User Generated Intelligence...Innovation Exchange

As the media application of social networking ensconces itself from both the local and national stand point, fortune 500 companies continue to grapple with how social networking could play deeper into their corporate strategies. To date, leveraging the social graph has provided a means for efficient media and a unique opportunity to observe and listen to chatter about brands but few companies have truly harnessed the power of networks to further develop their products and services.

One area that may help to bridge the utility gap for global brands is the use of social networking to create a platform for open idea innovation. Innovation within major global companies has historically been kept behind closed doors but the opportunity to gain valuable consumer insight and compensate big thinkers whoever or wherever they may be, for their big ideas is starting to come into vogue.

Admittedly, I was a bit skeptical about the concept. While clearly monetization is not an issue, the logistical hurdles behind this type of platform seem extremely complex:

• How do individuals protect their intellectual property - Is it possible to create a trusted environment?
• How does one motivate contribution and attract quality thinkers - after a few failed submissions, when do the ideas stop flowing?

To discuss some of these challenges, I had an opportunity to catch up with Mark Hadfield, CTO of Innovation Exchange. Innovation Exchange is one of the first online open innovation marketplaces. It has recently moved from being a private network to a public one. Community members from all over the world respond to challenges sponsored by Global 5000 companies and not-for-profit organizations.

Mark has been applying the latest social networking tools to create a trusted online community for contributors to shine. While only a select few will win the challenges and earn anywhere between $50K and $100K for their ideas, Mark explained that public recognition, progression and competitive ranking are key ingredients to the success of Innovation Exchange’s platform.

Mark went on to describe the legal details that were involved in protecting contributors as well as the security mechanisms put into place to provide a comfortable, trusted environment.

“The market has amazing potential and is in its infancy,” said Mark, “Global brands are realizing the tremendous value of open sourcing their innovation challenges”.

With a rapidly expanding client base of global brand name organizations and a growing number of regular contributors, Innovation Exchange is definitely on to something. Clients are willing to pay not only for the big ideas, but also for incremental innovations, that can be quickly brought to market.

The future will depend on how well the platform stimulates contribution and motivates community members to stay connected. Global brands will be attracted to a pipeline of creativity. Time will tell if the model will sustain the volume and freshness that is so critical to its success.