Feature Articles: Global Research and Development Activities by the NTT Group Open Innovation Strategy Pursued by NTT DATA Italy Giorgio Scarpelli Abstract NTT DATA Italy is adopting an open innovation strategy and pursuing collaboration with clients, universities, and startups. The company is focusing particularly on innovation with clients and utilizing an idea management platform called IdeaHUB, where employees with good ideas can post their ideas and gain feedback on them. This article introduces these research and development activities. Keywords: global, innovation, R&D 1. NTT DATA Italy open innovation model find the support to realize them. Such a network of relations is what we call open innovation, a kind of NTT DATA Italy is pursuing an open innovation distributed collective genius in which several stake- strategy aiming to master the big shift we are experi- holders, including customers, are part of. By offering encing nowadays, characterized by several revolu- our customers the possibility to actively enter the tions—all driven by technology—that are happening ecosystem and to enable direct and indirect collabo- together at the same time. ration with universities and startups, in addition to Innovation is not just related to ideas, as ideas that our internal capabilities and labs, we make our open just stay in labs or universities are not innovation, innovation model a key business enabler. We call this they are just ideas. Innovation is more complex. It is the Innovation Empowerment Model (Fig. 1). the way we bring ideas to reality, turning ideas into something real and useful, failing and retrying, start- ing from a need and finding an answer. The capability to turn creativity into reality is the key to make the most from innovation, but everything starts from ideas, and in a hyper-connected world, both ideas and Clients capabilities are everywhere. For this reason, we are committed to finding ideas and niche capabilities to turn into reality and bring to the market. Universities Startups Therefore, innovation is the capability to transform R&D centers ambitious ideas into tomorrow’s solutions. It involves Innovation technology and research and development (R&D), of Empowerment course, but includes much more: intuition, vision, Model ability to execute, all supported by passion and cour- age. All of this is expressed in an ecosystem that NTT labs, Employee values perspectives and approaches outside our com- Global R&D/ engagement fort zone. local labs This capability is substantiated by the network of relationships, collaborations, and shared efforts that produce the ideal context to imagine new things and Fig. 1. Innovation Empowerment Model. NTT Technical Review Vol. 16 No. 10 Oct. 2018 29 Feature Articles Politecnico di Milano Milan Humanitas University CUOA Foundation University of Milano-Bicocca University of Bologna POLI.design Treviso − Experience design − IoT − Emotional technologies − Blockchain Turin − Blockchain − Experience design − Sport medicine Pisa Sapienza University of Rome Rome University of Turin Roma Tre University University of Eastern Piedmont Naples A.O.U. Citta della Salute e della − Cybersecurity Scienza di Torino − AI Cosenza OCR / − AI Dematerialization Applied to automotive, insurance, healthcare sectors University of Calabria University of Pisa − AI Machine learning / Deep The University of Naples Federico II − Synthetic reality learning Parthenope University of Naples Immersive experience − Blockchain − Robotics − AI − IoT / Embedded systems Industrial / Healthcare Image recognition − Precision life science − Cybersecurity − Cybersecurity AI: artificial intelligence IoT: Internet of Things OCR: optical character recognition Fig. 2. Collaboration with universities in Italy. 2. Collaboration with universities • Post-graduate master’s degrees We are leveraging the presence we have in the Universities represent one of the main actors in the entire Italian territory to strengthen collaborations open innovation ecosystem. Maintaining relations with the local university ecosystem, focusing each with them is one of the most relevant success factors area on a peculiar innovation domain (Fig. 2). in our strategy, for several reasons: • Being connected with talented resources 3. Collaboration with startups • Accessing cutting edge research • Receiving information on future technology sce- The network of relations that enables the open narios innovation model gains great value from the startup • Being in contact with spin-off and startup incu- ecosystem, whose effervescence fuels our capacity to bators that are often based close to the university grow while leveraging innovation. The startuppers context have dreams on which they bet their lives, which are We have experimented