41. Tom Staley: Why Open Innovation Still Fails – and How the Best Organisations Are Finally Making It Work

Recognised as a Trusted Advisor, Tom works across the Public, Private and Defence Sectors, enabling organisations to establish the foundations to innovate, while leverage the capabilities of a diverse partner ecosystem; from startups to hyperscalers, in order to experiment, scale and commercialise new solutions.

Tom is a member of the British Standards Institute (BSI) committee for Innovation Management, and is actively contributing to the ISO 56000 series of Innovation Management standards.

Transcript

Intro 0:00

What's it worth? Uh-uh. Uh-uh. Uh-uh. What's it worth? Uh-uh. Uh-uh.

Simon Hill 0:09

Welcome everyone once again to the Total Innovation Podcast. As always, I'm your host, Simon Hill. If this show is about one thing, it's about how we move from innovation theater to innovation performance to value creation. Today we're diving into one of the most important topics facing leaders right now: open innovation in the age of AI. Yes, an AI podcast. Because let's be honest, collaboration has been a buzzword for years. Ecosystems, partnerships, startup engagement, co-creation. Yet, despite all the activity, many organizations still struggle to translate innovation, open innovation in particular, into sustained, measurable value. So what's different now? Well, the open innovation report published last year out of Software Steria Next suggests we may be reaching a tipping point, or maybe we've passed a tipping point. AI is accelerating change, exposing capability gaps, and forcing organizations to rethink how they innovate, who they innovate with, and how culture either enables or blocks progress. Joining us today is Tom Staley, whose work through Software Stereodex and the Exchange has focused deeply on the intersection of culture, collaboration, and innovation performance. I think, and I hope this won't be a surface-level conversation. We're going to instead try and explore what actually works, why many organizations still stall at proof of concept, and what leaders can practically be doing to move from aspiration to impact. And with that, welcome to the podcast, Tom. Thanks, Simon. Great to be with you. So let's first of all give a little bit of background. Um tell listeners a little bit about Software Stereo Next and your role and the background to this discussion.

Tom Staley 2:00

So we're a European consultancy organization. We offer open innovation services and through our ventures arm, we offer venture clienting and look at ecosystem-based partnerships. I think historically the focus has been on how do you work with hyperscalers and embed emerging technologies, but now we're more and more so looking at startups, SMEs, and thinking about how do we take true product-based innovation into large organizations. And we work both across the public sector, uh, the private sector, and the defense sector. So my role is really working across those sectors and thinking about how do organizations create innovative capacity, how do they create innovative capability so that they can actually ride through all of these emerging technology waves, leverage the benefits that come from them to achieve meaningful outcomes. And that's the focus for us. And I'm sure you've touched on that a number of times previously, Simon, in terms of innovation theater is not what we're here for. We're here to focus on outcomes from innovation. So really working closely with large organizations to think about how they can improve, how they can innovate and drive change so that they ensure that they remain competitive and can secure a competitive advantage as we move through unprecedented technological change, which I'm sure we'll talk about uh throughout the duration of this podcast. So that's that's the core of it, working with organizations, helping them to reinvent themselves and participate in ecosystems. I think that's been the big shift over the past five, 10 years is it's been around how as an organization can we establish innovative capacity, look at trends. Now we see more and more of an emphasis on open innovation, simply, simply put, ecosystem-based innovation. You talked about collaboration, partnerships, they're fundamental to organizations now. So a large part of what we're doing is not only looking inside the organization, but looking outside the organization in terms of the types of partnerships and collaborations that can be formed so that all of the incredible innovation and advancement that happens outside of an organization's boundary can be brought inside the organization, um, as we say, to drive to drive new growth, to drive new opportunity, um, and to ensure that organizations remain fit for purpose over the long term?

