Cross-industry innovation in health care sector
Over the past decade, collaborations across industry boundaries have become increasingly popular in the corporate world. Cross-industry innovation (CII) describes the systematic incorporation of knowledge, concepts or technologies from more or less distant industries into a company’s innovation process. Through CII, firms are able to foster product, service or even business model innovation.
CII assists firms in cutting down uncertainty and risk in their innovation processes, because the solutions and technologies it introduces have already worked successfully in a different market.
Used primarily in the development of new products, CII is an attractive method for generating both radical and incremental innovations.
The CII process can be defined as:
- Abstracting a problem uncoupled from the company’s own industry
- Finding solutions to this problem through analogies in foreign industries
- Transferring these analogies in a way that is applicable in the company’s own industry
Prior research suggests that firms are able either to enhance a product’s novelty value (e.g., create more radical innovations) or increase effectiveness via CII initiatives. Since a specific solution or technology has already worked successfully in a different market, firms are able to cut down uncertainty and risk in their innovation processes.
Strict laws and regulations in the health care sector can lead to various challenges. Firms in this sector are often forced to achieve two simultaneous objectives: an increase in innovation novelty as well as an increase in efficiency. CII is a logical step in achieving these goals, because differences in the mindsets of cross-industry partners might expand views beyond a firm’s horizon. In order to analyze CII in the health care sector, we interviewed seven companies and conducted a multiple case study analysis.
We found that firms within the health care sector require unique organizational capabilities to create cross-industry products, services or even conduct business model imitation across industry boundaries. Several health care firms that we studied identified automotive and aviation as lead industries for the regular transfer of technologies, processes and even business models. Furthermore, scouting and screening initiatives need to be promoted beyond the health care sector, because otherwise an increase in the products’ novelty value and the introduction of new trends in the health care sector are quite unlikely.
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