with several modalities to rooted in their passions, which stimulate their ambi- collaborate with universities, each characterized by a tions, on which they feel and want to become number different level of complexity, such as: one. This is why ideas coming from the startup eco- • Degree thesis and internships in domains of system are often the most brilliant and most vision- interest for NTT DATA ary. However, the startuppers need a travel compan- • Ph.D. studies in relevant industry fields ion who shares the same spirit who can help them to • Open Labs using NTT DATA technologies direct their energy, in order to examine all the aspects • Public funding partnerships necessary to compete in the market. This travel NTT Technical Review Vol. 16 No. 10 Oct. 2018 30 Feature Articles Mastering the Idea Value intuition Prototypes Tech. Technology “disruptive” management touched labs technologies Addressing Business Business Knowledge Stay abreast of challenges from a Dissemination challenges accelerators consolidation innovation different perspective Fig. 3. Co-innovation with clients. Month 1 Month 2 Month 3 Month 4 Month 5 Month 6 Month 7 Open & Endorsement Business continuous IDEA Repeat Stream Post Grow Implement Crowdfunding Recognition Thematic & fast-paced IDEA IDEA-sprint IDEA-sprint IDEA-sprint Sprint #1 #2 #n Make it real Connected together Hackathons Hackathons at all head- quarters Fig. 4. IdeaHUB. companion will also complement the strength of the and Japan. startupper’s enthusiasm with experience and maturity and look at projects with the realism of one who is 4. Co-generating innovation with clients familiar with the dynamics of the market. We are interested in startups for the ideas they can We export the open innovation model to our clients, generate, which are enhanced with a long-term proj- providing them with a way to respond to their needs ect that creates value because it has value in the mar- for innovation, for whatever reason they have (Fig. 3). ket. In the last year, we started several collaborations To give value to our intuitions, we utilize an idea with about 15 startups to explore concrete business management platform called IdeaHUB (Fig. 4) that opportunities, including some outside Italy, in Europe permits anyone who has a good idea to post it and NTT Technical Review Vol. 16 No. 10 Oct. 2018 31 Feature Articles Customer’s Next steps internal Proposition PoC realization Result sharing challenge defined Meeting with the Identification of PoC result Goal identification stakeholder the key features analysis and risk Requirement PoC realization (rationalization) evaluation collection and with low costs Result sharing Strategic and sharing of needs shared in Improvement business plan & pains advance issue identification (new Strategy and goal identification product? new sharing business model?) • Risk sharing: NTT and the customer share initial invested resources • WIN-WIN approach: work together to achieve common goals • Continuous efficiency: after any phase, analysis time is provided in order to identify issues needing improvement not highlighted in the previous phases PoC: proof of concept Fig. 5. Design thinking and quick prototyping methodology. • Shared intellectual property • Revenue sharing on new business High • Revenue sharing models from consolidated solution • Risk sharing • Joint participation in capital equity s Open Labs • Solution scouting • License fees • PoC investment redemption on • System integration NTT DATA + Co-investment the amount of the next business • As-a-service model Customer + External (PoC will be free in case of success) contributors (e.g., universities) Sharing technologies Low and competencies for value co-creation Early stage Technology maturity level Advanced stage Fig. 6. Open Technological Labs and collaboration model. gather opinions on it. IdeaHUB is utilized both for sibility to actually touch the technologies while limit- fueling internal idea generation and as a service to ing the costs of trials (Fig. 5). support our clients with their external challenges. Technologies that have the potential to solve a busi- IdeaHUB can also be used to manage ideackathon ness challenge or disrupt the business posture of our (idea + hackathon) initiatives and special challenges customers can be jointly experimented on within and competitions. Open Technological Labs, which are physical/virtual When our customers ask us to help them solve their spaces where we can touch technologies with our challenges, we propose a methodology based on a hands. We propose a collaboration model character- design thinking approach to understand the problem ized by a level of co-investment that depends on the and a quick prototyping approach that gives the pos- maturity level of the