Innovation Ecosystem: Everything You Need To Know About It
To ensure your business stays innovative, you need to create an innovation ecosystem that allows innovative ideas to emerge consistently. Building such innovation ecosystem requires developing strategies for exploring new ideas, accepting failures, experimenting, and working with external partners.
In the US and other parts of the world, businesses, organizations, and institutions like capital investors and universities are looking for ways to develop innovation ecosystems or become part of those. There have been lots of deliberations on why businesses need innovation ecosystems in the past years. Nowadays the talks have shifted towards how to improve these ecosystems and make them more efficient and effective.
In this post, we will discuss everything you need to know about the innovation ecosystem.
Innovation Ecosystem Definition
The Oxford Learned dictionary defines “ecosystem” as a community of living organisms and its environment functioning as an ecological unit.
An “innovation ecosystem” is the term involving the various players, stakeholders, and community members that create innovation innovation. It includes lean startups, venture capitalists, corporations, governments, entrepreneurs, private investors, and mentors. Each plays a key role in value creation in the larger ecosystem by transforming new ideas into reality.
Just like in a typical ecosystem where living organisms support each other to survive, layers in the innovation ecosystem help each other achieve their overall goals. These collaborations occur at different levels, including cross-promotion and sharing of resources.
Working together this way allows each party to achieve their business goals, demonstrate the power of leverage and collaboration. Thus it allows creating a community that supports each other’s values, visions, and missions.
What is Innovation Ecosystem?
It is a fact that achieving any worthwhile goal depends on the ability of multiple interconnected actors to work collectively. This includes individual entrepreneurs, universities, the private sector, civil society, government, and others. The players whose collective activity produce a development outcome is called an “innovation ecosystem.”
Innovation is a way of improving the ways development goals are achieved and is not an outcome in itself. Each player needs to play their role effectively to effectively generate, develop, and scaled innovation strategies and business ideas for maximum results.
Innovation ecosystems can operate at multiple levels (e.g., national, regional, or city) and within multiple sectors (e.g., education, health, agriculture, etc.). Because of this, it can be sometimes difficult to draw boundaries around who is part of the innovation ecosystem. It is, therefore, important to focus on the sector and the problem that the innovation seeks to address.
Adopting an effective innovation ecosystem recognizes that:
- The innovation ecosystem consists of different actors, resources, and relationships who all play a role in taking innovative ideas to transformative impact at a scale.
- The effectiveness of each player within the innovation ecosystem is moderated by other parts of the system (for example, investors need to link up with good entrepreneurs who can help make a good profit out of their savings).
- A change in one aspect of the innovation ecosystem leads to significant changes in other areas of the innovation ecosystem (for instance, an increase in internet connectivity will eventually accelerate the testing and designing of new technologies).
The Importance of the Innovation Ecosystem
Innovation ecosystems create an active flow of resources and information for ideas to transform into scalable results. Through innovation ecosystems, entrepreneurs and innovators can launch and develop solutions to solve real-world problems faster. This process attracts experts from different fields in new areas, helps diversify the economy, and allows businesses to create real value for their customers. In addition, innovation ecosystems provide the platform for resource sharing and economic stability.
The value of an innovation ecosystem lies in the access to resources for the startups and the flow of information for the ecosystem’s stakeholders. This information flow creates more investment opportunities for the right people to connect with the right ideas for their businesses. Some benefits of innovation ecosystems include:
1. Innovation ecosystems focus on value creators
Innovation ecosystems focus on value creators – startups and innovators that create jobs and solve problems. They focus on identifying the best lean startups that provide deep value for funders and corporates, leading to a domino effect.
2. Effective innovation ecosystems lead to business success
Although building an effective innovation ecosystem takes time, it is worth it because it generally leads to robust business growth.
As an innovation ecosystem, when you transform the right flow of information and turn ideas into reality through support and investment, it will yield more results of increased expertise.
Google Innovation Ecosystem: Lessons To Learn
When it comes to companies at the forefront of the corporate innovation ecosystem, there’s one name that stands out: Google.
Google’s value proposition and product innovation have become so popular that we see them being baked into our online experience. But how did Google attain such enviable height?
Let’s look at how Google became Google and the lessons to learn from the google innovation ecosystem.
1. Google realizes that innovation can come from anywhere
One fundamental truth about Google’s vha innovation ecosystem is that it believes that innovation can come from anywhere, at any time, and in any form.
Rather than focusing on inventiveness and creativity from individuals and teams, Google encourages every team member to contribute their best ideas.
For instance, it was once reported that a certain doctor on Google’s staff suggested that Google provide assistance and support to users searching for keywords and phrases related to self-harm and suicide.
Google keyed into this suggestion and adjusted its search engine to display the Hotline number for the National Suicide Prevention. This singular step led to a significant boost in calls to the helpline, with millions of users getting necessary help.
This commitment and receptivity to innovation at all levels allows Google to tap into the potentials of its workforce.
2. Google believes users come first
In proffering creative solutions to potential problems, Google’s employees are encouraged to put user satisfaction first: profitability comes later. While this might sound contrary to popular opinions, this principle has produced the enviable results Google is known for.
Putting users first is a great way to record much success faster.
3. Aim to be better than your current level
One of Google’s core values is to encourage employees to think outside the box and envision world-class projects.
We can see this practice in the company’s acquisition of Google Maps.
To a less innovative company, making online trip planners and interactive maps would have been merely a common project just focusing on traditional paper maps available for web users.Rather, Google broke the records to develop a system that adapts to the preferences and travel habits of each user. Currently, Google Maps is the world’s best navigation interface with over 150 million monthly users.
4. Technical product insights are more effective than Market Research
Another key principle in the google innovation ecosystem: they believe technical product insights are more effective than market research.
While it’s okay to engage users to know what they want and develop products to meet those needs, experts in the field should also be consulted.
Over the years, Google has successfully improved its search engine, not by asking users what they feel but by engaging critical, technically gifted thinkers to work.
There’s a great reason for this. While customers and users can give helpful advice and tips on how they feel about a particular product, they lack the technical know-how to know the things that are truly possible in product development.
This does not in any way mean Google ignores suggestions from users. In contrary, Google pays close attention to what users say. But they also understand that the biggest hacks come from those with technical expertise in product development.
5. Ship and iterate
One of Google’s open innovation ecosystems secrets is its iterative progress. It advertises products and services to its customers, then uses an effective feedback system to move step-by-step towards the best possible version.
Instead of waiting for perfection, Google understands that products and services are improved through user feedback. That was why when it first launched Chrome in 2008, it opted for a learn-as-you-go approach, updating the browser every month to iron out every limitation.
This iterative process is a great way to smoothen innovative products over time.
6. Commit to open innovation
Google has a track record of embracing the wisdom of its users, and its flair for inventive and innovative products tells us a lot about the very real benefits of this kind of open innovation ecosystem.
For instance, when developing its Android platform, Google knew it needed access to the world’s top developers to fulfill its mandate.
Therefore, it encouraged developers outside the company’s workforce to create their own apps, forming a creative, open innovation ecosystem.
As a result they got millions of apps created for Android users on Google Play.
The concept of an innovation ecosystem is a reliable framework for business leaders, entrepreneurs, product developers, and other stakeholders in the value creation chain.
We believe the information we provided in this post will help you understand why you need an innovation ecosystem and how to go about it. Stay with us, subscribe for 3 new articles coming each week.