The latest issue of the Harvard Business Review has a great forethought on how to outsource your toughest R&D problems by HBS Prof. Karim Lakhani and Lars Bo Jeppesen from the Copenhagen Business School.
The authors analyzed all the problems that were broadcasted through Innocentive from 2001 to 2004.What they found is that on average each problem got the attention of 200 people and received 10 solutions. Other findings from their research were:
- Problems should be broadcasted to people in various fields as radical innovations often happen at the intersections of disciplines.
- Prices are necessary, but not sufficient. While people are expecting financial rewards for solving corporations’ problems, the enjoyment of taking on a novel problem was a bigger draw.
- Insiders are still important. Without it you cannot formulate your problems, nor can you assess which solutions are the best ones. So you cannot replace your internal R&D staff.