Free Essay on Financing of Innovation Hubs in World-Leading Companies

Innovation is an important element of success in the business world as concerns the creation of new solutions for market needs. Innovation hubs are the new buzzwords in this sense. Every business wants to have one, and all the major organizations have one (Kurikka, 2017). An innovation hub is a space within the company that fosters innovation. It is a social workspace, community, or research center that offers knowledge and strategic innovation management, subject matter expertise and look at insights that are specific to the industry. The hubs allow knowledge transfer between the innovators and business experts in the case of the business, on the one hand, and government, industry and academia representatives on the other hand. The innovation hubs offer an avenue where decision makers can link up and brainstorm with researchers/scientists and discuss their business challenges that are complex (Gustavsen, 2011).

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Shell GameChanger

Oil and gas giant company Shell has in the recent past increasingly sourced its ideas from the public through various forums. The company created an accelerator type social investment model and called it "GameChanger." Shell GameChanger is an avenue or a platform that gives budding entrepreneurs the chance to submit proposals, innovations and ideas for the technology that could give Shell Plc an edge and advantage over other companies in areas that concern the future of energy and offer solutions to specific challenges that are relevant to the business (Dennis & Roodhart, 2011).

Shell GameChanger was started in 1996 with a mission to offer innovative options that had the ability and capacity to cause a change and impact the future of energy. Shell GameChanger has had a 10 percent success rate through the crowdsourcing initiative. Shell GameChanger works by receiving submissions electronically (online). A panel of experts then scrutinizes the submissions. If an idea is substantial and with merit, it is graduated to a larger review process that at times includes a personal demonstration. If it passes all these tests by displaying proof of concept, the GameChanger team moves the concept to a research and development process with the company's financial backing. If it meets the company's criteria, it becomes an existing line of the business, becomes a new venture, or licensed to third parties to achieve commercial market status (Bhalla, 2011).

The GameChanger approach has allowed Shell unlimited and unbridled access to new ideas and has opened it up to a global base of rising investors during a time when energy efficiency is becoming the major challenge for many energy companies. The Shell GameChanger is directly funded by its mother company and is factored in the company's budget (Dennis & Roodhart, 2011).

The Gazprom Neft Corporate Tech Innovation Hub

Similar to Shell GameChanger, Gazprom Neft Corporate Tech Innovation Hub has been started to allow and facilitate unlimited cooperation and collaboration between information technology (IT) solution providers and developers in the oil and gas sector. The hub provides the participants with a platform for testing and validating promising innovative technologies and solutions. Regular sessions are conducted at the Tech hub with the focus on the provision of new IT solutions to customers demonstrating their effectiveness and functionality (Khasanov et al., 2018).

Gazprom Neft (a Russian oil company primarily focused o gas and oil exploration and production, refining, production and sale of oil products), partnered with RVC (Russian Government fund of funds and the Development Institute of the Russian Federation) and signed a cooperation agreement that allowed for the set up of the innovation hub. The idea was to engage Russia's innovative startup community and give them an opportunity to develop themselves through the digital platform. The collaboration saw the birth of the Gazprom Neft Digital Innovation Centre/Hub (DIC) (Khasanov et al., 2018).

The collaboration means that the innovation centers although aim at providing solutions for the company, they are also aimed at helping the budding Russian innovators by providing a platform to engage and use their skills effectively. The RVC is a government fund that is involved in the building of innovation systems within Russia. Its main objective is the creation of venture capital and performing technology initiative functions of the government. The Gazprom Neft Digital Innovation Hubs is a government-funded initiative through investment from RVC funds that are aimed at growing the innovative element of the Russian people as part of government's key objectives (Khasanov et al., 2018).

Repsol Inspire Program Winners

Repsol is the major Spanish energy and oil giant based in Madrid. Inspire is an innovative programme of Repsol company that is aimed at giving university students an avenue for showcasing their skills by coming up with ways of solving disruptive problems in the energy sector. The Inspire Program collaborates by using its Campus of International Excellence in Smart Energy and other universities including; Alcala University, Extremadura University, University Rey Juan Carlos, the University of Murcia, the IMDEA energy, and CIEMAT. The idea is issuing a challenge and allowing for submission of solutions to the challenges. The best solution ultimately wins the challenge, and his/her idea can be used as the solution to the problem (Bhalla, 2011).