Simon Hill 4:24

Yeah, so so all of those things being said, um, open innovation isn't new. I think that you know the research and literature goes back decades that outdated us, I would have thought probably. Um ecosystems are not new, startup collaboration is not new. So, what do you think and what does the report maybe show and your experience show is or has fundamentally changed in this new era, this new wave for open innovation enthusiasm? I do think it's it's this blended open innovation ecosystems piece that is definitely coming to the fore. But I've had people, you know, trying to persuade me for years around the ecosystem language and me being bought in, but not necessarily seeing the timing being right. That I do feel like there is an inflection point either coming or already with us. But but why does it feel like that? And what do you what are you seeing? What does the report and your experience on the ground show?

Tom Staley 5:20

So I think we see a move from what I term as RD outsourcing. So, you know, engaging with the ecosystem to understand what's happening, what's coming next, um, procuring technologies, solutions. I'd say the shift is towards collaborative capability building. And that's what I think is really exciting. It's more about how do we partner to explore these new frontiers, address these business challenges. It's not a pure how can I take your technology and how can I think about its application within my sector? It's how can I take that technology, leverage that technology and build on it, customize it to make sure that it's appropriate for my market and that I can secure that competitive advantage. So I think simply put, I'd say that we've seen a shift from RD outsourcing to more collaborative capability building. The precursor to our 2025 report was our 2023 report. So we run it as a biannual report. And in 2023, um, we saw that 72% of European corporates, corporates being public sector and private sector organizations. So consider that term to cover both public and private sector. Um 72% of corporates were running startup collaborations, and 67% called that type of ecosystem-based collaboration important or mission critical to achieving their organizational strategy. In 2025, we'd seen that increase to 80% of organizations saying that startup collaboration is important and or mission critical to their strategy. And nearly two-thirds had actually run AI-focused open innovation projects. And AI is a really interesting theme throughout the report. Um, I know the market is saturated with lots of insights about AI, and we're continuing to talk about AI, but it's really relevant, I think, as we talk about open innovation. And that was a key highlight from the open innovation report because we we captured this wave of interest and enthusiasm around generative AI. So we're seeing um such exponential growth in capability as it relates to AI outside the organization, but still in a very exploratory phase and in a in a phase of experimentation. And so what we're seeing is instead of just you know straight up procurement of a mature technology, we're seeing more of an interest and intent to collaborate, to explore, to understand that technology and think about its application within an organization's context. So that's been a big shift that we've seen. So I think seeing that 72% of organizations were engaged in open innovation in 2023, you could say that open innovation was mainstream, is already mainstream. But I think what what we're seeing is that the last wave or the last report showed that startups were a bit of a bolt-on. And now we're seeing this new wave, the 2025 report, showing us that the ecosystem is a capability system, especially as it relates to AI-based innovation and the ability to work with AI startups.

Simon Hill 8:22

Yeah, there's a lot in that, isn't there? And it is there is definitely some of that stepping stone of learning and skills. So let's maybe dig into some of those enablers and let's start with AI as the as the forcing function or the enabler, if you if you like. The report suggests that, as you just said, that AI is now more central to corporate strategy, it's more central to the open innovation mindset and collaborations that are happening. First of all, why do we think that's the case? Like what are you seeing that is why is AI so different and why is it forcing organizations to take open innovation seriously, whether they're ready or not?

