THEME #4 FROM 7 PART POST SERIES EXPLORING THE EVOLUTION OF BRAND STORIES & THEMES
The arts are one of the few industries that exist today where exclusive control may result in a stronger creation. Think of musicians who have succeeded without a record label, or independent films powered by open social interest. In business, the opposite is happening. Greater innovations are being created through shared IP and collaborative strategic partnerships. This open approach to business development is counter to traditional beliefs that IP if closed/proprietary, or so unique that it is incompatible with competition – would be of greater value to the market. The business culture and leadership vision, whether closed or open, is evident in a brand. Brands born out of a culture that is closed and control-minded, usually show limited interest in engaging with people and pursuing new collaborative partnerships. In contrast, brands born out of an open, social, and collaborative business culture, are usually the brands that are most enduring, share-worthy, and human.
Open vs. Closed
Open systems vs. closed systems. Open source vs. proprietary standards. There are strong arguments for both sides of the discussion. Those in favor of a more open approach to development and knowledge sharing say it maximizes creativity through group-think and collaboration opportunities. Open standards are believed to allow for the rapid and a less expensive approach to development of products and services because of the reduced ramp-up and on-boarding time required. On the other hand, those who support a more proprietary and closed approach, whether technology or brand communication, have valid fears that the open model can result in loss of control, lack of accountability, and long-term inefficiencies due to the varied sources of input.
Beyond code there’s coffee
The debate of “open” vs. “closed” is often thought of as having a technology impact i.e. Apple vs. Google. But the business philosophy of being compatible- or not, is evident in all aspects of daily life. Just think about the evolution of coffee makers. First it was the different shaped coffee filters, basket or cone. Then came the pods, K-Kups, bags etc. all “specially designed” for use only with a specific coffee dispenser/machine. Who is benefitting from this proprietary design approach? Is it really the people? Does a pod, k-cup or bag really make the coffee taste better? All too often, exclusivity of design or distribution means that consumer choices are limited and usually more expensive. Business strategies that rely on exclusive control or planned obsolescence to gain or retain market share are relying on customer patience and living on borrowed time.
Sony
According to a Fast Company article by Kit Eaton, Sony has a long history of format failures that stems from a leadership and culture preference for proprietary Sony-centric formats. This history of failed “innovations” dates back to 1975 with the launch of the betamax video, 1993 with the minidisc, and the memory stick in 1998 for use on its own digital cameras and portable music players. I have one of these cameras collecting dust in a drawer somewhere so this article hit a personal nerve. The proprietary format created by Sony was for the creation of additional revenue streams – not a better digital media experience for me. The proprietary format also meant that it costs more to access the media off of such devices and develop/process as with other photos or videos. How is this a benefit for me or an advancement for the industry?
We see that in Sony’s case, from a storytelling standpoint, being “first to market” or product attributes such as “proprietary ” were no longer enough to power market interest or strengthen their brand. Limiting compatibility does not make a business stronger. Proprietary and closed innovation that is not people-minded but “corporate control-centric” signals a limiting relationship between the customer and Sony. “Innovations” that hinder verses help enrich the customer experience is not industry progress, but at best – just “different.”
Open Innovation
“Open Innovation” refers to more than just crowd-sourcing ideas. It represents a business philosophy wherein the corporate culture is open for external input (see Environmental Leader Post regarding CSR: Is it Becoming Unsustainable?) Whether feedback comes from within the organization, i.e. employees or departments, or externally from customers. Such input can result in great innovation opportunities.But only if businesses know how to identify, harness, and implement such ideas.
Open innovation does not require ideas to be new the company.Businesses who pursue strategic alliances by leverage their existing IP, can co-create and together achieve new heights of ingenuity. What is most exciting is that often such collaborative efforts are so unique in their mix of IP and shared resources, that it results in producing true market advances. We are starting to see more of this co-creation through shared IP in business, especially in the pursuit of more sustainable solutions.
Coca-Cola and Ford
Researchers from Ford and Coca-Cola recently collaborated on the development of a new fabric for thelaunch of theFord Fusion Energi. Coca-Cola shared itsPlantBottle™ packaging technology to help Ford create a more sustainable interior. The result was the creation of a fabric made up of 30 percent plant-based material. This materials was used throughout the car’s interior forthe door panels, seat cushions, headrests etc.
John Viera,global director of sustainability and vehicle environmental matters at Ford Motor Company shared the following statement:
“If we are going to truly make a difference, we need the power of numbers. We need to reach beyond the four walls of Ford and find like-minded people in like-minded organizations to work with us….Applying sustainable business practices is not the job of one person, one manager, one department – or one company. It’s all of our responsibility. And that’s why we will continue to look across industries for new areas of cooperation and collaboration with partners such as Coca-Cola.”
Open Leadership
The creation of open corporate cultures does not happen as the result of relaxed or distanced leadership. Just the opposite. We see CEOs becoming more involved and adopting culture building as their personal mission.IBM’s 2012 CEO Study cites collaborative cultures as being key to business success and a paramount focus for CEOs.The study points out that nearly 70 percent of the global CEOs mentioned strategic partnerships as being key to being competitive and building a differentiating business strategy
“The pressure to innovate is not subsiding, and organizations are teaming to meet the challenge. Compared to their less successful peers, outperformers are partnering for innovation more aggressively. But they are also tackling more challenging and disruptive types of innovation. Instead of settling for simply creating new products or implementing more efficient operations, they’re more likely to be moving into other industries or even inventing entirely new ones.” – CEO, Retail, US.
CEOs cited “employee engagement” as being key to business performance. When asked about the top three organizational attributes needed to create employee engagement, the following three attributes prevailed:
Attributes of Employee Engagement
Ethics and Values 65%
Collaborative environment 63%
Purpose and mission 58%
A company’s evolution from being a closed and proprietary driven culture, to one that is social, open, and collaborative, is ultimately not a choice of management style, but one of business survival.
by Anneliza Humlen of SocialVoice LLC. / @ADHumlen
Special thanks to bmills for use of “Closed” photo. Pictures for Sony and Coca-Cola Ford, are sourced from the original Fast Company article and Coca-Cola Press release.
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