Defining Innovation as a Service

Innovation as a Service (IaaS) is an emerging business model that provides innovation as an on-demand, subscription-based service rather than a one-off project or function. Through IaaS, companies can tap into an external network of innovators, researchers, and idea generators on an ongoing basis to continuously develop and deliver new products, services and business models. IaaS helps foster a culture of innovation that is sustained over time rather than occurring in isolated sporadic bursts.

At its core, Innovation as a Service aims to make innovation more accessible, affordable and achievable for companies of any size. By outsourcing the innovation process to specialized service providers, customers can benefit from innovation without having to fully invest in building internal capabilities, infrastructure and human capital from scratch. IaaS takes many of the risks out of innovation by offering innovation help on an as-needed, pay-per-use subscription model.

Key Components of an Innovation as a Service Model

While IaaS models may vary between providers, most incorporate some common framework and service elements:

- Idea Generation: Brainstorming new ideas for products, services, business models, workflows, customer experiences and more through techniques like design thinking workshops, crowdsourcing, consumer insights analysis etc.

- Idea Screening and Selection: Evaluating ideas based on feasibility, fit with business/mission, market needs etc. and selecting the most promising concepts to pursue further.

- Prototyping and Piloting: Rapidly developing minimum viable products or pilots for selected ideas and testing them with target audiences to gather feedback before further development.

- Implementation Support: Guiding selected ideas through the implementation process with support activities like project planning, resource coordination, change management etc.

- Continued Improvement: Facilitating ongoing ideation, refinement and iteration even after initial implementation to keep fostering innovation as part of everyday operations.

- Platform Access: Providing the hardware infrastructure, software tools and workspaces needed to support collaborative innovation processes remotely.

- Innovation Skills Training: Upskilling client personnel in innovation methodologies, design thinking, rapid prototyping techniques etc. through curated skills development programs.

Benefits of the Innovation as a Service Model

For companies, the IaaS model offers several key strategic and financial benefits compared to trying to innovate on their own:

- Lower Costs and Capex: IaaS subscription fees can be significantly lower than the ongoing costs required to establish and staff an in-house innovation program. There is no large upfront investment needed either.

- Access to Expertise: IaaS providers employ experienced innovation specialists, researchers and cross-disciplinary talent that may not be feasible for clients to hire directly. This external expertise acts as a force multiplier.

- Scalability: Since IaaS is delivered remotely through a services model, clients can quickly scale up or down their innovation bandwidth based on needs without making long-term resourcing commitments.

- Risk Mitigation: Trying unproven ideas on a subscription basis with smaller initial investments reduces financial risks compared to fully funding uncertain innovation projects internally.

- Focus on Core Business: By outsourcing non-core innovation activities, clients can dedicate more time and resources to growing their existing operations rather than stretching efforts across disparate functions.

- Agility and Speed: IaaS providers are set up specifically to rapidly set up experiments, gather insights and iterate on new ideas far more quickly than isolated in-house efforts allow for.

- Benchmarking: Through aggregated learnings across diverse client portfolios, IaaS providers gain valuable benchmark data and best practices that can be used to continually enhance the innovation process.

Key Considerations When Evaluating IaaS Providers

While the IaaS model presents clear value, there are also considerations for companies looking to engage innovation partners:

- Domain Expertise: Choose providers with relevant experience in your industry to best leverage contextual knowledge and apply learnings to real business problems.

- Track Record: Give preference to IaaS providers that can demonstrate successful case studies and quantifiable impact like new products launched, revenue growth attributed etc.

- Service Scope: Evaluate if the provider supports your required areas of focus end-to-end or if additional partners may be needed to fully cover the innovation process.

- Cultural Fit: Consider how aligned a potential partner's work culture and methodology are with your company values to ensure cooperation.

- Security and Governance: Understand the provider's protocols for data protection, confidentiality of intellectual property and compliance with industry regulations.

- Pricing Transparency: Ensure fee structures, terms of engagement and expectations are clearly defined upfront to avoid ambiguities down the line.

- Relationship Management: Inquire about processes for ongoing collaboration like reviews, reporting and relationship points-of-contact for smooth coordination.

In conclusion, Innovation as a Service is emerging as a promising new approach that can help organizations innovate more consistently and cost-effectively by tapping