Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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How did this all come about?
How did we collectively make it
happen?
Are there lessons in this for global
collaboration?
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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CIBER (Centers for International
Business Education and Research)
National,
Local
International Business Center at Katz awardsInstitutions
GAP (Global Academic Partnership) grants
Ravi Madhavan,
recipient of 2009
GAP grant
Connect
Members of
Organizations &
Entrepreneurship
group, Strategy
area
Common interests in
innovation,
collaboration, and
education
Sue Cohen studies how
where knowledge
resides matters for
innovation, interest in
global locus
Connect
Lou Musante,
Managing
Partner Echo
Strategies
Connect
Committee to Connect
develop University
Rabi Chatterjee,
Technology
Prof of
Commercialization
Marketing
program
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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How do we understand the best ways for firms to collaborate
globally for innovation advantage?
Country differences
Industry differences
(resources, market,
institutions, culture, etc.)
(mechanisms to
protect IP, nature of
innovation, etc.)
Firm differences
(global strategy or
multi-domestic,
innovation leader or
follower, etc.)
Content
of the
forum
Bring together individuals who understand global collaboration
from a diverse array of perspectives, to get a broad sense of the
landscape and to identify research questions with high payoffs for
theory and practice.
Academic
diversity:
Management,
Law, Economics
Country diversity:
U.S. and China
Professional
diversity:
Business
Executives and
Scholars
Composition
of
participants
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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But what kind of experts in each domain do we need?
Our starting point for search was our understanding of the landscape of issues relevant
to global collaboration, that we could sample from.
What issues do academics think are important and what issues resonate with our
executive audience? Assessing the terrain and areas of high potential dialogue required
iterative face-to-face conversation between Lou and Sue over several months.
Our search for relevant experts in academia and practice occurred simultaneously to
these discussions, and together this helped to define the tracks for the forum.
Our search for suitable experts (those with competence and interest in subset of the
issues deemed of relevance to both groups) was conducted globally and locally, all
through personal networks.
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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Now, how do we facilitate a productive conversation amongst the members
of this diverse group, in a way that increases the chances that everyone
leaves with something of value?
Receptivity:
Engagement & Exchange:
selection, based on
common interests
through themed tracks with
issues that are tangible to
most groups
setting conducive
to conversation
designated roles –
presenters, Q&A panel
periodic reflections, “take
aways”
Synthesis:
discussion around themes
amongst diverse groups
multi-media data capture
discussion around areas of
agreement, areas of conflict
or gaps in understanding,
implicit theories behind ideas
distill, classify insights
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
Spotting opportunities (for innovation)
 Institutions create targeted opportunities (around specific agendas)
 Networks bring together the people that exploit them, more so than co-location
 Collaboration around common interests provides richer insight into interests and
competencies, which suggests fruitful connections amongst other parts of people’s
networks

Crafting a vision (for something potentially path breaking)
 Face to face interaction facilitates synthesis of diverse perspectives and knowledge
of different tools and how they might be used
 Overlapping absorptive capacity enables faster synthesis across disparate thought
worlds

Mobilizing resources (for collaboration)
 Innovation requires engaging a sample of good people with diverse competencies
but a common interest - there is no optimal configuration - many potentially
fruitful mixes of people and domains exist
 Networks (that bridge thought worlds) provide access to people in diverse domains
 Networks act as two sided quality filters – enables faster mobilization
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
Rather than debate whether firms need to locate R&D in
specific places, to sustain their innovation capabilities, the
more salient issue is:
 What to locate where
▪ Different factors drive success in Invention and
Commercialization and this could mean they should be
located in different places
▪ Yet, success in invention can be influenced by an
understanding of customers and the context in which
products and services will be used, so there may be value in
co-locating invention and commercialization
▪ So, we should ask: When is it important to locate invention and
commercialization in the same place?
▪ To address this question we need to be clear about what we
mean by invention and commercialization? What are the
boundaries of R&D?
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh 9
Forum on Global Collaboration for Innovation January 7-8, 2011

Boundaries of R&D need to be rethought… possible linkages:

Research = Science from Invention and Discovery…but how much
development of scientific knowledge do firms actually do? in many
industries, most of this kind of research has shifted to Universities.

Development = Development of Technology where Technology is
defined as the application of Science to solve problems / usually
the Technology is actually a Platform Technology that can solve
many problems AND that is good and bad. What problem should a
platform technology solve? To make money and receive funding to
commercialize you have to FOCUS usually on specific problem in a
specific market.