Tom Staley 9:00

So I think it's the it's the rate of technological change. And and I think you know, we've seen a number of waves, you know, I'm sure we've both ridden them as it relates to, you know, think about blockchain or the metaverse. But you know, if we think about AI and if you look at benchmarks for performance and and the evolution of the technology, so if we just look over the past two years, the improvement of AI models. So context windows, the amount of information that a model is able to consume in order to inform its output, those context windows have expanded from under 5,000 words to over one and a half million. Models have become 10 times faster, 30% cheaper. And if we think about the multimodal content that it's able to consume, whether it be text-based or image, video, um performance on benchmarks, you know, I talked about some metrics there, but if we think about you know accuracy, we're seeing software development, right? Um, the rise prevalence of the use of AI agents as we're looking at coding and building bespoke software. Coding accuracy by the latest benchmark has improved from 4.4% in 2023 to over 70% by 2025. And, you know, there's a number of headlines around the efficacy and the accuracy, a lot of concerns previously around hallucinations. We're seeing that less and less. We're seeing improved accuracy, we're seeing an improved ability for AI to actually operate at a human level of intelligence, being able to perform tasks that take humans' hours, but being able to run those tasks independently. Um, this is quite incredible and transformational. I think it's this exponential growth in terms of the capability. Um, and the fact that we have such a significant level of investment from hyperscalers. We talked about the rate of change being greater outside the organization's boundary than inside it. As of this year, um, the hyperscalers have already announced over $600 billion of capital investment in AI, in AI data centers, in AI-related technologies. That is an incredible level of capital investment that we've we've not seen before. And so organizations really need to be able to tap into that investment to engage in this collaborative ecosystem building as we described. Um Organizations simply can't match that that that that level of investment. And this rate of change that's happening outside the organization, I think, really has placed an emphasis on ecosystem-based collaboration, open innovation as it relates to AI, which has not been the same for previous technology waves.

Simon Hill 11:34

So do you do you think that um, and I saw those numbers recently, I think in this in this in this geopolitical world of European sovereignty, I saw the amount of money, I don't know, that France might invest versus the five hyperscalers, and you know, there it's like a 10 to 1 ratio or something just out of five companies versus a whole country, um, to show some of the scale of lift we need to do on the European side or some level of alternative pragmatism. But do you think that this AI wave, and I need to keep drawing the sort of tooling and the foundation of that into the open innovation piece, is exposing structural weaknesses in how organizations do innovation internally or externally. And I guess just to load into that, trying to put too big a question at you. Where in the organization or in what parts of the business are you seeing that to be most impactful and most sought after at the moment? Like what type of projects?

Tom Staley 12:33

Yeah, really good, really good question. I think AI has exposed clear execution gaps within large organizations, within large enterprise, you know, simply the ability to integrate the latest models, the ability to scale them um into end customer use cases, the governance, the frameworks that organizations, large organizations continue to operate at mean that they naturally go slower. And those guardrails are really important in in some instances, right? Um we need to make sure that you know an end-user customer service in a regulated industry is robust. Um, and that you know it doesn't pose some of the risks or present some of the risks around um you know customer safety that that we'd always want to avoid. But but fundamentally, there's many organizational contexts where we see decision latency. So the governance models um are based on a rate of technological change which are much slower than the reality in which we live in. There's a lack of accountability, um, these are new new areas. You know, who's responsible for AI in an organization? Um we're seeing a lot of you know new roles being created, um, but these governance structures with new roles and accountabilities are still emergent. Um, and the the the ability for organizations still to actually collaborate with third parties and learn from them is is not there. That governance model doesn't extend to actually working necessarily with startups. Startups are still subject to onboarding criteria for tier one organizations, large organizations. They don't have the resource um to participate in those types of onboarding or procurement processes. And so I think there's a number of institutional barriers. If we think about governance, frameworks, accountability, um even down to things around commercial and procurement, where organizations need to be able to rethink the way in which they're structured to be able to not only leverage and accelerate the deployment of emerging technologies, but also to be able to participate in this ecosystem-based uh change that we see and the ability to specifically work with startups who are at the cutting edge.

Simon Hill 14:49

So I'm gonna dig into that a little bit more then. I'll ask you a question and then we'll sort of dig into the concepts of how that's gonna help us move from pilots to performance. But do you think that that means that that open innovation with the context of automation and AI embedded within it has now, has now or must now shift from nice to have to an existential capability? Is that part of the the belief that either Tom has or the report found? Um, do you believe? Or we're not quite there yet in that that level of existential.

Tom Staley 15:23

Specifically an AI capability you're referring to.

