Outsourcing innovation is an exciting way to increase innovation competitiveness. Utilizing organizations like an innovation agency can allow firms to focus on other business areas. The results are increased efficiency, improved quality, faster innovation implementation, reduced innovation risk, and increased flexibility.

Outsourcing innovation can be a powerful tool to help companies speed up their growth. By understanding the risks and challenges, companies can set themselves up for success.

5 Outsourcing Models 1. Project-Based Innovation

Useful for specific projects, specialized skills, or testing out new relationships.

2. Joint Venture for Innovation

This collaboration can benefit companies wanting to share the risks and rewards associated with innovation.

3. Innovation Strategic Alliance.

Beneficial for companies wanting to combine resources and ideation expertise to create a competitive advantage.

4. Innovation Licensing Agreement.

Agreements allow access to another company's technology or expertise.

5. Innovation by Acquisition.

Allows companies to add innovation capabilities or enter a new market quickly.

Innovation Outsourcing: Successes and Failures

In Apple's work with Foxconn, it outsourced its product manufacturing. The outsourcing allowed Apple to focus on design and development, while Foxconn created innovations to produce the products. As a result, Apple could bring new products to market quickly and efficiently.

On the flip side, BlackBerry's work with TAT failed. TAT was supposed to take over UI/UX development, helping recapture market share from Apple and Android. TAT and Blackberry could not develop an operating system fast enough to keep up with the competition. BlackBerry lost market share, and both companies had to fire staff.

Keys to Successfully Outsourcing Innovation

1. Have a clear understanding of what the company wants to achieve.
2. Have a strong relationship and be able to work together effectively.
3. Ensure companies can trust each other.
4. Ensure both parties are willing to invest the necessary time and resources.
5. Look for companies with a proven track record of innovation.
6. Understand the company's business model and how it aligns with yours.
7. Understand their capabilities, including strengths, weaknesses, tools, and processes.
8. Understand their team's culture and skills.