Five Steps to Unlocking
Russian Innovation for Your Company
compete in today’s business world, innovation is key. Unfortunately,
few companies do innovation well. In fact, according to one survey
of 40 companies with revenues of over $1 billion, only a meager 5%
has been able to build an innovation funnel that continuously
produces innovative growth as a result of innovation-focused
companies are already familiar with the concept of looking overseas
for the things their company is lacking, such as employees,
technology, and information. But how about innovation? Can companies
look to other countries for innovation? Yes. And the country to look
to is Russia.
most people don’t think of Russia for innovation, the fact is that
Russia offers a great source of novel approaches for business.
Already, companies like Xerox, Samsung, BP, IBM, Intel, and others
have proven that Russian ingenuity can be tapped—and for substantial
financial gain. For example, Xerox adopted a Russian technology that
enabled the company to produce toner cartridges eight times faster
Russia being a source of innovation should not come as a surprise.
After all, it is a country of nearly 100% literacy, with a
scientific community of an estimated million mathematicians,
physicists, and engineers who, in the past, were able to create
breakthrough advances in space travel, quantum physics, high
temperature superconductivity, optics, organic and physical
chemistry, nuclear weapons, and supersonic jets. In addition,
Russian scientists have long worked in environments where
breakthrough results were demanded from small investments. These
demands have grown a culture of “out of the box” thinking, resulting
in elegant and surprising solutions.
unlocking Russian innovation for use by Western companies is not
easy. Language, cultural, and communication barriers stand in the
way. The following suggestions will help you tap into all that
Russia has to offer.
Find an experienced local partner: Identifying innovative
technologies in Russia on your own is not an easy task. Many Russian
researchers take a guarded and skeptical position toward working
with foreign companies. Additionally, you can’t expect just “any”
Russian engineer to find the technologies and innovations you
desire. You have to teach them advanced innovation scouting
discipline and methods. Then you have the issue of licensing or
transferring the technology or innovation to the US. That’s why you
need a skilled local partner to guide and manage the process. The
partner you choose needs to have specific competencies: deep
knowledge of both cultures at the senior executive level and
extensive experience in technology identification and transfer
Start with a problem statement: According to Peter Drucker,
technology innovation is the riskiest and the longest path to
fruition. Often, new markets need to be created and new customer
behaviors developed. Yet, most companies pursue exactly this
difficult and risky path. A better approach is to develop several
well focused “problem statements”—concise statements about areas
where your company could achieve significant market differentiation
if a technology was available. A problem statement can be a gap in
the product portfolio or a technology limitation for a new market
entry or a constraint in the manufacturing process. Make sure your
problem statements are broad enough so they can be solved in a
number of ways with potentially different technological approaches.
At the same time, they need to be specific enough to tightly define
a market need that was not addressable with the current technical
state of the art. A good problem statement is not prescriptive from
the technology point of view.
Look for demonstrated technologies: Initially it will be
tempting to listen to proposals presenting completely new
theoretical ideas about how to solve the problem. Realize, though,
that your company’s overall effort will not go far in terms of
business impact if you pursue the practice of funding “raw” ideas.
To be successful at tapping into Russian innovation, only consider
demonstrated technologies. These technologies might be in a
different application or might only solve the problem partially, but
they need to be more than someone’s brilliant idea.
Work with innovators who can deliver on the promises: If you
spend time with innovators who cannot complete a technology
evaluation project, you are wasting your time. Working with your
local partner, institute a discipline of qualifying researchers
based on their track record. Then, only invite innovators who are
known to have delivered results. This is where having a local
partner is crucial. In Russia, even though reference checking
exists, references routinely misrepresent information during
reference checking interviews. There are many cultural reasons for
this phenomenon but, nonetheless, the information collected is often
garbage. In Russia, only “deep reference checking” has value. In
order to get an honest answer you have to go to people you trust and
who trust you. Having access to a network of people who can provide
honest references is a necessary component to success.
Measure and manage the process: The overall process consists of
five major steps: scouting, screening, quick verification, in-depth
evaluation with one to three phases, and transfer to operations. The
scouting and screening steps should be performed by your local
partner who will be adept at maneuvering through the Russian
environment. If a technology is of interest, structure a quick
verification project. These should be fast and low-cost. The intent
is to quickly verify the technology’s performance in a particular
application or to demonstrate a particular capability. A technology
transitions into an in-depth evaluation project when it is
determined that the technology has a significant business impact
potential. At this point sufficient commercialization potential had
been demonstrated so that the risk of further required development
is minimized. No invention is required and all uncertainties are
identified. Only then should you transfer the project to operations.
successful, you need to develop a clear definition of what the
project is trying to achieve at each step of the process. To do so,
answer the following questions:
is the objective?
are the various constraints?
are the assumptions?
clarity of the overall process and of specific project objectives is
one of the most critical parameters of success. When you define
project success upfront, results are easy to measure and the project
almost manages itself.
Create an Innovation Funnel of Russian Technologies: In a world
in which some claim that America is losing its innovation edge, the
ability of US companies to develop innovation internally and
identify it around the world is becoming increasingly critical to
survival. Russia offers a rare combination of novel approaches, deep
scientific knowledge across many disciplines, ingenuity in creating
solutions, and the breadth of skills. In order to successfully
innovate in the future, companies will need to turn to Russia for
unique approaches. Being aware of critical success factors and ways
to ensure them will differentiate winners from losers in the
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