Simon Hill 15:27

I'm referring to actually to more broad open innovation, right? Like there's been a lot of European internal focus with bits of dabbling around the edges. And even your 2023 report, I think was it was there, but what we meant by it, right? Again, in the language of innovation, open innovation can mean lots of different things. The practicality, which is why I want to move us into you know, pilot to performance and value creation, off the back of this, um, is is really, I guess, what is open innovation in this sense and how are we going to get there to lead us in? But but has that whole, you must be looking outside. There is so much happening, there is so much change. I mean, that organizations that do not have that structural capability or treat it as a nice to have are at an ever greater risk of absolute disruption.

Tom Staley 16:14

Yeah. No, I think it it does need to become a core capability. Lots of organizations have created innovation teams, uh, again, traditionally internally facing um we've seen the emergence of partnerships, you know, teams looking at the partnerships, but again, managing partnerships across the ecosystem, hyperscalers, um, academia, industry startups, but each each of those groups have a bespoke set of needs and they operate in very different ways. So there needs to be that consideration. But certainly, I think what what we've seen and what the report actually highlights, because we specifically asked the question um do you have a dedicated department responsible for open innovation, for partnerships, for startup collaborations? And we saw that those organizations who told us yes they did had much, much greater success rates. So we see 73% success rates for open innovation projects where organizations have a dedicated department, that is compared to 51% for those that don't. It shows the importance of an intermediary or an entity or a part of the organization who truly understands the problem area you're trying to solve, how to work with the ecosystem, how to leverage the best parts of the ecosystem, wherein the business unit or the business sponsor who has the problem you're trying to tackle can focus on sharing insight and knowledge around that business problem. The business unit that's that's trying to solve the problem shouldn't also be thinking about all of the different elements of the ecosystem, the right partners to engage to address the right aspects of that problem. And so I think we see a specialization in terms of the segregation of responsibilities within an organization. Who's the business sponsor, who owns the problem we're trying to solve? And they need to be work, be able to work symbiotically with a partnerships team who can actually truly understand the nature of the ecosystem, what each actor has to offer, and actually how they can best be leveraged into the organization to address that problem.

Simon Hill 18:10

So, how does that I again I think you're the well in the findings are the findings, right? And I I would be interested at how many organizations do have a dedicated versus versus do not in all of that. But equally, and I think the idea of an orchestrator and a translator is really important, but still, there's still this frustration of lots of proof of concept or lots of money going into structures that have existed for some time, right? And and maybe the missing piece is just having that really skilled individual or team of people to translate back. But actually, I think also the the lack of scaled impact could be coming from the fact that whilst innovation has a dedicated discipline, carving it too far out from the core makes it very difficult to bring the operational innovation to scale as well, right? And so, how do you see that playing out in the ever more complex world of open innovation and ecosystem collaboration as well, right?

Tom Staley 19:12

Yeah. No, it's spot on. And it's like I say, if you consider the business unit that owns the problem with the business sponsor, you know, they need to be able to work hand in hand. It's a symbiotic relationship that they need to have with the innovation team, the innovation function, the partnerships team. Um, there's a number of reasons, you know, why it's difficult to move from proof of concept or pilot into scale. Often there's no defined scale path. So whilst you might identify a business problem, you've got the sponsor, you've then got the innovation team that identifies the right ecosystem actors, you create the right environment for which through which they can understand the problem area and pursue the problem area, you know, talk about standard formats, you know, hackathons, design sprints, there's loads of different ways, you know, even through to open innovation programs or ventures types programs where you give them the opportunity to really immerse themselves in the business problem. But it's the the opportunity to scale that. And that often comes down to governance again. You know, how do you secure the funding? Um, are the commercial terms right? Are the procurement timelines right? There's often this this gap. Um, and we see orphaned pilots, you know, we see a nice POC or pilot run. Um, but then there's such a gap that either the startup hasn't been sustained through the period, um, or they move on to something else because the large organization hasn't been able to take the idea, the concepts, and then integrate it into operation, as you say. Um, and I also think there's a really important piece here around metrics and value. Organizations still largely struggle to articulate the value associated with that partnerships function or um the venture building function. And that extends to to POCs and pilots themselves. And I can see behind you your book around expected value, but this is fundamentally crucial here. We need to move away from innovation theater. Um, and and often we talk about the one idea that stuck or the one that got through. But we need to think about innovation as a system and have a systemic approach to innovation that allows startups and other parts of the ecosystem to work hand in hand with the business units and the business sponsors who have the problems, and they need a consistent way of measuring the impact and the value. And it might not necessarily be from the proof of concept which emerges and progresses, it might be from the ideas exchange, the knowledge exchange, ways in which the end user service has been customized or adapted based on the learnings from the interactions with those ecosystem partners. There's so many different aspects to the value from innovation, which helps an organization to progress and develop, but largely they're not defined in any way within an organization, which makes it difficult to often maintain that core innovation function, or it feels dislocated from the rest of the organization who's just purely measuring operational. Metrics around customer served or revenue or margins. There needs to be a larger conversation within an organization around how to measure value. And I think that'll start to unlock the ability to then scale, and we can start to address the broader governance, commercial procurement issues as well, which prevent startups in particular being embedded and scaling within larger organizations.

