Musings on Entrepreneurship and Innovation
Thursday, April 20, 2006Creation Nets
John Hagel and John Seely Brown, the authors of The Only Sustainable Edge, continue to refine and extend their thinking an article in the most recent edition of The McKinsey Quarterly titled Creation nets: Getting the most from open innovation. In it, they conclude:
The case for open innovation is clear: in today's rapidly moving world, companies can ill afford to retain outmoded closed models of innovation management. The case for creation nets as the best form of open innovation should also be clear...Yet the case for creation nets does not extend to every corporate situation and endeavor. They work best in areas with three attributes: uncertain demand for goods and services, and need for the participation of many different specialists if creation and innovation are to occur, and rapidly changing performance requirements in the marketplace. In these areas, creation nets have their most distinctive value: the ability to mobilize dispersed and diverse talent for innovation in a flexible way, whatever the scale.
Creation nets are, by their very nature, modular, which gives them great flexibility. Flexibility is valuable in the face of uncertainty. However, there are significant costs to modularity. For example, the facilitator of a creation net must work at cultivating effective interfaces among network participants in order to stimulate the convergence of shared understanding - a predicate to effective collaboration. That rarely comes easily. Consequently, creation nets add the most value when uncertainty is high.
That said, the increasing clock speed of business tends to increase uncertainty everywhere. Those who learn how to leverage emerging creation nets stand to benefit the most from our changing environment. I suspect that many existing organizations won't be able to acquire the skills necessary to learn, cultivate shared meaning, and collaborate at a sufficient pace. How does your organization stack up?
