What do jet engines, oil wells, railways, and telephone cables have in common? For the answer, we go back to 2004, with a small fire in a cable tunnel 30 metres below the streets of Manchester, England. While the fire disrupted service for a few days to over 100,000 businesses and consumers, it also led to a number of positive outcomes for BT, its customers, and its partners.

Approximately 20 percent of the world’s wealth will soon reside in the five countries often referred to as BRICS: Brazil, Russia, India, China and South Africa. What these nations all have in common, as first articulated in 2003 by economist Jim O’Neill of Goldman Sachs, is the demonstrated will to embrace global capitalism, coupled with formidable natural resources and massive, growing populations. China is expected to lead the world in the supply of manufactured goods, while India leads the way in the services sector. Brazil and Russia boast a wealth of natural resources, including oil and metals.

As a result of that service disruption, one of BT’s key customers asked for proof of diverse routing. To back up our guarantee, BT deployed a programme of routing validation to help ensure service and business continuity. One of the technologies developed for this process, to identify existing ducts and their contents, was an optical fibre vibration sensor. Invented by BT, it works like a microphone to locate vibrations over great distances and can indicate their exact source.

The development of this technology is an example of an early application of open innovation – a collaborative business model that enables BT to connect with the best minds in business, industry and academia. Throughout development, BT engaged its university partners to contribute ideas and technological research to develop the strongest end solution.

Through BT’s open innovation model, the invention of the vibration-sensing optical fibre is potentially bringing value to a number of other business partners and customers in a variety of industries. For example, BT is:

• Working with a global aerospace company to help optimise jet engine performance.
• Collaborating with a start-up tech company to apply this technology in the petrochemical industry, where it could make oil extraction more efficient by detecting sand deposits in oil wells (and saving the pipes from becoming clogged).
• Discussing with railway operators its potential to improve safety monitoring and detect copper theft.

Chris Goldsmith, Head of Group CTO’s Customer Innovation Engagement Programme, said, “The potential of this technology is limited only by the imagination. By sharing our innovation with customers, together we can develop solutions beyond BT’s traditional domain. Our customers want an innovation partner, not just a supplier. BT has become more than a telephone company. We’re an innovation partner now.”

Open from R&D to the boardroom
All of these developments have been made possible by BT’s company-wide adoption of open innovation. This is exemplified by a simple statement from François Barrault, CEO, BT Global Services, who said, “Innovation is not just inside the R&D lab, but in all the dealings we have with our customers.”

BT works with a variety of sources to innovate. We collaborate closely with external sources:

• First and foremost, customer feedback informs all aspects of BT’s business model and innovation process.
• Our University Partnership Programme maintains academic research and exchange programmes with Massachusetts Institute of Technology, University of Cambridge, and UC Berkeley, among a host of others.
• New Venture Partners LLC, a venture capital firm, which provides corporate venturing and support for high-tech start-ups.
• BT maintains high-level strategic business partnerships with industry leaders such as HP, Cisco, Microsoft, and Intel.

To sum up an open innovation scenario, Steve Whittaker, BT’s Head of Strategic US University Research Partnerships and MIT Visiting Scientist, explains, “We bring together technologists, economists and business strategists from across industry and academia to take a 360 degree view of the issues and opportunities. We operate through working groups involving competitors, suppliers, and customers … and here we discuss ideas that many players may find exciting or uncomfortable. We’re looking at the communications landscape three to ten years out and wrestling with some of the really tough challenges the industry, broadly defined, is going to face. And that’s not something you can do on your own.”

Back at Adastral Park, the intensive, highly focused environment at the Advanced Technology Center can deliver results back to the business within weeks, or even days. Prototypes developed there are evaluated internally, then by focus groups, and eventually, by potential customers to gauge reactions.

The open innovation approach ensures that market opportunities are capitalised. According to BT Group Chief Technology Officer Matt Bross, “Rather than years or months, the window of opportunity for a new product innovation to carve out an appreciable market niche may be as short as weeks or even days. We need to innovate at the speed of life.” Market demands drive BT’s business model. We understand that there should be no gap between what customers want and what BT can deliver.

BT didn’t invent open innovation – or fire – but our story of a small fire shows how open innovation can put you at the centre of the innovation process.