Simon Hill 22:25

Yeah, I was talking to someone yesterday for another episode, and she gave a great example of her time at Proctor Gamble, where in building what was ultimately a multi-billion dollar innovation, but was almost killed by the CEO because the metrics they used to evaluate things operationally suggested it would fail. And it only took a bold other person in the business to stand up and say, we're not looking at this. The metrics we're using can't apply because this isn't like our core business. But otherwise, if you're using the same judgment for the future business as the one of today, who knows how many good programs you've killed? And who knows how many bad programs you've funded? But the metrics suggest a lot on both sides of those things. So what is it that high performing organizations, you've sort of touched on bits of it, but maybe we can get quite concrete in that. What is it that high performing organizations do differently?

Tom Staley 23:14

I mean, continuing with the theme around value measurement and metrics, they they move from volume to value to impact. So they think holistically around how can they change the way in which they operate to measure value? Because that's ultimately what we want to be able to measure. If we're going to partner with somebody, if we're going to drive open innovation initiatives, we need a way of measuring that value more holistically and not considering, as you say, those more historical or legacy operational metrics. And they treat open innovation as well as as core, you know. So they are talking about ecosystem, they're talking about collaboration. We talked about how 80% now see, according to our report, open innovation as important and or mission critical. That intent needs to be translated and is translated in well-performing, high-performing organizations into a portfolio governance model that considers, you know, ecosystem operating systems. We're thinking about partner archetypes. I mentioned, you know, how you need to engage differently with a hyperscaler compared to a startup or even an academic partner, right? Um, we need to be thinking about everything from commercial to procurement and really making sure that we've got a culture that can align two often or you know, two or more very different organizations. And, you know, culture isn't necessarily something that we touched on in the conversation so far, but that's really important. And it was actually highlighted as one of the biggest barriers to success by our open innovation report. You know, culture fundamentally, I'm sure we've all heard the uh adage of uh culture, eat strategy for breakfast, is very true. It's hard to have a high-performing organizational culture that encourages experimentation and innovation. It's even harder when you're trying to do it across organizational boundaries, but having a culture to be able to experiment and align. Um and actually was interesting because it's cited as one of the hardest things to do, but it was also highlighted in the report as one of the key reasons why large organizations want to work with startups because they want exposure to their culture, because they see them as fast-paced, they see them as innovative, they see them as bringing something that they don't have. Um, and I think that's fascinating that it's kind of one of the key motivators and drivers for innovating, but also one of the biggest challenges in terms of open innovation and successful open innovation collaboration. But again, high-performing organizations think about that. They look at collaborative models and they even consider it when they're looking to enter into a partnership. It's it's it's not just about how good is the product, how good is the team, how good is the founder, it's about personal relationships. Can I work with this person? Can I work with these teams? Are our cultures aligned? Are our mission? Are our are our values aligned? These are actually really important questions to answer at the outset of any open innovation project, which which really influence the success of them.

