Firms today are enthusiastically forming partnerships to pursue innovation, especially in the tech sector, which moves fast with innovation as its fuel. Intermediary platforms are the primary means of developing partnerships, via which third-party APIs can be accessed and put into effective use. In addition, APIs offer the most frictionless and affordable way to integrate complex and diverse functionalities into one’s preexisting business model and services.
Platform oriented innovation partnerships can substantially impact business performance. An, overwhelming proportion of tech industry executives believes that innovation partnerships are a necessary strategy due to the cost savings, expertise enhancement, and increased flexibility they offer, whilst effectively accelerating innovation and commercialization timelines.
However, despite the presence of numerous possibilities and options to collaborate in the financial and tech space, not all collaborations yield the desired results. Legacy ways of partnership working fail to deliver major breakthroughs due to several reasons:
- Out of haste and inadequate research, companies end up choosing partners who are not a good fit
- Partner organizations set misguided goals and fail to communicate effectively to deliver requirements
- They resist sharing crucial information.
- They are change-resistant and cannot navigate unanticipated circumstances
- Legacy partnership working can be time and cost-intensive
As a result, legacy ways of approaching partnership work can often defeat the very purpose of forming a partnership. To unleash the potential of innovation, firms need to devise cost-efficient and timely ways to partner. Platforms can offer the required breeding ground for collaboration and mutual growth, through their provision of automation, statistics, AI, open innovation, and other tools to enable organizations to make the best use of available resources with the least cost and time expenditure. Certain considerations can accelerate the process further:
- Well defined rules of Engagement: Although ways of engaging may differ, trust, openness, and transparency are pillars that encourage the development of a tech-driven innovation ecosystem. Rules of engagement that incentivize data sharing, creativity and rebuilding of business models harbor organic engagement with core objectives kept in front of mind. Such engagements also have prior formalized IP and commercialization benefits allocated that value creative outcomes.
- Dispute Resolution: A system of dispute resolution ensures that parties to a partnership are treated fairly and are able to strengthen over time. Regular meetings and amicable settlement measures ensure that disputes do not interfere with ongoing innovation.
- Risk Management: Working with disruptive technologies can be challenging when one cannot be very certain of the adoption of technology, adaptability of a product, and its response from the market and customers. A platform that has carved a niche in development and marketing can help make products commercially viable at a scale that yields profit and serves the original purpose. Whilst it is better to allow participants to take risks proportional to the accrued benefits, innovative ecosystems encourage the perusal of technically risky, disruptive and rewarding products.
The use of data driven approaches and forecast models, effective agreements, risk management and settlement processes transform roadblocks from being a setback to being an opportunity for learning and growth. The push for innovation and digital transformation requires more fluidity and openness in how platforms interact within and with each other. Technical advances such as hybrid cloud services, open banking, artificial intelligence, and machine learning are modifying ways in which value propositions are developed, computational architecture is maintained, and solutions are deployed. Breaking off from siloed and legacy ways, partnership stakeholders are getting more freedom to contribute in many ways and learn from each other’s experiences and approaches.
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