Whether large or small, your business can benefit from global talent. Engaging smart thinkers around the world can significantly increase your company's potential.

How can you achieve this? The task can appear daunting, particularly for companies that aren't near an innovation hub like San Francisco or New York. It is a challenge I've seen in companies and countries around the world, and there isn't a single, one-size-fits-all strategy.

But there are guidelines you can follow. Below I pull three principles from William Kerr's excellent new book, The Gift of Global Talent: How Migration Shapes Business, Economy & Society. Kerr is a professor at Harvard Business School, where he co-leads their Managing the Future of Work project and podcast.

1. Understand the power of place

Innovation is concentrating in clusters - think New York, Shanghai or Boston, where the most talented workers come together produce greater innovation than if they worked in isolation. This spatial concentration shows no sign of slowing down--Kerr points out that one in every 12 patents in America is made by a Chinese or Indian inventor in the Bay Area. This means you have to figure out how to tap into them.

This doesn't necessarily require moving your whole company to Silicon Valley or Berlin, although moving your headquarters to a talent hub does provide the most direct and sustained access to talented workers and ideas. You could also establish a research lab or similar outpost office in one or more of these clusters. At the least, you should organize leadership visits to talent clusters and learn as much as possible in that short time.

The exact formula will depend on the specifics of your company, but the bottom line is that innovation largely depends on tapping into these places. (For a deeper discussion of each approach, Kerr also wrote a recent article for Harvard Business Review.)

2. Enhance knowledge transfer through your organization

However you access talent clusters, the benefits will be severely limited if the ideas don't flow through the rest of your organization. If you establish an innovation lab in Tokyo but the lab's work and insights never make it out of Japan, then what's the point?

Infrastructure-based excuses for poor information flow have largely been eliminated by technology. Videoconferencing, Dropbox, and Slack enable instant engagement with colleagues anywhere in the world.

But technology alone doesn't communicate. You need to integrate people across locations. Multinational companies build teams that tie people together across borders and force the sharing of ideas. Though global teams can be more expensive than creating siloes, this cost is outweighed by the benefits of enhanced knowledge transfer. Managing virtual distance has become as important as face-to-face teamwork.

3. Tap into brilliant thinkers outside your organization

Airbus spent €1.4 billion on R&D in the first half of 2018. But even though its engineers create some of the world's most advanced technology, it has created a competition on Kaggle, the data science community, to engage Kaggle's machine learning experts on identifying ships in satellite imagery, which Airbus has so far struggled to do in an accurate and speedy way. The winning algorithm will earn its coders $25,000 - and give Airbus a leg up on competitors.

That competition is ongoing, so we can't see the payoff yet. But Merck's 2012 Kaggle search for new uses for chemical compounds shows the benefits. For $40,000 in total prize money - less than 0.001% of its R&D expenditure that year - Merck received over 2,900 submissions or about $14 per new idea. The winning submission came from machine learning researchers, enabling Merck to bring outside expertise into the pharmaceutical domain, in addition to getting good ideas about how to use its chemicals.

So think about how you can take advantage of the talent that exists outside your company. The opportunity isn't just in data crunching. In 2002, Procter & Gamble wanted to print images onto Pringles. It couldn't do this in-house, but rather building the capability internally, P&G searched within its network and found an Italian professor who already developed such a printing technique for his bakery. The resulting partnership generated higher Pringles sales at a fraction of the cost of developing the capability internally.

This success inspired P&G to create Connect + Develop, a website where innovators around the world can submit concepts to meet P&G's new product needs. It is currently looking for designs in the gum health and non-toxic insect control spaces. Do you have any ideas?

Published on: Oct 31, 2018