Simon Hill 26:11

Yeah, I think it's it's a complex one, isn't it? And I I was thinking, as you were saying, like, if if culture does eat strategy for breakfast as is as is glibly purported, I think the innovation's challenge is it's it's not even invited to breakfast too often, right? It doesn't it doesn't speak to strategy too too frequently, and and therefore the culture piece, and the culture piece is complicated because you're dealing with a bunch of actors who have their own cultures and want to, you know, want to collaborate in some senses, some require it from a business model perspective, but you can't force that culture on. And I think there's still a skepticism and a cynicism a little bit from um, I guess, the the very different models of academia, research, and then startup and then corporate, right? And that sort of quadruple helix that just make it make it difficult. And I guess being honestly, why I have a slight challenge around the culture concept, not that I don't get it, I'm like, but what the hell are you gonna do with it, right? How are you gonna make that, how are you gonna make it because you can't thrust one onto the other, right? So how do you make it, how do you make those changes? Um, and maybe that digs into a little bit around leaders, right? Like what do leaders need to be doing and what do they need to stop doing to really make this possible, right? If all this is true and more exponential and more existential than ever before, and that we must be doing it. How do we make sure that in the next report we're not still, you know, still sort of turning the wheel but not really getting to value as as quickly as we we must?

Tom Staley 27:35

Because I think culture in particular is a really interesting one. You know, it's it's it's it's something you can't touch and see, it's something that you feel, right? Um, and so it often ends up being a thought experiment. So we think about how we might want to act or behave differently. Um what's really interesting is that the science shows that you can behave differently to change the way you think. And actually, that that's the way in which we should look at this. We should start thinking about the behaviors that we want individuals, teams, and organizations to portray. And you know what? That'll start to change the psyche. It will start to change the psychology and the culture within the organization. And that's something that leaders can do. Leaders can actually act differently, and by acting differently, they'll start to think differently, and that will start to pervade the team. If the team knows that they can start to experiment and explore with the latest AI models, um, they can and should be active in the ecosystem and participating and learning from other organizations, including competitors, peers. You know, there's so much opportunity to learn. And learning, I think, is the key here, right? And I talked about actually that being a key outcome, right? Or a value metric from uh open innovation and ecosystem-based collaboration, the fact that you can you can learn and these are behaviors. And actually, I think leaders can demonstrate these behaviors, they can live these behaviors, they can encourage them within their teams. And actually, even if people are slightly resistant to change, uh fearful of engaging with new tools, new approaches, if they start to, and if they're encouraged and they're given the space and the time to actually engage with these new tools and technologies, do you know what they'll start, they will start to think differently because they'll they'll understand it. Um, and I think that's that's for me, that's a really important psychological concept because it's quite easy to think that psychology and culture is a theoretical concept. But if we can start to translate culture into behaviors, then actually we can start behaving differently today. And we can demonstrate the behaviors we want as as leaders, and then that'll start to translate into the way in which organizations think and feel.

Simon Hill 29:44

Yeah, no, I I agree. I and I don't think you'll disagree with me, but I think we have to layer in incentives on top of that as well, because people are very led by the incentives. Your behaviors are aligned to your incentives more often than you will, right? We're inherently, yeah, I guess as people just just wired that way. It's like, well, you asked me to produce this outcome. Um and that's the way I'm you know measured and rewarded and bonused or whatever it might be. And so we need to keep looking at those. I think too often those incentives do not align to the things we're talking about here.

