Scientists discover the “missing pieces” for business innovation

Scientists-discover-the-missing-pieces-for-business-innovation

When scientists race to solve pandemics like Ebola or seek to prevent genetic disorders, the last thing we want is for them to be wrong. Or do we? One group of scientists is challenging how research is published and their mission offers insights on the value of collaboration, embracing negative results and conflicting views to solve complex problems faster.

Chances are, you’ll never read a headline “Scientists failed to cure cancer after 200,000 studies” or “Climate change reversal still elusive after decades of research.” The news is depressing enough without inconvenient truths.

As scientists solve problems of that complexity and magnitude, there is always potential for a hypothesis to be wrong. There will be more inconclusive results than breakthroughs. The real failure may not be a negative result, but in not embracing the knowledge gained. This is the premise of a research collection called The Missing Pieces. The collection is published by the Public Library of Science (PLOS). As the name implies, PLOS is a nonprofit, open access publisher. Their core mission is to accelerate progress in science and medicine through more open communication and collaboration.

“Open is a mindset that represents the best scientific values,” notes their mission statement. “One that focuses on bringing scientists together, to share work as rapidly and as widely as possible, to advance science faster and to benefit society as a whole.”

Negative results matter, explains Dr. Meghan Byrne, Ph.D., Senior Editor for PLOS ONE, the journal that publishes the Missing Pieces Collection. If scientists can easily access and view negative, null and inconclusive results, this prevents them from pursuing an invalid hypothesis themselves. Researchers can focus on new approaches and get to the right solution faster.

Outside of science, PLOS’ model validates how critical transparency and collaboration are for innovation.

science-innovation

Embracing the power of transparency

The most powerful knowledge PLOS offers businesses is not the research they publish but in their mission of transparency and collaboration. PLOS was created by a group of researchers who identified a broken scientific publishing industry where intermediaries, journal publishers, limit visibility of research studies to only the most novel and conclusive findings.

“Scientists feel significant pressure for hiring, funding, and tenure,” explains Byrne. “Those decisions are largely based on publications. It’s looked upon more favorably if scientists publish in what are called “high-impact factor” journals.”

“The way the impact factor is calculated, it doesn’t reflect the quality of any study. It’s a bit counterintuitive. Those journals want what they perceive as exciting advances, so there is an incentive to publish studies where you see significant results. Scientists are thus incentivized to publish work that has positive results,” she explains.

Scientific and corporate life is not so different

“There is a business side to it,” explains Byrne, “because each scientist is often running their own laboratory, which can be considered a business because you are having to bring in funding to support the work you are doing and manage all the people who are doing research.”

Scientists feel many of the same pressures as business leaders to perform against individual metrics even when those metrics prevent knowledge sharing. For scientists, the metric is published work in impact journals. For corporates, personal incentives can lead to prioritizing a DPO metric over the bottom line, or margins over the health of your supply chain.

“Many publicly traded companies target working capital metrics, which can be very short-sighted,” says Kerri Thurston, CFO at C2FO. “I have seen companies fall short of their revenue guidance due to lack of raw materials, which could have been avoided had they been more focused on supplier health and less focused on working capital metrics. At the end of the day, if the company doesn’t make more money each year and grow, then having great metrics doesn’t matter.”

Even when an organization knows what the right long-term goals are, it can be difficult to move past individual goals and focus on the greater outcome. It doesn’t matter if it is a laboratory or a boardroom, human nature is still part of the formula.

Missing pieces: channeling conflict for innovation

While PLOS’ Missing Pieces collection houses negative and inconclusive results, it also publishes studies that refute previous research. PLOS refers to both negative and contradicting studies as “Missing Pieces” because these are the findings that scientists are least likely — and least incentivized — to publish.

“There are the same sorts of politics you see elsewhere,” says Byrne. “Any time that you are criticizing or disputing what someone else has done, the tendency is to want to be careful about that.”

Contradicting views, like negative results, help science advance, explains Byrne. “When [journals] don’t publish these missing pieces, there is a real risk that other scientists will waste time, money, and resources repeating the same experiments while not realizing the results are already known.”

In PLOS’ model, researchers who have conflicting views are invited to review and openly comment on the differing results. At its best, says Byrne, the model fosters productive discussion is a force for innovation.

One example of conflicting goals in business can occur between finance and procurement when treasury manages solely to cash conversion cycle, holding onto cash by extending terms on accounts payable. While lengthening payment terms improves some financial metrics for corporates, the practice also increases supply chain risk. Supply chain issues can cause reductions in revenue, production, and market share or result in a higher cost of goods from suppliers.

“Historically the supplier relationship has been solely managed by the procurement side of the business,” says Sean Van Gundy, Managing Director, Working Capital Advisory for C2FO.  “More and more we are seeing finance collaborating with procurement to provide procurement the support they need in managing supplier payment terms.  The reason companies are moving this way is to separate the buying negotiation into two parts.  The first part being the procurement side where they will determine the best supplier, the quantity needed for the business, and the right price for the good or service.  The other side being payment terms managed and negotiated by a finance function.”

“Separating the two discussions allows companies to ensure that their payment practices are consistent across the supply base, are financially sound to drive the most value with the supplying partner, and support suppliers’ working capital needs,” he continues.  “Procurement can now focus on managing the performance of the supplier in meeting the demands of its business and spend less time on the finances of each transaction.”

As long as all parties collaborate, finance and procurement can win, and both businesses and their supply chains benefit, too.

Managing to the metric of greater good

“We at PLOS feel that by making information more available, we’ll be able to progress toward more solutions more quickly. Science tends to be self-correcting over time, but that can take a long time if the information is slow to surface,” says Byrne. PLOS and other scientific organizations are looking at ways to increase this type of collaboration, she says, and by doing so solve complex issues and ultimately improve lives.

As you sit at your desk reviewing balance sheet metrics, it can be hard to equate the value of your work to that of scientists curing cancer. But even that lofty research relies on successful funding. Business decisions impact on lives of your employees and those of business owners and workers in your supply chain.

Business also drives the strength of the economy across the globe and offers potential to solve complex issues through the ways we choose to innovate, the products and services we develop, and the opportunities we create. Even with business metrics, the greater good is the truest measure of all.