It seems that talking to your business rival is not such a bad idea, writes OLIVE KEOGH

SITTING DOWN for a cosy chat with one’s competitors is not the Irish way of doing business. Perhaps it should be, though, according to Per Kokholm Sorensen, director of electronic RD at Widex, a high-tech Danish company at the cutting edge of hearing-aid technology.

“We meet our main competitors three or four times a year and discuss emerging trends and issues and it is very useful,” he says. “We also pool resources to fund research in common areas.”

Sorensen was speaking at a seminar organised by the embassies of Denmark and Sweden and by the Dublin Institute of Technology (DIT) on Innovation: Practice from Policy.

“We thought it would be interesting to look at what lessons we could learn from Sweden and Denmark in identifying common themes for promoting innovation within existing enterprises in an Irish context,” says Robert Simpson of DIT.

Sorensen describes how Widex’s close links with third-level institutions have contributed to the company’s success in developing innovative practices, processes and products. Widex collaborates regularly with third-level institutions and funds a range of research projects.

“We are close to the best ideas and to the best engineers and this has proved very valuable,” Sorensen says.

Widex is a family-owned company with turnover of €300 million and 2,400 employees. “Being privately owned has its advantages when it comes to fostering innovation,” Sorensen says. “We take innovation very seriously and can give it time to happen because we do not face the same commercial pressures to deliver results.”

The company operates an ideas database to which all employees can contribute. Ideas are reviewed monthly by management and rated according to their potential to succeed. The best are passed to multidisciplinary innovation groups who study them in depth before making a presentation to the senior management team.

Collaboration was also a key factor in the formation of Swedish food company, Oatly, in the 1990s. Its founder, academic and scientist Rickard Oste, was part of a “think tank” of agri-food producers in southern Sweden who got together to generate ideas for new products.

“There were a lot of informal meetings and many problems and possibilities were discussed,” Sorensen says. “From this group there eventually came new products, new technologies and new companies.”

One of the crops in abundant supply in the area was oats. Oste, who had an academic interest in lactose intolerance, saw the possibilities of developing a range of oat- based dairy substitutes such as milk, ice cream and smoothies. He set up Oatly to pursue this idea and his company’s products are now sold in 20 countries.

“I think a mistake people make is to assume innovation happens quickly,” Oste says. “Perhaps it does at times but in my experience, it requires long-term engagement, particularly by those funding it, such as venture capital companies. It is simply not realistic for someone to expect their money back in three years. A far more likely timeframe is seven to 10 years.”

Oste, who now combines his business and academic lives, endorses Sorensen’s view on the value of multidisciplinary academic and business link-ups from an innovation perspective.

However, he gives another more tongue-in-cheek reason why link- ups can be a good idea. “In my experience from a PR perspective, if a university sends out information about a new product or service, people are inclined to believe it. This is less so if the information comes from a private company.”

Jorgen Rosted, a director of Fora, (a research institute that falls under the remit of the Danish ministry of economic and business affairs), says: “We need technology 100 per cent, but as an enabler of innovation, not as its driver. As time goes on, there will be an increasingly global market for technology – it will be easy enough to get it. Where companies will succeed or fail is in how they use it.”

Pat Branigan, senior innovation adviser with Enterprise Ireland, warns companies about the pitfalls of innovation brainstorming in a vacuum. “It’s about more than the idea,” he says. “It is as much about picking the right projects to back and then delivering the product or service right first time in a cost-effective manner.

“Also, innovation does not reside in RD alone. It is also about working leaner and smarter and changing the culture or mentality of an organisation if it needs to be changed in order for the organisation to be open to new possibilities,” Branigan adds.

“One of the phrases most commonly heard when people try to introduce new ideas or methods is ‘we don’t do things like that around here’ – that kind of mindset is death to innovation.”