Tom Staley 30:14

Agree, agree. And I think, you know, almost at the top of the conversation, we talked about, you know, my my purpose, our purpose is aligning innovation to organizational outcomes. And we need to make sure there's this golden thread that, you know, we start with what outcome are we trying to achieve? What value are we trying to deliver? And we need to make sure not only are our initiatives, our pilots, um, our scale, our ecosystem aligned to our ability to achieve those outcome, outcomes and those values, but also that you know we're incentivizing people in the right way, that success, progression within an organization is associated with those. And that alignment, you know, that golden thread, the ability to stitch it through um at every layer of an organization, and being really clear in terms of what it is that we want to achieve, that vision, that mission, is critical. And that's not just you know, the ones and zeros, the uh number of pilots that we're going to run in a certain domain. No, it's the value associated with them. And actually, alongside that, it's the values in terms of the behaviors and the culture that we want to instill within our organization.

Simon Hill 31:27

Uh, in the in the uh podcast I recorded with um with Robin Bolton, which is a great discussion, he talks about that being the growth gap or the value gap, effectively. So if the business just trades as normal, it'll be here, but our targets are here, and there's a gap, therefore, of new value, right? And innovation is the creation of new value, and therefore the innovation it sits in that growth gap piece and say, well, what do we need to do to address that? And the reason I mention that here is because I think it's a number that people struggle with. We talked about measurement and measuring the value of the slices of the innovation pie and whether we're investing in the right things and creating the future value that we need. But I would posit that too many companies don't really know that growth gap either. What is the number, right? And to get to give a really great example of this business's growth gap was the equivalent of what at that time they were doing it was like two Facebooks. And you can't quant that, right? We don't know what you're shooting towards really in the language of what's the innovation piece we're trying to do and how realistic is it and how aligned are we to do it? Um, and I guess that somewhat leads into my my sort of semi-last question. Um, of you know, folks like what they're hearing, they come and talk to you guys. Like, what is what are the practical actions that that you're seeing you need to take in those very early days? Um, so that it's this, you know, this is a long-term piece of work, right? But there are quick actions that people can take. And so advising leaders today, what might some of those sort of three, four practical actions be?

Tom Staley 33:10

I think principally it's making sure we've got the right framework in place. You know, again, I talked in terms of my role, it's all about initially helping organizations establish innovative capacity and capability. So, how do we establish the foundations to innovate? You know, have we got the right structures in place? Have we got the right approaches, the right methods? And actually, are we focused in the right areas? How do we glean problem statements from across a large enterprise where there'll be conflicting priorities? Um, how do we start to not only understand our ability and our process to innovate, but also understand where we're going to focus our innovation efforts? That that is the foundation. That's really important for organizations to understand because then that's the basis by which you can subsequently start to actually explore, you know, you can start to then connect with the right ecosystem partners, and then you can start to actually experiment and scale, right? So if you think about that. So I'm thinking about the foundations initially, like what's the framework? Um, how do you how do you govern? How do you ensure that you have this innovative capability and capacity to drive change? Because if you haven't got that, it doesn't, it doesn't matter. It's like we're talking about when things go wrong, you might be able to then go and run a proof of concept or a pilot, but how are you going to integrate it into the organization? How are you gonna scale it? You need to be thinking about that from day one so that we avoid innovation theater, which I know that we're both we're both very passionate about. So we think about that as I suppose one key recommendation, it's that that framework, the ability to innovate. And then I think it it is about you know taking key problem areas and running at them. You know, if we've identified the right ecosystem partners to address the right or the most pertinent business challenges associated with our organization, then create the ability to innovate, right? So whatever format that might be, and there's various ways to do this, but think about how you can give those partners the real opportunity to get into the weeds of your problem statement, how they can start to solve it, how they can start to customize their assets, their knowledge, their capability to address your problem statement. So once you've got the framework in place, um, actually, you know, think about how you can run um use cases, delve into use cases and start addressing these problems. And then we talk about the concept of, you know, or the constructs that are required if we talk about an operating model. We need to think about our operating rhythms. Um so if we've established a framework at the outset, we've then started to explore different use cases or opportunities with our ecosystem. How do we get that heartbeat? How do we continue to explore new ideas? How do we ensure that we're scaling those, but that we've got a pipeline and a funnel of new opportunities and ideas? Because the world doesn't stand still and neither can our innovation function. So we need to make sure that we establish that cadence, that heartbeat, if we like, of continued governance, opportunity exploration, um, partnerships, and thinking about new models, new opportunities. So that would be my uh my three, my three, my three key recommendations, if you like, if you are an enterprise leader thinking about innovation strategy and and how to align that strategy to business objectives.

