External Innovations
The need for external innovation has been rising in recent years. Due to the ever-increasing degree of specialization of companies and the resulting outsourcing activities, corporates are forced to acquire expertise in the areas they operate. The corporates' R&D departments are increasingly under pressure to present new and innovative business ideas and technologies at shorter intervals.
The fact that the corporate's own innovation department quickly reaches its limits with such an amount of required innovative strength seems obvious. Nevertheless, in order to demonstrate the necessary innovative strength and to remain competitive, more and more companies are putting the search for solutions and innovations into the hands of others.
We call external innovations all those that were not created and developed within the company itself, but were brought in from outside. These can be developed from other companies, such as agile startups, suppliers or competitors, but also from universities and other research institutions.
There are many ways to relate to external innovations.
On the one hand, you have to differentiate between companies that are exclusively interested in the innovation of a provider - usually these are young startups. Exclusive contracts are often signed that prohibit other companies from using the same innovations.
On the other hand, there are companies that not only use external innovations for internal purposes, but also want to sell them profitably, which in turn gives them a monetary incentive to acquire them. We have summarized the importance of external Innovations and the collaborations with startups in our blog article.
A balance between these two possibilities are so-called accelerator and incubator programs, where startups apply at corporates and are supported in their growth. In return, the corporate receives startup shares and benefits from the generated know-how and from the subsequent increase in value of the individual startups.