How to Capture Disruptive Ideas with Open Innovation Challenges

Henry Chesbrough, a professor at the University of California Berkeley Haas School of Business, coined the term "open innovation" almost 2 decades ago. As originally defined: Open Innovation is a paradigm that assumes, in order to improve their innovation and technology models, organizations should use crowdsourcing knowledge and broader ideation processes combined with internal knowledge to accelerate their digital transformation.

What is an open innovation challenge?

An open innovation challenge is an initiative promoted by organizations, a community or a public institution that serve as a cradle to develop new products, new services, new business lines or solve a technology issue that is hard to solve with the internal organization resources. The challenge offers the opportunity for bright-minded people to propose solutions following the evaluation criteria and submission templates defined by the challenge promoter. The desired outcome is to identify promising ideas and teams that can partner on an innovation opportunity with the promoter in the future, but the initiative should be also used to involve external high skilled profiles that can quickly build, test and iterate on fresh new ideas and approaches.

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People should be encouraged to take risks, thus the nature of an open innovation challenge or a hackathon is to generate ideas, POCs (proof of concepts) or Prototypes and not production-ready products. The challenge contest occurs online over a 1–2 month timeboxed period defined by the challenge promoter or materialized in a 1–3 days physical event, frequently coined as "hackathon", or as a mix of both. As an example, EDP, the main electricity provider in Portugal launched on TAIKAI, an online challenge that ended in a Demo Day where the finalist had the chance to pitch their ideas to the EDP board of directors in a ceremony at Electricity Museum in Lisbon.

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Challenge Goals

Before we dive into the challenge operation, the promoter should identify the answers to the following questions. What is the main challenge purpose? New Products or Services, Hiring, Marketing and communication purposes? What organization departments should be involved to generate more value for the organization? Innovation Department, IT, HR, Marketing or Sales? What are the criteria to provide a valid challenge submission? Ideas, Prototypes or MVPs? Do you have a post-challenge plan for the solutions? Do you want to use the submitted prototypes and productize them or invest in the best teams? Do you want to hire the challenge best performers? The next step is to prepare the right set materials to describe your proposal and publish your challenge to a broader community. But, don't worry, we enumerated a list of tasks to prepare in advance before the challenge gets published.

Challenge Pre-Launch

1. Describe the challenge goals precisely This is an essential topic to increase the engagement of your initiative. This should be described and communicated precisely, so, try to publish regular updates when an important update needs to be announced.

2. Choose the Participant Target Audience Define the participants' required skills to match the challenge goals. Is the challenge only open for IT profiles or students? Is the participation open to everyone? Are Data Scientists, Designers, Deep Scientists, Product Designers skills required?

3. Create comprehensive rules and terms Yes, it is time to define the registration rules, the evaluation process, participation eligibility, prize distribution, cancellation policy, and code of conduct for the participants. Be concise and don't try to create long policies that are difficult to read in more than 10 minutes. An important topic to address is: who is the owner of the intellectual property rights relating to the projects that are created during the challenge?

4. Define tangible deliverables Enumerate all the materials that the team members have to deliver in order to achieve challenge goals. What are the deliverables that are evaluated by the juries and the weight of each?

5. Create a plan to support participants Doubts and questions from the participants are going to be around. Have a list of prepared FAQs and a support chat for quick responses.

6. Select a panel of juries that have expertise in the field Recognition is a huge incentive for participant engagement. Selecting a set of experts on a field will raise the awareness of the challenge and help participants to take a step forward to register as a participant.

7. Provide the right incentives and benefits for the winner and the other participants Cash Prizes are not the only way to incentivize people to join a challenge. Social recognition and social exposure or customized prizes like event swag can make them proud of their participation. In most hackathons, only the top three projects get a cash reward, notwithstanding you must design incentives to reward all the participants that dedicated their time and effort to create amazing projects. Within our platform, we use rewarding mechanisms to feed our social rankings and increase the participant recognition on a field.

8. Prepare a marketing campaign to attract the right talent and maximize participation The marketing plan is crucial to bring the right talent to the table. You should use your social media presence, promote the initiative on universities, accelerators or incubators. When possible physical events are the perfect way for you to find your target profile and get your initiative a significant exposure.

Challenge Timeline

It is crucial to define a clear and timeboxed schedule to guide the participants through the challenge's journey. Proper scheduling should be defined based on the type of problem that the participants are trying to solve. Short timelines might decrease the quality of the submissions proposed and long timelines could also decrease the innovator initiative engagement. As an example, in the next image, we have a schedule-timeline for a 32-hour challenge:

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On TAIKAI, we typically split a challenge into the following stages:

Registration — This is the period required to promote the hackathon on distribution channels and acquire the right set of innovators. A proper registration period should allow the promoter to find the targeted profiles. An organic campaign usually takes more time to achieve results , so for quicker results we recommend paid campaigns on social networks like twitter, linkedin and faceboook.

Ideation — The ideation period is the stage where innovators gather in teams and start brainstorming about their submission. Some mentoring from the promoter could also be helpful to steer the participants in the right direction. At the end of this stage, the participants should have a high-level overview and a plan to work on their team submission.

Incubation — This is where the magic happens. The innovators work as a team to create the deliverables defined by the challenge rules. Detailed business plans/descriptions, Proof Of Concept, UI Mockups, and PowerPoint presentations are usually the output of this stage.

Pitch — At this stage, the innovators should present their submission to the challenge juries as a presentation form. Note: This is only applicable to offline challenges, although we are seeking ways to also do it online.

Evaluation — The Juries should evaluate the innovator's submissions using the criteria defined by the challenge's promoter. It is important to have a broader set of skilled experts with experience. It is recommended to mix people with business skills & background, a scientific board, and a set of experts on the challenge topic.

Winners Announced — This is the period where the promoters announce the winners and distribute the prizes to the best submissions.

After the challenge

This is the final stage of your open innovation initiative and must be used to measure the results of your challenge. You should use this period to measure the quality of the innovator submissions, performance of the best teams, track some interesting participant profiles, measure the participant engagement and contact the participants to fill a feedback survey.

In some cases, the promoter company could invest resources and cash to finance the productization of some cool projects created. There is a public record of some fresh new business services, ideas, and new startups that emerged from this kind of challenge. It is brilliant how new perspectives and approaches can blossom when you merge people from different backgrounds, skills, and cultures.

The open innovation model might be the answer to transform quickly organizations into the digital economy and embrace a completely global and cross-cultural product fit..

How TAIKAI as an open innovation social network can help you on this journey? The TAIKAI platform provides a digital web platform and content management system to publish your hackathon to a wider global audience.

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Main benefits for Challenge Promoters:

  • Create and curate customized content for the challenge
  • Manage the challenge submission and participation
  • Use a token-based voting system to select the best projects
  • Communicate online with the participants
  • Smooth onboard for challenge juries
  • Outreach targeted talent profiles
  • Transparent transfer of value between challenge stakeholders Apart from the platform, we might help our partners to identify innovation areas that are a priority for them.

Do you need help to set up a challenge? Drop us an email to [email protected]

Helder Vasconcelos
Helder Vasconcelos
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