Promoting open eco-innovation in Nigeria
Climate change, ocean pollution, deforestation, loss of biodiversity, households and industrial wastes and many more environmental challenges have brought to the fore the negative impacts of our economic and social activities on the environment. Many companies around the world have acknowledged the need to embrace these development challenges, and as such many of them have had to change their business models to reflect the current realities. Some developing countries are also beginning to appreciate how these environmental issues can be turned into a win-win strategy. The shift in doing business has brought about integration of eco-innovative strategies in the global industrial production value chain. Eco-innovation has been defined as the production, assimilation or exploitation of a product, production process, service or management or business method that is novel to the organisation (developing or adopting it) and which results, throughout its life cycle, in a reduction of environmental risk, pollution and other negative impacts of resources use (including energy use) compared to relevant alternatives1. Adoption of this sustainability strategy is fast becoming popular in the industrial sector as well as among policy makers. Customers are also now conscious of the sustainability of the products they buy and some are even willing to pay a little more for an environmentally-friendly products2. This is a clear indication that greening the industrial sector is a systemic challenge that requires actions across different levels of stakeholders in the public and private sectors.
However, even though Nigeria has been identified as one of the developing countries that is most likely to be affected by global environmental challenges such as global warming, air pollution etc.3–5, the country does not have a clear cut eco-innovation policy which firms could incorporate to develop sustainable competitive strategy. The closest to eco-innovation policy is the National Renewable Energy Action Plan (2015-2030) that targets 40% of rural population which will be supplied with off grid renewable energy. The industrial sector in Nigeria also faces plethora of social and economic challenges that make the implementation of eco-innovative products and services daunting. For instance, volatility of the exchange rates, high inflation rate, insecurity, low purchasing power, inadequate infrastructure, inefficient energy and transportation systems, COVID 19 pandemic, all competing with meagre financial and technical resources available to the firms6–8. Some of these issues and many more have pushed some very few firms to search for knowledge outside their competence. Meanwhile majority of the firms in the country are yet to recognize external knowledge search as an important source of firm’s innovativeness.
Why Open Eco-innovation
Eco-innovation is highly complex, technical and risky 9. For firms to eco-innovate successfully, they require knowledge inputs from many sources. Therefore, it is not uncommon to see eco-innovative firms collaborating in the areas of technological, marketing and organizational issues with external stakeholders 10. This strategic collaboration with external actors fit perfectly into the concept of open innovation which has been described as the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively11. This model has proved very successful among both start-ups and bigger companies. In a survey of over 2000 larger and smaller companies carried out by Accenture, it was found that collaboration added significant value to innovation and growth within the two categories of firms 12. Strategic collaborations among a range of stakeholders in a global ecosystem has helped businesses to activate external knowledge resources from entrepreneurs, customers, suppliers, competitors and other innovators to introduce ground breaking innovations to the market quicker.
Cases of success stories of collaboration with external actors across the global value chain abound most especially in the developed countries. A case in point is that of the High Tech Campus Eindhoven located at the Brainport Campus in the Netherlands. It comprises of over 140 companies and research institutes; 10,000 researchers developers and entrepreneurs, service providers developing future technologies and services13. This innovation hub hosts big companies such as Philips, ABB, ASML, IBM, Intel, NXP etc. One of the eco-innovative technology coming from the campus is that of the energy efficient lighting from Philips in collaboration with Eindhoven University of Technology, the Catharina Hospital, the Maxima Medical Centre and the Kempenhaege Expertise Centre. Signify, a spinoff from Royal Philips is another eco-innovative firm from this innovation hub that manufactures energy efficient LED lighting systems for professionals, consumers and lightings for Internet of Things. To attest to the proliferation of technological innovations of this hub, in 2017 Philips filed 1733 patent applications14. There are many other benefits that could come from open eco-innovation in the production process. For instance, sourcing for appropriate external knowledge enables eco-innovative firms to enhance weak internal technological capabilities that could have hindered them from being able to compete at the global green markets. In the same light, open eco-innovation often strengthens company’s networks among sustainability-oriented partners15. It also enhances firm’s environmental social responsibility as well as efficient allocation of scarce resources. When firms co-create with their customers, they are likely to benefit from new concepts for eco-innovation improvement/development 16 as well as new channels for sales and advertisements. As lofty as those benefits are, very few of such strategic collaborations geared towards eco-innovation are found in Nigeria. Majority of the eco-innovative collaborations are built around deployment of services rather actual development of the green technology. Popular business models include Pay-As-You-Go (PAYGO) and Solar Home Systems (SHS) mostly in collaboration with banking institutions and mobile operators17. Few eco-innovative firms are into manufacturing of environmental-friendly technologies mostly because of lack of technological capability, dearth of infrastructural facilities etc. One of the reasons that have been adduced for the inadequate collaborations is that the linkage and interactions among the key elements of national innovation system in Nigeria are weak and fragmented18. Another reason could be high level of barriers confronting businesses in Nigeria19 which could be seen as an opportunity for the firms to search for external knowledge broadly.
Strategies to promote open eco-innovation in Nigeria
Even though there are few strategic eco-innovative collaborations in Nigeria, the good news is that there are many platforms in the country that can be used to pivot such partnerships. A good example of such platforms is the Nigeria Climate Innovation Centre (NCIC). This platform was created by the World Bank and supported by the Federal Government of Nigeria17. The Centre provides venture capital and access to market for green entrepreneurs. They support businesses in renewable energy, waste management, smart agriculture, water solutions, green transportation and sustainable buildings. Since 2018 when it was established, more than 18 partnerships have been formalized, over 70 businesses nurtured, more than 107 green jobs created and over 10, 000 metric tons of various types of emissions avoided20. Another similar platform to NCIC is the Clean Technology Hub which serves as centre for research, development, demonstration, and incubation of clean technologies. The Centre has an Enterprise Development Program that gives a 6-Month incubation program to early-stage off-grid energy entrepreneurs. At the same time, the National Office for Technology Acquisition and Promotion created forty-three (43) Intellectual Property Technology Transfer Offices (IPTTOs) in Universities, Polytechnics and Research Institutions in Nigeria. The main mandates of these centres is to promote interactions and strengthen the linkage between University/Research Institutions and Industries which makes them ideal platforms to build green ecosystem with easy access to high profile human capital and resources from the universities. Once these platforms are formalized and positioned for effective low-carbon transition, the industry and policy best practices should be gathered and curated by a knowledge clearing house and made freely accessible online as well as dissemination through workshops, conferences, industry associations for knowledge sharing and networking, etc. There is the urgent need for the government to support all these platforms and other related ones to promote joint ventures, increase local value addition and create green jobs for smooth transitioning to green economy.
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- Sanni M. An Assessment of the Impact of Barriers on Eco-Innovation Within Small and Medium-Sized Manufacturing Firms in the Peripheral Regions of Lagos. In: ; 2020:253-279. doi:10.1007/978-3-030-44180-7_11
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- Accenture. Harnessing the Power of Open Innovation through Digital Collaboration – a $12 Billion Opportunity for South Africa.; 2016. https://www.accenture.com/_acnmedia/PDF-28/Accenture-Harnessing-Power-Entrepreneurs-Open-Innovation-South-Africa.pdf.
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