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Is the food industry really open to innovation?

Nestlé has HENRi, General Mills has G-WIN and Kraft Foods has NineSigma. But despite the food industry’s apparent embrace of open innovation platforms, challenges remain.

Over the past decade, open innovation has become an increasingly important strategy for most major food and drink companies. Most recognise the importance of tapping into the widest possible pool of research talent. But the concept is still problematic, says Dr Volker Spitzer, Global Principal of Consumer Health R&D at IQVIA.

Speaking at the Future of Nutrition conference 2018 in Frankfurt, he outlined continuing challenges. Among those are difficulties agreeing rights to intellectual property, legal complexity, and balancing the relative negotiating power of the parties involved. Above all, however, corporate culture is often the most difficult barrier to overcome, particularly as employees may be resistant to ideas from outside sources.

“Not-invented-here syndrome’ is a big problem when you have scientists working for you who have done things the same way for decades. Most have had a lot of success with that way of working,” he said.

Embedding open innovation in corporate strategy

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Potential solutions could involve hiring an independent negotiator or issuing a letter of intent to pre-empt IP concerns. Ensuring the company’s approach is well-defined and agreed by all parties from the start is also effective.

“You have to embed open innovation in your corporate strategy and come from the top down,” Spitzer said. “You need efficient and effective knowledge management systems.”

Adrian Percy, Ag Technology Ambassador for Bayer Crop Science, said it was even possible to work with competitors on joint projects if the brief is well-defined and everyone has a good understanding of the other company’s expectations.

“We are doing larger collaborations with competitors sometimes where we will share licenses around the world,” he said.

Adrian Percy explained that it was important to be able to take a step back and objectively consider potential external solutions. Even if that means having to shut down an internal project.

For a giant organisation like Bayer, however, working with smaller companies can be especially beneficial.

“We have to compete with entrepreneurs to bring new ideas into the company,” he said. “Smaller, more nimble companies working on cutting-edge science are very good for us to work with. But there are challenges on both sides.”

No matter what the size of the collaborating partner, understanding expectations is crucial. Although it is also important to be open to new ideas that could arise from a partnership.

“Benefits are access to new ideas and new technologies, but sometimes access to things we didn’t even know we needed,” Percy said. “It can be dangerous to be too prescriptive about what you are looking for.”

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