C = Technology applied to a specific problem to solve in a specific
market
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
Rather than debate whether firms need to locate R&D in
specific places, to sustain their innovation capabilities, the
more salient issue is:
 What to locate where
▪ It may be more useful to think about separable discovery and
design tasks and consider their ideal locations apart from
whether they reside in a traditional functional R&D unit.
▪ Perhaps R needs to connect with parts of the C function – to
better prioritize potential problems that emerging solutions
could solve….there may be less need to connect R and D
▪ The role of IT in each, and the function of IT in connecting
people, may differ for distinctive discovery and design tasks.
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
Interesting observations about R&D that affect the
answers to these questions:
 R&D as a function is really about the care and feeding of scientists
 Projects are the only truly manageable locus of capability – The potential to
reconfigure the ”pipes and prisms” of intra- and inter-organizational
knowledge flows resides here
 Benefit of separation is to allow for immersion in one ‘place’ – distinctive
experiences, to sustain pools of diverse understanding
 How we define R&D matters.. Connecting the potential in medical microdosing technologies with the functionality in the Freestyle Coke dispenser –
Collection of fine-grained customer data from the machine that can be used
to refine customer experience  Which part of this is R&D? Same
mechanisms for opportunity sensing and creation, just different groups
involved?
 R, D, C all operate in different temporal windows of opportunity
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
From how much contact/overlap should we have
between Research and Development (an issue that
affects their country co-location), to:
 How do we manage design and discovery driven
innovation in the same organization?
▪ To create fluid organizations,
▪ That can exploit opportunities provided by open innovation
and IT, and shifting centers of global excellence
▪ Thereby continually creating unique innovation spaces where
the firm invents/innovates faster than others, despite
diminishing abilities to protect IP/knowledge outflows
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
From considering the role of IT mediated communication as
a vehicle for reducing the need for presence to:
 Considering how firms can develop IT infused innovation
capabilities:
▪ Involves conceptualizing IT not just as a communication tool, but
also as a means of:
▪
▪
▪
▪
Shrinking all distances – not just physical distance (WalMart)
Changing what location means (not solely geographic or functional)
Sensing and searching for opportunities (Dick Kouri)
Empowering customers to create their own interaction with the firm
(Abercrombie)
▪ Facilitating others’ search for you – make our “connectability” visible
▪ Inputs and outputs to IT are interpretive – need to connect domain experts to
utilize – so infusion means integration into interpersonal networks as well as
cognitive frames
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
From considering the role of IT mediated communication as a vehicle for
reducing the need for presence to:
 Considering how firms can develop IT infused innovation capabilities,
cont’d:
▪ But, there are cultural barriers between IT and R&D – How do we overcome them?
▪ Project planning mindset dominates in IT
▪ Involvement of CEO, CFO is critical – need a “seat at the table” for IT and
R&D
▪ Who is pushing for change matters a lot to whether and how it will happen
▪ Individuals at all levels of the firm need to assimilate a sense of the potential
of IT to transform not only how they work but also the value, functionality
embedded in the end products they create
▪ How do we build trust without face to face engagement? How is engagement
via IT different from face to face? What understanding do we lose?
▪ “Adaptive structuration “suggests unexpected gains from forced
collaboration – but the power redistribution that can result from new
information (e.g. customers drive innovation, IT shares decision rights)
makes it difficult to implement in established firms
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
▪
One answer to “what to do where” is not to conduct core R&D activities where a
firm cannot protect its IP. But markets and a need to be close to customers can
create the opposite pull. Rethinking the way a firm benefits from particular
locations suggests other ways of answering this question.
Think more broadly about ‘how’ to be there (from location as a way to access
country-specific resources, to location as a place to create firm-specific resources) :
 Is being there virtually sufficient for the discovery / design activity?
▪ IT enables collection of fine-grained customer data remotely. Does it
provide sufficient insight into what the next leap in new technologies will
be – over 5 years out? Can it provide insight into the next wave of
functionality that customers will value?
▪ IT enables dispersed collaboration for platform technologies, solving
known problems. Can it enable architecting, visioning, ideation as well?
▪ Does the potential to use IT to minimize the need to be there for
invention/innovation depend on whether firm is sourcing information in
unstructured form – silly putty <as yet undefined experience want
customer to have, health care> or structured form - Legos <Apple platform
technology, scientific knowledge>
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▪
What do I need from this place? Can I do these things remotely?
▪ Opportunities are recognized through serendipitous encounters that illuminate
connections across domains – discovery of problems to solve
▪
▪
Opportunities are created through synthesis, engagement, and interpretation across
domains – solutions are designed
Am I am going there to listen, to learn, or to lead? How should I engage in these activities?
▪ Listen - taping into relevant talent net/customer networks versus sense of place - hearing
what is meant, developing subjective connection to the place
▪
Learn - what unique access to talent and customers can I develop? Consider varied routes
your firm and others can access knowledge (e.g. third party technology providers). What
happens if you don’t collaborate? Who will?
▪
Lead (here separation is better?) e.g. plot a way out of chaos, e.g. Apple, firm that creates
a vision for markets in flux can attract others who fit within that vision, by providing
direction and acting as a hub that connects the parties needed to make it a reality)
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
How to be there (location as a place to create firm-specific
resources)
▪ To acquire resources, or to engage and transform resources?
▪ Transformation occurs not simply by investing in community resources and local
infrastructure, but by combining local resources with firm-specific resources, to
imbue them with firm-specific value
▪ Transformation of community resources enables quasi-appropriation:
 Enhances the value of relationship with the firm over other potential
employers/partners
 Creates resources that attract other desirable partners to the region
 Produces a sense of place, which underlies firm-specific insight into local
opportunities
 Embeds firm uniquely in local innovation system, to better exploit
opportunities
▪ What is the first thing we should do to engage local resources?
▪ Cities as life support systems – where can you help? Where is the pain? Will
getting involved here place the firm in a meaningful position to learn what
problems it can solve or how? <IBM’s Smarter Planet initiative comes to mind, as
a way to sense these things…>
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
From what capabilities should we build, to how can we leverage global
collaboration to innovate faster or smarter?
 See also slide on fostering collaboration between IT and R&D
 IT enables data processing – but being smarter means asking better questions
– connect domain experts to jointly define the initial Qs - collaboration leads
to new shared cognitive filters for sensing opportunities for invention and
innovation – role of language in constructing shared understanding of
desirable firm capabilities
 Redefine the problem space to one where the structure of collaboration
required to solve problems enables sustained differences in how firms sense,
create, commercialize innovations….e.g. we are not sellers to our customers –
we buy and bundle solutions for them, we co-create with them, we chart a
vision and put in place the collaborative infrastructures, platforms to create
for/with them
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 From what capabilities should we build, to how can we leverage global collaboration to
innovate faster or smarter?
 Gang /Mier/ Allen – since IP is often of questionable value in protecting innovations,
both for institutional reasons and because technology is available through so many
different sources, firms need to position themselves to be better collaborators. This
includes positioning firm in national/regional innovation clusters and networks and
systems to sense early, mobilize faster, and suggest firms should worry more about
knowledge inflows and how to exploit them then they worry about outflows. It also
suggests there is no one best set of capabilities to develop – many possible ways for
firms to create unique combinations of knowledge resources.
 How should firms leverage R&D service organizations? How does this differ if you are
the innovation leader vs. you are playing catch up?
 How much R does a firm need to do? Does it depends on availability of absorptive
capacity or bridging organizations, like TTPs?
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
How to adapt to the “wrong” country?

