The recovery is on. Buyers are ready to spend on worthwhile inventions. Emerging markets are looking for entirely new products. How do manufacturers quickly meet their needs? Innovate by committee.
The Philips Electronics laboratories in Eindhoven, The Netherlands, used to be the spitting image of a top-secret corporate research and development facility: Razor wire and a foreboding perimeter fence surrounded a cluster of darkened buildings penetrable only through an uninviting entrance gate staffed by a tough security crew.
Today, the Eindhoven site is much more the picture of a community center than of a clink. Made over and rebranded in 2003 as the High Tech Campus Eindhoven, it houses some 7,500 employees from more than 90 different companies who come and go freely and typically collaborate on innovations across company boundaries. In one current project, Philips, chemicals company Huntsman, and others are jointly striving to perfect a new organic LED lamp made of flexible materials. A malleable LED light would greatly enhance the design possibilities, leading to potentially significant market growth.
Eindhoven has become such a matrix of collaboration that Philips, itself, is not always the centerpiece. The organic LED initiative, for instance, runs under the auspices of Eindhoven tenant Holst Centre, which is a cross-fertilization facilitator.
And in an earlier collaboration, Philips designed its popular Senseo coffeemaker in partnership with consumer packaged goods company Sara Lee.
“It’s the new mind-set of openness,” says Gerjan van de Walle, business director of MiPlaza, a division of Philips Research that coordinates and encourages open development.
Welcome to the world of open innovation in which manufacturers benefit from broader access to ideas and the cost reductions achieved by tapping the expertise of others. While the idea of collaborating on new products and processes is not new, budget-wary manufacturers in a recovering economy are seeking more efficient and effective ways to innovate. Combine that with the relentless march into new global markets that require different products, plus buyers on the lookout for fresh products, and innovation is climbing the priority ladder of growth strategies.
“We’re taking it to a higher level of awareness,” van de Walle says. For Philips, open collaboration means reaching outside the company for ideas, such as with Sara Lee and Huntsman, as well as contributing ideas to others. Philips continues to work with companies spun out of its research initiatives, such as Liquavista, a company that is attempting to advance the state of the art in electronic book displays.
Replicating the Model
The MiPlaza model has also become a template for other locations. Philips recently added MiPlaza teams to its research centers in Cambridge, England, and Shanghai.
The Shanghai center reflects one of the newest twists in “open collaboration” — progressive manufacturers are increasingly opening their minds to ideas and demands from rapidly emerging markets such as China and India. With those countries and others representing billions of dollars in potential revenue from business-to-business and, in some cases, end-user revenue, manufacturers are accommodating design input from customers and supply chain members in the emerging markets.
