Believe it or not, healthcare innovation is still in its infancy. Weâ€™re bound to see the explosion of new products, technologies, apps, and business models continue in healthcare as entrepreneurs generate new ideas, create new markets, and adapt to changing market and customer demands.
With that said, would you be surprised to know that studies show for every 3,000 new-innovation ideas, only one reaches commercial success? Yikes! Many innovators fail because they donâ€™t fully understand the commercialization of innovation (CoI) process.
8 Dimensions of Commercial Success
We want to help. Our series on the 8 Dimensions of Commercial Success addresses the eight strategic and tactical concepts of the CoI process and sheds light on strategies every entrepreneur needs to consider if they want to generate an ROI on the innovation.
Today weâ€™re talking about the power of partnerships and alliances. Regardless of size, innovating firms are rarely capable of successfully commercializing a new product on their own and often seek commercialization partners. These network relationships serve two main purposes: supplement resources and foster adoption. Partnerships and alliances might include (a) customers, (b) suppliers, (c) distributors, (d) media, (e) research institutes, (f) policy makers, (g) opinion leaders, and (h) investors.
Supplementing Resources for New or Small Firms
For new or small firms, resources are often limited and these innovators generally rely on external relationships to augment this resource deficiency. If youâ€™re a start-up or smaller company, seek out well-known partners because they offer you legitimacy and credibility. Business leaders who procure the right combination of network relationships gain a competitive advantage and are well-positioned for market acceptance.
Strategic vs. Tactical Partnerships & Alliances
Strategic partnerships and alliances are built sooner, well before launch; while tactical partnerships and alliances are most valuable during the distribution and advertising phases. If your innovation is compatible with existing technologies, we encourage you to explore relationships with these companies. These strategic partnerships can be a catalyst for integrating your innovation into an already-saturated market.
Even before your innovation is ready to launch, networking is essential for the diffusion of any new product or service. This is especially true for technological innovations, as these are first released into a niche, tight-knit environment. Weâ€™ve all heard the age-old adage, â€śItâ€™s not what you know, itâ€™s who you know.â€ť This still rings true. Gaining positive acceptance among key influencers in the adoption network is critical for diffusing your innovation. Itâ€™s not important to have close relationships with all the key players in your industry â€“ but it sure helps!
Early Adopter Relationships
Among the most important types of inter-firm relationships are those early adopters and other key opinion leaders who establish a positive attitude toward your innovation. Network relationships are complex, dynamic, and either form strong or weak connections. Different types of innovations, such as radical innovations or autonomous innovations, require different types of connections, so be sure to understand what type of innovation youâ€™ve developed. Gaining network support before the innovation diffuses in an important factor in your targeting strategy too.
Keep Your Friends Close and Your â€śEnemiesâ€ť Closer
Itâ€™s a common mindset for innovators to keep their systems, software, and complementary hardware completely proprietary. After all, why should I share the fruits of my labor with my competitors? Surprisingly, research shows that this mentality can be fatal for a launching innovation.
By keeping your licenses and development tools proprietary, youâ€™re shutting the door to support opportunities. Youâ€™re â€ścutting tiesâ€ť with entities that can help your innovation evolve and assimilate into the marketplace. By isolating your innovation, it becomes that much harder to achieve your ultimate goal of successful commercialization. In the end, business leaders who form the best partnerships and alliances for their firm become the most successful.
In our next installment of the 8 Dimensions of Commercial Success series, weâ€™ll look at considerations for distributing your innovation. If you missed the previous posts from this series, you can check them out here: Making Sure Your Healthcare Innovation Doesnâ€™t Flop, Sometimes Innovators Lose and Followers Win: Why Timing Is (and Isnâ€™t) Everything, and You Have an Amazing New Healthcare Innovation, Now What?
Interested in learning more about how partnerships and alliances fit in to your overall innovation and go-to-market process? If so, contact Roxie Mooney at roxie@legacy-DNA.com.