This September, we’ve decided to take our theme to new heights by talking about a relatively uncommon — though not exactly new — practice of innovation and what it means for competitive advantage: “open innovation.” Essentially, open innovation is the practice of merging your internal assets and resources with those outside of your organization, in order to get the best value from what you have and what’s out there.

Sometimes that means sharing talent and ideas with another company, but often it can be the practice of actively capitalizing on the nearly limitless knowledge of the world, to increase things like shareholder value, customer satisfaction, and even product engineering and development methods.

Early to Risk, Early to Rise

It’s safe to say that we’ve all been at least exposed to — if not bludgeoned with — the idea that greater risks lead to greater rewards (when they don’t completely fail, that is). That said, these should be calculated risks built on strategy, with more than just some cursory market knowledge thrown in. You can’t just tell people to go forth and innovate openly; as important as things like ownership and autonomy are, accountability is difficult to measure without some type of expectation to measure against. Plus, if open innovation is a new venture, employees without positional authority are unlikely to feel comfortable reaching outside of the company congregation. Leaders have to be at the helm of developing and implementing goals.

Still, the fact that open innovation is a risk for most companies means you might not reach those goals right away. But, as is typical in the early stages of any new approach, it’s much more important to build a culture than demand immediate, concrete results. The practice of open innovation is about transforming connections across companies and other entities into a vision, and then using tactical application to bring that vision to life.

The Innovation Hub

Truth be told, time-tested systematic approaches to innovation just aren’t working anymore. They’re not enough, which is exactly why reaching beyond the realm of internal resources can be so beneficial. Truly open innovation models are rare, though, despite the fact that we currently have access to endless data and talent through analytics and social networks. However, creating an “innovation hub” can get you started with an actionable framework that seems a lot less scary than the ambiguous notion of company partnering (sounds like a mind map to us, you guys). The folks over at Innovation Excellence note that, for an open innovation hub to work, “leaders [must] combine technical know-how with commercial sense.” Eloquently put, and important for any organization who wants to take the following hub-creation steps to heart:

“The five steps of creating an innovation hub are ‘want, find, assess, get, and transition.’ You start with a tight brief, with a defined innovation strategy of the [partnering] company, to be clear about what you want and what your specific requirements are; you find interesting assets externally, you assess them, you ‘get’ them by structuring term sheets, and then you transition them into the company.”

The idea of open innovation can be a little intimidating — after all, sharing isn’t always caring in the business arena — and the first step is always the hardest to take. But when it’s done right, innovating openly through B2B collaboration can be the difference between competitive advantage and competitor takeover.