Simon Hill 36:29

Yeah, fantastic, fantastic. And we'll share a link out to the report, which I think people should you know should pick up and have a look at as well. Um, I think comparing 23, 25 is is also a good thing. So, final question then, and outside of all of that great research and great experience, um, I always like to guide people towards other places they can go to to learn as well. So any any recommendation you might have of a go-to resource book, podcast, or whatever that that that's good for you and that helps you in your journey.

Tom Staley 37:02

So I'm on my second time reading this book now. Um, so it's it's front it's front of mind. Um, but I would have to say essentialism by Greg McKeon. And I'm I'm sure you're you're familiar with that. Fantastic in terms of just maintaining focus. There is only ever limited time resource capacity, but being very clear in terms of and I think it resonates with a lot of what we've discussed during this this podcast, right? And there's an I think a very powerful graphic right at the outset of that book where we've got the circle in terms of focus, and then you know, energy comes outside of that. And if you've got 10 arrows all pointing in different directions, you can only go so far, right? You know, you're you're you're not gonna make it too far, you're too distracted. If you compound all of those arrows and point them in the same direction, you can really go a long way. You can you can really make an impact. And so I think that that theory um really sticks with me. And the example spreaded through that book in terms of how that theory has been translated into impact within many different organizational contexts, I think is really powerful. And so that's always, I think, the risk when we talk about innovation, we talk about technology waves, we can run off in so many different directions, we can run off in 10 different directions and explore different ideas, concepts across a business. I talked about those competing priorities, you know, there's there's a hundred different problem statements that need to be solved at any one time. But if we're actually going to make meaningful progress, bridge that gap that you described, how do we how do we maintain focus of the organization with scarce resources, scarce capacity, scarce knowledge? You know, open innovation is a great enabler for that because we expand all of those areas by by participating in ecosystems, but still we need to make sure that we've got focus and that we're aligned in terms of the vision and the mission that we have as a collective.

Simon Hill 38:58

Yeah, brilliant recommendation. Couldn't agree more. And I think that there's a million ideas out there, right? I I could give you another million by the end of this podcast as well. But the fit for your organization, you know, not just is this a good idea, but is it a good idea for us as a business is you know, is is key to keep reevaluating at all stages to make sure that the vast number of experiments you can now run are putting, doubling down on the ones that will are most likely to drive value with the right metrics against them, which is easier said than done, but but increasingly more structured and more capable of being done. Um, Tom, thank you. Thank you very much. I know you're juggling half-term and other things as well. So much appreciated. Um folks can find you on LinkedIn, they can find that we'll share a link to the report. Um, you also run uh uh events quite regularly as well, um, which we will share a link to that page as well afterwards for folks if you've got one coming up or not soon, but we can share some share some links to that as well. So thank you very much. Um for everyone listening. This has been a conversation, I think, deeper than just collaboration. It's about whether organizations are structurally capable and culturally capable of learning fast enough in an accelerated, AI accelerated world. The report we discussed at length here makes it very clear that collaboration alone is not the differentiator. The differentiator is how we turn collaboration into performance and performance into value. So, Tom, thanks for bringing both the research and the real world insights, honestly, to this conversation. And to everyone listening, if you found this valuable, as always, share it with someone responsible for innovation, for strategy or for AI inside your organization. Hit follow, check out some of the other podcasts I mentioned already, and there's an even more exciting one coming later in the series as well. Because innovation isn't about activity, it's about value. And as always, the question isn't whether you are innovating, it's whether it's actually working or not. Until next time, keep innovating. Thank you, everybody. What's it worth?

Outro 40:57

Uh uh, uh uh, uh uh. What's it worth? Uh uh, uh uh.