Sescom : The idea of Open Innovation is not merely a passing trend, but rather a “must have” to business. Interview with Maciej Halbry, Director at Sescom Innovation Lab.

Sescom Innovation Lab is the youngest part of Sescom Group. Its main goal is to introduce new technologies both to the market and to Sescom's internal processes. Sescom has joined the Brinc ScaleUp acceleration program as a partner. We have interviewed Maciej Halbryt, coordinator of Sescom's cooperation with Brinc ScaleUp and Director of Sescom Innovation Lab, about the direction our company has decided to pursue.

How did you come up with the idea of joining a startup acceleration programme? It would seem that the boom for startups has passed…

On the contrary. The boom has not passed, and there are more and more startups around us today. Mature companies have realized that if they remain lock themselves in their underground R&D centres in the middle of the desert, with scientists packed in rooms without windows, they will not solve all the problems and come up with all the innovations they wish to come up with. Openness to ideas from the outside that was foundational to the long-lasting concept of Open Innovation, has gained momentum today and is now universally understood and accepted. Such an understanding has also developed in Sescom, and is quite evident in the decision of the Management Board of the Sescom Group to sponsor our participation in Brinc ScaleUp. As the saying goes: who works alone, adds; who works with others, multiplies. And when it comes to multiplications, I want to make Sescom three times as strong as today!

The term 'startup' seems to be a bit overused now. Isn't it that it is convenient to define someone as a start-up company to sign up for some contest or get funding? What do you think the definition of a startup is?

Steve Blank, a serial Silicon Valley entrepreneur and author of several bestsellers, defines startup as 'a temporary organization designed to search for a repeatable and scalable business model'. Eric Ries, author of the best-selling 'Lean Startup' - whose idea of experimenting frequently, quickly drawing conclusions and making changes to repeat the cycle has become one of the most popular ways of creating startups - defines the concept as 'a human institution designed to create a new product or service under conditions of extreme uncertainty.' These four elements: extreme uncertainty, scalability and repeatability of the business model and temporary, are the characteristic elements that define today's startups.

On the other hand, there might be other definitions of a startup - as many as those who try to define it. This creates space for abuses, which, of course, quite inevitably arise. Similarly, startups describe themselves in the context of current technological trends. Recent studies have shown that, in Europe, 40% of startups who claim to be engaged in AI (Artificial Intelligence) do not do it at all. None of the components of the solutions they propose has anything to do with AI, but that's what they call themselves. Why? Because there is a 'hype' for AI, all that is related to 'AI' seems hot and fantastically attractive. It seems easier for such a topic to get through to the media or to investors. Quite recently, it was the same with Big Data or blockchain. Unfortunately, the mechanism works as a self-fulfilling prophecy. On the other hand, the market is brutal and very quickly verifies such 'fake' businesses.

Why have you decided to collaborate with Brinc in the ScaleUp acceleration program?

One needs to know how to work with startups. Because of some peculiarities of theirs (both in terms of activity and ways of thinking, which are often different to what we are used to in mature and stable organizations), cooperation with startups requires an appropriate approach.

ScaleUp consists in the systematic connecting of mature companies with startups that fit well into the business models of these larger companies. Brinc will support us in our partnerships and will somehow 'lead us by the hand', so that within 3 years of the programme we can become independent in our cooperative searches. With many years of experience in selecting and supporting the development of startups specializing in the areas of Internet of Things and Connected Hardware, Brinc is an ideal partner for us. What's more, coming from Hong Kong, Brinc brings in an international perspective. Among the startups in the first of five rounds of the current edition of the programme, only one is from Poland. At the same time, Brinc opens us to non-European markets.

What stage are you now at?

From mid-February to the end of March, there has been an intensive evaluation process for over 200 startups who have applied for the recruitment. Brinc has done the first screening, and for our assessment he gave us about. 70 of them. In a team of more than a dozen people from different departments in the company, we have evaluated each startup's capabilities to be implemented in our business or in the operations of our customers.

On April 8, the first round of the program began. All startups come to Poznań for 11 weeks to visit Brinc in Poland, where they will participate in a series of workshops, meetings with mentors, investors and with us. Together, we will work to develop prototypes of their solutions. In the second half of May some of these startups will visit us in our office for a few days. This will be an opportunity to get to know them better and talk about testing their solutions with us or with our customers.

What has surprised you the most in this process so far? What is the biggest challenge for you?

The biggest surprise for me was the incredible variety of startups that came forward. From medical devices supporting rehabilitation, through a multitude of agricultural support solutions, intelligent controllers to virtual reality, devices that care about women's sexual health, to others connected to electricity generated from waste heat and from vibration. Most of these ideas were completely irrelevant to our business, but several times our jaws dropped with admiration for the creativity and for the attention the creators had for some problems. This diversity is also the result of the fact that the first recruitment for the program did not specify narrower criteria so that we could get to know the very wide range of solutions in the area of IoT that are on the market. It certainly did.

The biggest challenge today is that everything happens for us for the first time and every proverbial door needs to be opened by hand. For example, it is necessary to take care of the formalities, security and of the general interest of Sescom. It is also a challenge to ensure that as many people as possible in the company know about this initiative and understand its positive consequences and opportunities. The challenge will also be to develop a commercial offer based on startup products, in order to attract our customers. Fortunately, I experience a great lot of openness at our company.

In what startup ideas do you see the greatest potential when it comes to actual implementation? Can you reveal your favourite?

There are certainly a lot of questions that our customers would like to urgently address. Among them, there are two that provide an opportunity for Sescom: energy efficiency and optimisation of operational processes. In the first case, it is about reducing costs, but also about an ever-stronger commitment to ecology and a responsible approach to the environment. In this area, ScaleUp will be attended by two startups, with whom I hope to establish close cooperation. The area of process optimization can be addressed by the emerging offer based on RFID technology and supporting the management of the retail merchandise, such as clothing. I hope that among the startups in the next ScaleUp rounds we will find gems that will expand or replace RFID capabilities, and we will be the first to implement it!

It is hard to choose a favourite. Out of more than 200 applications, 5 startups have been selected to the first round, i.e. less than 2.5%. At Harvard, around 5-6% of applicants are accepted. It shows that we will get to know the genuine crème de la crème of startups. For me, they are all favourites, even if they fail to finally cooperate with us for some unforeseen reasons.

What are your plans for this project? What will be the biggest success for Sescom Innovation Lab when the project has been completed?

We have less than 3 years now to gain the most practical knowledge on how acceleration programs such as ScaleUp are run, how work with start-ups should be organized, as well as on how to plan and execute implementations together with them, and potentially on how to invest in such young technology players. The plan is to learn as much as possible, gain and accumulate know-how and promote it at Sescom. At the end of the ScaleUp programme, we should achieve autonomy in these fields. Knowledge must be distributed among several persons here at SIL.

Personally, I think that the greatest success not only for SIL, but for Sescom Group as a whole, will be a certain openness, readiness and ability to cooperate with dynamic technological startups. To do this, we will need to change our attitude a bit, as well as to alter some processes and practices in the organization, and ultimately to change our organizational culture. Such cooperation can take the entire company to a completely different level, which - as we are starting to work on our 'Sescom 2030' strategy - is definitely worth considering.