Advantages of Leveraging the Government as an Open Innovation Partner

The need to innovate faster and more efficiently to maintain a competitive edge, we’ve seen large and small companies implement an Open Innovation model. For many, this initiative to look beyond their own four walls for ideas and complimentary technology is producing great benefits. However, many companies aren’t aware of or overlook the government as an Open Innovation partner, to their detriment.

Collaborating with the government on R&D projects is a strategic advantage that helps companies innovate more effectively and accelerate their company‘s growth. Government resources can provide companies with four key benefits: funding, technology transfer, access, and procurement opportunities.

Funding

The government is the largest supplier of research funds in the world. This year alone, the federal R&D budget is $160B. What’s exciting for industry is that the government is shifting its investments from traditional defense and health related applications and investing in sustainability and alternative fuels. More and more, government R&D investments address consumer applications rather than defense. Industries that have not traditionally tapped into government funding are seeing opportunities in a variety of forms, from economic development funds to tax credits, to ARRA grants and traditional research and development funds.
To successfully compete for funding it is important to gain access to the agency, understand how the project fits into their agenda, and differentiate it from others that will also pursue the award.

The best approach to determining whether funding is option for your company is to review all of your innovation projects or programs and see how they align with the 13 different federal agencies and the individual state agencies that award funds. Once the right organization and opportunity is targeted, your project needs to be positioned with the decision makers at that agency.

Technology Transfer

Another way to leverage the government as an innovation partner is to license cutting-edge technology from one of the many Government National Labs or work with a National Lab on a collaborative project, tapping into their highly specialized scientific talent. There is an incredible amount of technology available for licensing and the government is very interested in working with U.S. industry to help them stay globally competitive and keep our economy strong.

A good place to find what technology is available for transfer is the Federal Laboratory Consortium for Technology Transfer (FLC) website. More than 250 federal laboratories are members of the Consortium and the FLC website offers a wealth of information on each lab’s mission, areas of expertise and the contact person for technology transfer inquiries.

Procurement

The U.S. government is one of the largest consumers of products and services in the world. From food, transportation, computer supplies, paper, and clothing to defense and medical products, the government has some tremendous purchasing power. The government also invests more in tough economic times. By opening a new sales channel with the government it is possible to balance the up and downs in the commercial market.

An additional benefit is, it’s much easier to make an R&D investment decision if you know you have a customer waiting in the wings to buy. As P.J. Dougherty, Vice President of SMI Inc./Helios Strategies says, “Leveraging the Department of Defense to buy technology as a first customer is a great way to mitigate risk.”
Landing a government contract for procurement can also help companies introduce new technology into the marketplace earlier. The government has a series of green mandates that require them to procure “green technology” over other alternatives. For example, there is a mandate that every ground vehicle in the department of defense use biodiesel. This has not been embraced by the commercial world and therefore it allows biodiesel additive companies to sell their products sooner rather than later.

Access

Our clients are surprised by how much value they get out of applying for an open solicitation to receive funding. Access to the agency executives and key policy makers has been worth its weight in gold to refine technology value propositions. Dan Coughlin, a Program Manager at ITECS says “Agencies have access to best practice information. A company will find that their early stage ideas are honed to a greater degree and get sharpened when working with the government.”

The government sponsors technology workshops in certain industries where they bring in experts to discuss technological needs. The discussions at these forums can define which direction an industry takes for technology development or provide valuable insight to companies on where to put your innovation dollars.

Bottom line, creating a long term relationship with the government as an innovation partner is a tremendous way to mitigate risk for R&D projects to keep your company growing and innovating. By providing funding, specialized technology, serving as a sounding board, and in some cases as a first customer, a collaborative relationship with the government is your best investment decision yet.

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Susan Ward is the Founder and CEO of ITECS Innovative Consulting, which has secured over $145MM from the government to help Universities, non-profits and the F1000 fund, develop and commercialize technologies. Check out the latest funding opportunities or to visit the website.