The inspiring program is a collaboration as said earlier between the universities and Repsol. However, funding for the innovation department in this collaboration comes from Repsol with little to no funding from the universities (Bhalla, 2011). The inspiring program is both an innovative solution to the company and some extent, serves as a form of corporate social responsibility (CSR) as it allows the members of the community (in this case universities) a chance to better themselves. The program winners get their ideas used by the company making such programs important for the development of the company (Mara, 2017).

STATOIL Innovate Challenge

Statoil, now known as Equinox is a Norwegian multinational energy company (with focus on wind and petroleum) located in Stavanger, Norway. The Statoil Innovate Challenge is a programme started by the company to be able to enhance people's innovative potential and get new ideas and innovations for meeting particular needs of the organization (Mara, 2017). The Innovate Challenge works in some way in the same way as the Repsol Inspire Program as it rewards the best among the innovators with incentives including finances, or an opportunity to work with the company.

The innovation initiative is a full company sponsored activity and is factored in the company's budgets similar to Repsol's idea. The main winners of the challenge get an opportunity to work on internship basis at Statoil and better their skills with a chance of becoming an employee and work under the research department at Statoil. The innovations are then put to work through funding from the company and are made into tangible solutions that are then used to solve the impending problems (Gustavsen, 2012).

Imagine with Orange

Imagine with Orange is an online crowdsourcing and innovation platform that aims at helping potential entrepreneurs by giving them an avenue to showcase their innovations. Orange is a multinational French mobile telephone company with many subsidiaries all over the world. Indeed, Imagine works by suggesting a theme every quarter (after three months) and invites potential innovators from all around the world to offer suggestions and ideas and post them to the site. These then go around the world where people comment and vote for the best idea. The innovators whose ideas had the most votes and were the most popular are then invited to the company's headquarters in Paris France to pitch their ideas, and the winner gets a chance to work with Orange on his/her innovation as well as other products (Kurikka, 2017).

These are all funded directly by the company although the process is not very expensive at the beginning because the costs come about when the winner is identified. Orange uses the Imagine program similar to other innovation departments stated in earlier chapters. The whole process is a company run process, and all the funding is sourced from Orange (Bhalla, 2011).

IBM Innovative Jam

IBM is the world's largest research company. The innovative jam is a period of a few days where thousands of employees are given a chance to brainstorm ideas. The idea was making use of the smart brains in the company and using them to improve the way the organization works (Gustavsen, 2012). 2006 marked the beginning of the largest extensive innovation drive by the company. The need was to speed up the launch of new technological advancements and develop ways of bringing these advances into the market. The 2006 IBM innovation jam also saw the first instance where the company used innovation and research from outside the company (Kobayashi & Yung, 2006).

The first innovative jam was fully funded by IBM to a tune of up to $ 100 million. However, after the success of the first jam, subsequent innovation jams have seen many companies come in and invest in the same to be able to tap into the ideas that are being presented. As at now, the innovation jam is a profit making element of the organization and has become part of the management systems. The innovation jam is one of the main sources of innovation ideas worldwide and has become an important and integral part of IBM research and development (Kobayashi & Yung, 2006).

References

Bhalla, G. (2011). Collaboration and Co-creation: New Platforms for Marketing and Innovation. New York, NY: Springer New York.

Dennis, R., Jones, T., & Roodhart, L. (2011). Technology Foresight: The Evolution of the Shell GameChanger Technology Futures Program. Sustaining Innovation, 153-165. doi:10.1007/978-1-4614-2077-4_11

Gustavsen, B. (2012). Social Innovation and Action Research. Challenge Social Innovation, 353-366.

Khasanov, M., Filimonova, V., Shushkov, A., & Smirnov, K. (2018). Ensuring consistent business unit involvement in new technology development and implementation: Gazprom Neft approach. Neftyanoe khozyaystvo - Oil Industry, (1), 6-11.

Kobayashi, M., & Yung, R. (2006). Tracking Topic Evolution in On-Line Postings: 2006 IBM Innovation Jam Data. Advances in Knowledge Discovery and Data Mining, 616-625.

Kurikka, J. (2017). Online Based Innovation - Online Tools and Teaching to Support Global Collaboration and Distributed Development Projects. 2017 ASEE Annual Conference & Exposition Proceedings.

Mara, W. (2017). Inside the oil industry.Oleksak, M. A., & Oleksak, M. M. (2010). Intangible capital: Putting knowledge to work in the 21st-century organization. Santa Barbara, CA: Praeger.