How to look at differences across legal institutions as potential
opportunities?

Regional transfers across regions within a country may be an
important element of national innovation system firm can take
advantage of in locating – e.g. in China cross regional transfers
through Universities are encouraged and managed

Governments stimulate innovation in m any indirect ways – e.g. by
funding Universities. How do the differences in whether
innovation regions are supported by various ground-up vs. top
down government initiatives matter for the way firms can tap into
the knowledge generated in the region? Which ones seem to
correlate with innovation regions being discovery vs. design driven
– or falling somewhere in between?
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
How do location and spillovers relate to exploitative versus
exploratory innovation? Note there is a difference in what these
mean from discovery versus design driven innovation, and
confusion in the literature about these terms. Usually exploration
means to move into new domains, innovate in ways that build on
little of a firm’s experience, whereas exploitation occurs when
firms do more of what they already know how to do well.

How can firms organize to capture exploratory and exploitative
opportunities in a region?

We need to understand how knowledge and innovation flows at
different levels (individual, firm, region, country, global) affect
each other, since each will likely be managed differently.
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
How can innovation be better integrated into a company’s corporate strategy?

Some believe separate of R & D is the end of organizations as we know them – firms
are instead comprised of systems of relationships with more transient functional
boundaries.

To find the right organization of R, D, C need to first understand the natural flow of
these activities, then decide where they should reside. Groups need to understand
the lifecycle of what the other group is creating – scope and durability of solutions.

Management of transitions between activities is key. Need to manage overlap to
enable insights consistent with activity lifecycle and minimize distraction.
Managing connection is also about managing and sustaining absorptive capacity.

Ideal separation likely differs by industry, region, and company. Historical
contingencies of firms’ co-location of these activities will constrain adapting these
boundaries.
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
Outsourcing of R & D & C – what are the effects on a firm’s
absorptive capacity and ability to assimilate knowledge and
technologies from geographically dispersed listening posts,
knowledge factors, design driven clusters? Does it depend on a
firm’s position in national innovation systems or regional clusters?

Are there configurations of R, D, C activities that are more
successful for certain strategies or for particular kinds of
innovation than others?

How does thinking about innovation as an open system alter the
possibilities for organizing R, D, C? Perhaps we can think about
these choices as ‘make or buy’ decisions and consult the mergers
& acquisition literature for insight into how to manage the
associated search, transaction, and integration costs. How to
manage the risk of knowledge outflows and harvesting of ideas
will have to address cultural differences and failure management.
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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
When to be there?
 For what kinds of discovery and design activities?
 Boundaries of R&D need to be rethought – inside and outside the firm
 Integration of IT & R&D needs to be better understood

How to be there?
 What kind of innovation system will benefit me, what role should we
play in it?
 How to engage country-specific resources to create firm-specific
resources – priorities, specific kinds of actions?

How best to manage organizations to benefit from these various
knowledge flows and maximize the gains from discovery and
design driven depends on all of these factors
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
25

Make the forum an annual event

Include a focus on other emerging markets
(India, Brazil)

Expand the disciplinary and industry variation
of participants
Katz Graduate School of Business - Echo Strategies - International Business Center, University of Pittsburgh
Forum on Global Collaboration for Innovation January 7-8, 2011
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