When Industries Converge: The Power of Coincidental Interaction

One of the prime sweet spots for new ideas is when industries and areas of specialization come together. Most often, these encounters are spontaneous and downright accidental. But more often companies are intentionally planning these encounters with the explicit intention of identifying quid pro quo business opportunities; creating new synergies and at times disruptive new technologies, products or services.

The next few entries in this blog will be related to industry convergence as a source of insights and new business ideas. I will describe programs companies have introduced to specifically find convergence opportunities but will start with the more spontaneous.

Take the case of BMW’s application of an iPod dock in its vehicle offerings. The story goes that an engineer from BMW’s Palo Alto Technology Office was sitting at a bar one evening waiting for his dinner partner and while at the bar met an Apple representative. As they described what they each were doing the vision of an iPod dock in every BMW emerged. The two traded cards, parted that evening and the rest is history.

Now this idea of an iPod dock will not solve world hunger and it certainly has only marginal effect on either BMW or Apple’s turnover, but it highlights the importance of “coincidental interaction” in the business innovation process. And although this encounter occurred totally by accident, some conditions existed that moved the interaction from an interesting coincidence to a business offering.

First of all, the two individuals met in Palo Alto a hotbed of innovation.. In 1997 BMW intentionally situated itself in the heart of Silicon Valley when opening their Palo Alto Technology Office (PATYO). The purpose of this opening was to put creative engineers from BMW in touch with others developing new technologies. This gives BMW a “launch pad” to develop not just great ideas but new relationships as well.

Second, the BMW engineers arrive at PATYO with specific project ideas on which to work, but they are also expected to “sense” opportunities beyond their specific projects. They attend seminars, interact with customer communities, and link up with those who know the pulse of Silicon Valley, such as researchers, R&D centers, venture capitalists and start up owners.

Finally, each BMW employee knows that he or she has a role in identifying and developing new opportunities. Given this expectation they are constantly scanning for new opportunities and know where to take the idea once they have it to ensure specific actions are taken.

Innovative companies are quite similar in this coincidental interaction capability, but, as outlined above, certain conditions must exist for the ideas to take form and a powerful relationship between two industry power houses to take shape.

To learn more about the BMW Apple innovation go to:
http://www.apple.com/pr/library/2004/jun/21bmw.html