This article talks about the evolution over the past several decades from closed to open innovation. It defines the new approaches to innovation and how customers depend on others for their R&D innovation. The author says, “Open innovation 2.0 is now emerging, blurring the lines between universities, industry, governments and communities. It exploits disruptive technologies, such as cloud computing, the Internet of Things and big data, to solve societal challenges sustainably and profitably, and more quickly and ably than before …”
This is an interesting article and we highly recommend reading, Twelve Principles for Open Innovation 2.0. As the article states, there are not many pure innovation labs that take the risk and innovate and let others take advantage of what they create. This puts an extra burden on service providers to be the leaders rather than followers with their customers.
More and more customers will engage in outsourcing agreements where innovation will be a key delivery and success factors. How are we preparing to address these changes? Will we need new contractual terms so that there is adequate compensation for providers to innovate? What role will governance play?
Users of free open source software are creating more innovation than the suppliers, according to this article quoting Red Hat’s CEO. “Almost all of the innovation in machine learning and other areas of emerging IT are the result of large IT users solving their own problems,” the article says. Software containers, which allow pieces of applications to be distributed across any sort of device, are viewed as a way to reduce the cost of running software and make software developers more efficient.
This article about innovation and advancement in software creation should catch the attention of both providers and customers of software outsourcing services. The use of techniques such as “containers” and “machine learning” is becoming more common, reducing cycle time for software creation. It is going to demand that end users have higher control over content and an expectation of “quick” delivery.
Traditional software outsourcing service providers need to be ahead of this curve or some of the upstart players will take control of the market. This will raise questions about who is responsible for defining development methodology – customersor providers. How will customers determine whether innovation was engaged in the delivery of the software?