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Monday, December 4, 2023

What is the process of starting a new business through collaboration? How to step up the stages of open innovation is also explained.

We would like to promote new business through open innovation, but what process should we follow to achieve the greatest benefits for our company? This is a common concern when collaborating with an external party for the first time. This may be a natural concern since the collaboration is between people from different cultures.
This article will introduce the process and methods of starting a new business through collaboration and how to step up the stage of open innovation in your company so that even those considering open innovation for the first time can understand the process.
Table of Contents
What are the six processes for advancing new business?
Three methods to collaborate with other companies and when to introduce them
Open innovation stages and how to step up to the next level
Step up open innovation by continuing new business

What are the six processes for advancing new business?

Generally speaking, new businesses need to proceed with the followingSix circulating processesThe process is to be continued. If you find issues along the way that do not work out, go back to the process that caused the issues and start the process over again. It is necessary to have a common understanding of this process with the partner with whom you are collaborating.

1. Research and Idea Gathering

Research the characteristics of the market and possible future changes. In particular, we will research the "How many consumers will be involved and how much money will be spent?Marketability and "such asWhat kind of person would buy it and for what price?Research business opportunities such as

It is also essential to research competitor trends and market maturity. Once we have completed our research, we gather ideas for people, goods, and money to develop a business plan.

2. Business plan development

Develop a business plan based on research and collected ideas. Uphold the mission of the business,What type of business will be conducted, what resources will be utilized, what are the threats to the business, and what are the countermeasures?The following are some of the details that should be considered and drafted.

It is important to consider at this stage if you intend to use grants for funding or to receive equity investment.

3. Evaluation of business plan

Is it a viable business, is the market size commensurate with the investment in the business, and what is the value of this company doing this business?Evaluate your business plan based on the following factors. If the project is not implemented at this point, go back to the initial research and restart the project.

4. Raising funds and securing members

defined in the business plan.Ensure members have the necessary skillsThe funds will be used to finance the startup and immediate operation of the business.

5. Development and servicing

From this point, the investment of management resources into the business will proceed in earnest. Once the business is launched, aim to make the business profitable while following the business plan. This is also related to valuation,Requirements for withdrawal in the event of non-monetization are also established in advance and confirmed with the collaboration partner.It is important to do so.

6. Evaluation

While moving forward with the business,Constant identification, analysis, and evaluation of gaps between business plans and actual operationsThen, make improvements and revisions as needed. Each time you make improvements or modifications, cycle the process back to the idea gathering process.

Three methods of collaborating with other companies and when to introduce them

One of the most typical methods of open innovation is the "Corporate Accelerator Program"mergers and acquisitions"Corporate Venture Capital (CVC)There are three types of "new businesses". Each of them has different timing and which of the processes to introduce into a new business depending on its characteristics. Select the one best suited to the nature and purpose of your business.

Corporate Accelerator Program

with know-howA method for major companies and local governments to collaborate with start-ups to create businessesIt is. The research is done by the startup company, and the collaboration begins from the timing of collecting ideas for the business plan. The startup with the seeds of the business and the major company with the resources of commercialization know-how and funds complement each other.

mergers and acquisitions

A method of acquiring or merging with a start-up company to bring into the company the management resources it lacks or the business itself that has been launched.It is. This is done when the startup company begins to raise funds. In addition to the transfer of shares from the startup company to the M&A company, a cross-shareholding joint venture may be established.

Corporate Venture Capital (CVC)

This is a method in which a company invests indirectly by creating a fund with its own funds in startup companies that have the potential to generate synergies with its own business.While M&A is a method that involves management, CVC is a method that only aims to utilize the technology owned by the company in which it invests.It can be said that

If this approach is taken, the collaboration can begin at any point in the process of advancing the new business. However, from the startup company's point of view, it may be better to start collaboration later in the process, as they may have a better structure in place to prevent the business from becoming one that only benefits the company conducting the CVC.

Stages of open innovation and how to step up

The stages of open innovation in a company include the degree of growth of7 StagesThere are

Seven Stages of Open Innovation

The goal setting for new business should not be based on the number of new businesses created, but on the step up in stage.

Stage.0 "There is a sense of crisis in the current situation, but nothing has been done yet."
Stage.1 "The company is considering but not yet implementing co-creation, such as information gathering.
Stage.2 "Co-creation has begun with outside help, etc."
Stage.3 "A state of continuous co-creation based on experience and know-how"
Stage.4 "A state in which the company can strategically co-create on its own.
Stage.5 "A state in which the company is capable of co-creation and investment on its own.
Stage.6 "A state in which the culture is rooted in a system in which new innovations are created one after another."
Stage.7 "State to be a subject of challenge utilizing social resources beyond the boundaries of the enterprise."

You can read more about it in this article.

How to step up?

Step up the stage by repeating the cycle of the new business process and continuing open innovationto be able to do so. Once a new business is done through open innovation, it is around Stage.2 in the seven stages, and it is not a climate for innovation.

By tolerating failure and continuing to challenge ourselves while learning from our mistakes, we will step up to an environment where innovation is born one after another.

Step up open innovation by continuing new business

This article introduced the process and methodology of starting a new business through open innovation and goal setting.

Important,To place goal setting at the step up of the open innovation stage and to cycle through the new business process.It is. The experience gained from a small new business can grow into a large business.

Why not aim for major innovations that occur in large numbers by repeating new business through open innovation?

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