academic and imperical, indicates that, if best practices are employed, Strategic Alliances were the perferred method of engaging in joint or collaborative innovation.
- Implications:
- Companies that are truly committed to Innovation will seek to form alliances with outside entities that have a very different perspective, skill set, area of specialization, and culture.
- Innovation is not just a value-added augmentation to alliances; it’s the root source of an alliance’s ability to regenerate over time
- If an alliance is to prosper and thrive in the long run, a continuous commitment to innovation is essential to enable it to adapt to the unceasing waves of value migration.
- Evidence:
- We found numerous sources of joint innovation, ranging from chemical (e.g. Dow), pharmaceutical (e.g. Lilly), high tech companies (e.g. IBM), and consumer products companies (P&G) that had great success flowing innovations from their strategic alliances.
- Perhaps the most compelling evidence came from our colleagues in the Netherlands: Guert Dysters & Ard-Pieter de Man, in conjunction with the University of Einhoven, as shown below.
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