Over the years, businesses have taken advantage of trends such as offshoring and near-shoring. Now, they can add the concept of “digital shoring” to the list and use technology to forge closer connections with multi-company ecosystems. This approach holds particular promise for chemical companies looking for ways to drive innovation.
Across industries, innovation has often been associated with groups of geographically co-located companies—that is, physical clusters that foster information- and idea-sharing around a given technology or industry. In an Accenture/Oxford Economics survey of C-suite executives from several industries, two-thirds said that “improved innovation” was the greatest benefit they saw from such clusters. But companies are not always getting what they want from these relationships—and that includes chemical companies. When asked about the effectiveness of their cluster participation, 54 percent of the surveyed chemical-industry executives said the benefits of collaboration were uncertain; 57 percent pointed to a lack of variety in the organizations with which they can collaborate.
Many executives recognize that advancing technology and digital shoring can help, and that was particularly true of chemical-company respondents. When asked which challenges could be addressed by using digital technology to connect with partners, 85 percent of those who identified a lack of variety of organizations in their cluster said that digital tools could help—almost twice the percentage of executives in other industries. Looking at chemical executives who expressed uncertainty over the benefits of cluster participation and questioned the feasibility of translating cluster relationships into valuable outcomes, about 75 percent believe there are digital solutions to these challenges.
With digital shoring, companies can use technology to create rich, flexible connections with a wide range of partners, regardless of geographic location. They can reach well beyond the traditional cluster boundaries—an important point for innovation-minded executives. Sixty-three percent of chemical-industry respondents said that “innovate new products and/or services” was a primary benefit of working with partners outside their cluster. Over half cited the ability to combine capabilities with other organizations and to share information with a broader range of companies; and more than one-third saw value in being able to reach outside their cluster to collaborate with partners on new projects.
Digital shoring works because today’s technology can enable tighter formal bonds between partners in far-ranging alliances and consortia. But just as important, it can enable informal interactions. For example, employees can use technology to form their own global digital communities, and social media and other tools can enable virtual “serendipitous encounters”—much like the chance meetings in coffee shops and conferences that are a part of life in a physical cluster. Such encounters can often be key to innovation.
Digital technology can also be used to enhance relationships within existing physical clusters—to complement, rather than replace, the traditional cluster interactions. Companies can integrate more closely with nearby partners, and thus magnify the benefits they already receive from being in a given location.
Overall, digital technology is not only making intercompany collaboration more efficient, it is also making it deeper and wider—and that is enabling new ways of working and creating value. As they pursue innovation, then, chemical-company executives should develop strategies that take advantage of digital shoring—and expand their ability to tap into new ideas.Source: “Digital Shoring for Networked Innovation,” Accenture, January 25, 2016,