Myelin Repair Foundation's Institutional Innovation

The Silicon Valley nonprofit fostered the development of a radical open-source platform for top-level health research

by John Hagel and John Seely Brown

As a management topic, innovation couldn't be hotter—even as the economy is cooling down. But how much innovation is there on innovation itself? Nearly everybody goes beyond products and services to think about innovations to the core processes of the firm. Some even subscribe to the notion of management innovation. Yet all of today's discussions about innovation are bounded by a common flaw: They stay cloistered within the four walls of the enterprise.

Innovation is needed within companies, to be sure. But today's most powerful and exciting forms of innovation are taking place across company boundaries. Think of them as institutional innovations—the changes companies make to redefine roles and relationships across independent entities to deliver more value to the marketplace and to society. Institutional innovation transcends what an individual inventor or even an innovative company can do. Innovation is a decidedly social process encompassing diverse individuals, corporations, communities, networks, and regions.

Rather than taking the four walls of the enterprise as a given, today's most promising institutional innovations seek better ways of connecting talent wherever it resides and building relationships that foster and focus learning.

An Effective Research Road Map

Consider the powerful example of the Silicon Valley nonprofit Myelin Repair Foundation (MRF), which provides an early glimpse of next-generation institutional innovation (BusinessWeek.com, 11/15/07) as it emerges on the edge of medical research and drug discovery. As its name suggests, MRF has a very specific target—to mobilize and focus research on a particular biological process, myelin repair.

Myelin is the substance that coats our nerves to facilitate the passage of electrical signals. In multiple sclerosis, that myelin coating begins to degrade, resulting in a host of symptoms, including fatigue, blindness, and loss of balance, ultimately leading to paralysis and death. The MRF was founded by Scott Johnson, a civil engineer and MBA by training, who himself suffers from the disease.

What's new and exciting about MRF's approach to myelin-repair research is that it creates a distributed network of researchers within diverse academic disciplines such as neurobiology, immunology, and neurology from independent academic institutions in the U.S., including Stanford University and Case Western Reserve University. These researchers collaborate in defining coordinated research initiatives across institutional boundaries—sharing results with each other in real time.

By jointly developing a research road map, participants construct a shared model of possible explanations of the myelin-repair process and pursue parallel, rather than sequential, problem-solving. This approach, combined with rapid iterations where participants review each other's results and refine their approaches based on this shared learning, dramatically compresses the time required for research to generate promising discoveries.

Collaborative Effort and Intellectual Property

To date, MRF has recruited four top researchers, each of whom runs a lab of 10 to 18 research staff who all contribute full-time to this growing, distributed network. These researchers maintain their existing institutional affiliations but join together in the collaboration infrastructure created by MRF, which includes joint research reviews three times a year, monthly conference calls, a shared audio/video/data platform to virtually link all participants, daily interactions, and the archiving of critical intellectual property for patent protection. MRF supplements the capabilities of this core team by contracting other academic researchers and commercial entities to expedite completion of the research plan and move discoveries into commercial drug development and clinical trials.

MRF signed intellectual-property agreements with each of the academic institutions involved, with which it will share royalties generated from discoveries it has helped to fund.