Harvard Case - BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team
"BP's Office of the Chief Technology Officer: Driving Open Innovation through an Advocate Team" Harvard business case study is written by Robert C. Wolcott, Michael J. Lippitz. It deals with the challenges in the field of Operations Management. The case study is 14 page(s) long and it was first published on : Jan 1, 2007
At Fern Fort University, we recommend that BP's Office of the Chief Technology Officer (CTO) further develop the Advocate Team by expanding its scope and responsibilities, fostering a culture of open innovation, and leveraging technology to streamline operations. This will enable BP to accelerate innovation, enhance collaboration, and drive sustainable growth.
2. Background
This case study focuses on BP's efforts to foster open innovation through the creation of an Advocate Team within the Office of the CTO. The Advocate Team is tasked with identifying and evaluating external technologies and partnering with external innovators to bring promising solutions into BP. The case highlights the challenges faced by the team, including a lack of clear direction, limited resources, and difficulty in navigating BP's complex organizational structure.
The main protagonists are:
- Mark Little: BP's Chief Technology Officer, who champions open innovation and established the Advocate Team.
- The Advocate Team: A group of individuals responsible for scouting, evaluating, and partnering with external innovators.
- BP's internal stakeholders: Various departments and individuals within BP who are potential users of the innovations identified by the Advocate Team.
3. Analysis of the Case Study
This case study can be analyzed through the lens of strategic management, focusing on BP's efforts to achieve a competitive advantage through innovation. The Advocate Team represents a key element of BP's innovation strategy, aiming to leverage external knowledge and expertise to drive product development and process improvement.
However, the case highlights several challenges:
- Organizational structure: BP's complex organizational structure can hinder the Advocate Team's ability to effectively connect with internal stakeholders and champion new ideas.
- Resource allocation: The Advocate Team faces limitations in terms of resources, which impacts its ability to fully explore and evaluate external technologies.
- Lack of clear direction: The Advocate Team's mandate and responsibilities are not clearly defined, leading to ambiguity and potential misalignment.
- Culture of innovation: BP's existing culture may not be conducive to open innovation, potentially hindering the adoption of new ideas and technologies.
4. Recommendations
To address these challenges and enhance the effectiveness of the Advocate Team, we recommend the following:
Expand the scope and responsibilities of the Advocate Team:
- Focus on specific areas of innovation: The Advocate Team should focus on specific areas of innovation relevant to BP's strategic priorities, such as renewable energy, digital transformation, and sustainable operations.
- Develop a clear mandate and performance metrics: Define specific goals and objectives for the Advocate Team, including metrics for success and accountability.
- Establish a dedicated budget and resources: Allocate sufficient resources to support the Advocate Team's activities, including funding for external partnerships, technology evaluation, and project implementation.
- Develop a robust process for evaluating and selecting external innovations: Implement a structured process for identifying, evaluating, and selecting promising external technologies, leveraging technology and analytics for data-driven decision-making.
Foster a culture of open innovation:
- Promote collaboration and communication: Encourage open communication and collaboration between the Advocate Team and internal stakeholders, breaking down silos and fostering a culture of shared learning.
- Create a platform for knowledge sharing: Implement a knowledge management system to capture and share insights from external innovation activities, facilitating the transfer of knowledge and best practices across the organization.
- Recognize and reward innovation: Establish a system for recognizing and rewarding individuals and teams who contribute to the success of open innovation initiatives, fostering a culture of innovation and continuous improvement.
Leverage technology to streamline operations:
- Implement a centralized platform for managing external partnerships: Develop a platform for managing relationships with external innovators, facilitating communication, collaboration, and project management.
- Utilize data analytics for decision-making: Leverage data analytics to identify emerging trends in innovation, assess the potential impact of new technologies, and optimize resource allocation.
- Integrate external innovation activities with BP's existing IT infrastructure: Ensure seamless integration of external innovation activities with BP's existing systems and processes, leveraging digital transformation to enhance efficiency and effectiveness.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core competencies and consistency with mission: The recommendations align with BP's commitment to innovation and its strategic priorities, focusing on areas such as renewable energy, digital transformation, and sustainable operations.
- External customers and internal clients: The recommendations aim to enhance the Advocate Team's ability to identify and evaluate external technologies that meet the needs of BP's internal stakeholders, including various departments and individuals.
- Competitors: The recommendations aim to position BP as a leader in open innovation, enabling the company to stay ahead of its competitors by leveraging external knowledge and expertise.
- Attractiveness ' quantitative measures if applicable: The recommendations are expected to lead to tangible benefits, including accelerated innovation, improved efficiency, and enhanced competitiveness.
- Assumptions: These recommendations assume that BP is committed to open innovation and is willing to invest in the Advocate Team and its activities.
6. Conclusion
By implementing these recommendations, BP can significantly enhance the effectiveness of its Advocate Team, fostering a culture of open innovation and driving sustainable growth. This will enable BP to leverage external knowledge and expertise to develop new products and processes, improve operational efficiency, and maintain a competitive advantage in the energy industry.
7. Discussion
Other alternatives not selected include:
- Outsourcing the entire innovation process: This option would involve contracting with external firms to handle all aspects of innovation, potentially leading to a loss of control over the process and the development of proprietary technologies.
- Focusing solely on internal innovation: This option would limit BP's access to external knowledge and expertise, potentially hindering its ability to stay ahead of the curve in a rapidly evolving industry.
Key risks and assumptions associated with the recommendations include:
- Resistance to change: Internal stakeholders may resist the proposed changes, particularly those related to organizational structure and culture.
- Lack of resources: The Advocate Team may not receive the necessary resources to fully implement the recommendations.
- Competition for talent: BP may face competition from other companies for talent in the field of open innovation.
8. Next Steps
The following steps should be taken to implement the recommendations:
- Develop a detailed implementation plan: Outline the specific steps, timelines, and resources required to implement each recommendation.
- Secure buy-in from key stakeholders: Engage with key stakeholders to ensure their support for the proposed changes.
- Pilot test the recommendations: Implement the recommendations on a pilot basis to assess their effectiveness and identify any potential challenges.
- Continuously monitor and evaluate progress: Regularly track the progress of the Advocate Team and make adjustments as needed to ensure that the recommendations are achieving the desired outcomes.
By taking these steps, BP can successfully implement the recommendations and transform its Advocate Team into a powerful engine for open innovation, driving sustainable growth and achieving its strategic goals.
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Case Description
The case describes the evolution between 1999 and 2005 of an unusual innovation team within the office of the Chief Information Officer of BP. The team leader, Vice President and Chief Technology Officer (CTO) Phiroz Darukhanavala ("Daru"), eschewed a large group and a venture budget in favor of a small, lean team intimately engaged with BP's business units. The case described several mechanisms created by the CTO office during its early evolution, aimed at expanding executives' appreciation of emerging technology capabilities, building a network of relationships through which emerging technologies are scouted and vetted, and providing structured mechanisms for technology transfer. In late 2005 the CIO's Advisory Group challenged the CTO office to "keep reinventing yourselves." Students are asked to assume Daru's role and suggest new processes and structures to continue the evolution of the CTO office. The teaching note describes what the team actually did, and addresses questions raised at the end of the case.
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