Dr. Sigvald Harryson, Professor of Disruptive Innovation and Founder of iKNOW-WHO, tells us why, when it comes to progress in packaging innovation, the concept of ‘the winner takes it all’ no longer applies.
Up until the 1980s, most large packaging companies focused on solving innovation challenges through internal resources, in isolation. But today, the internal approach simply doesn’t cut it when it comes to solving the significant challenges we are facing in packaging. It will no longer be acceptable to combine bio-based and biodegradable packaging materials with coatings of aluminum, or liners of fossil fuel derived plastics to protect food and beverages, because such packaging material combinations can neither be recycled, nor biodegrade in composting systems.
Fortunately, incremental innovation in isolation, with one company gaining full ownership of internally created results, is being replaced by radical innovation in co-creation with open IP sharing among all deserving partners behind the breakthroughs. Interestingly, it is the largest companies in the world that are first in daring to open up their R&D to the vast world of universities and other co-creation partners who team up to jointly solve the packaging challenges. We, of course, can also confirm that some packaging companies do work with universities, but their model of collaboration is one-directional and exclusive. By contrast, we see how the largest companies in the world establish co-creation models that are bi-directional and inclusive for all universities – not exclusively limited to the top 25 universities. In our experience, universities on the top 25 list are more interested in Nobel prizes than in solving real challenges. Moreover, most of these universities are unwilling to share IP from co-created breakthroughs. In our experience, the remaining 99.9% of the world’s universities represent far more co-creation and IP sharing potential than the one percentile of universities that most companies keep in focus for collaboration.
What does this actually mean?
A one-directional university collaboration is when a company asks one university team to solve one specific challenge. The company shares nothing on past internal experience from failures in solving the challenge. The university selected is typically in the global top 25 league, so all companies actually work with the same few universities, which naturally become fat cats. No other university is involved in the collaboration, so the method is limited to a ‘we pay, you deliver’ collaboration and does not embrace a ‘we are all in this together’ co-creation model. Therefore, results represent incremental innovation in isolation.
So, what is a concrete example of co-creation of extreme breakthroughs?
The largest FMCG company in its category teams up with nine university teams from the whole world, including Latin America, Asia and eastern Europe. None of these universities are on the top 25 ranking list of fat cats. By contrast, all nine teams are hungry tigers. Two companies are added as co-creation partners – one with more than 50 thousand employees and one with less than 50 employees. These 11 teams co-create new packaging materials that are continually prototyped and tested with full sharing of all results among all co-creation partners to accelerate learning and progress. Company executives confirm that results are accomplished at least 10 times faster through co-creation than when waiting for the conventional packaging industry to solve a sustainability-related challenge. Some players in the conventional packaging industry still enjoy so much profit from unsustainable packaging that incremental innovation in isolation remains their choice – to the detriment of our planet.
Instead of reaching out to the world of co-creation, some conventional companies pursue internal development of new materials – whilst there is a whole world outside with the profession of material development. Porsche may make the best cars in the world, but they certainly do not invest time developing new rubber materials for tires. Instead, they work more with universities than any other car manufacturer in the world (for more information see Harryson & Lorange, Bringing the College Inside, Harvard Business Review, December 2005).
The winner takes it all concept may have been cool in 1980, but it is uncool in today’s reality of global warming and growing mountains of packaging waste – driving people from their homes in places like Bantar Gebang, and building ‘great’ Pacific garbage patches that squeeze out the fish we would need to survive on our planet.
We all need to move on from the winner takes it all to the winners make it all. By moving from exclusive one-directional collaboration with a top 25 university, to inclusive multi-directional co-creation with the entire universe of universities, we all become winners.