Fashion networking: collaboration, open innovation and circularity

According to Textile Exchange's "Preferred Fiber & Materials Market Report" the fashion industry may not meet climate goals due to the growth of textile production, which increased to a record 113 million tons in 2021, after a slight decline due to to COVID-19 in 2020.

Within the Report it is underlined that in order to face the global climatic challenges, actions capable of rethinking and reducing the growth of textile production are needed, but also a rapid transition towards the use of preferred materials and towards a collaborative approach between companies to promote technological progress.

The transition towards sustainable and circular development models is a long and complex process, which requires multidisciplinary skills that are not always present within a single company.

Hence the importance of creating a network of collaborations with the aim of facilitating the identification of innovative and sustainable solutions by sharing the risks of research and development activities.

In the fashion sector, the creation of a network of companies, designers and professionals is essential to accelerate the transition process towards sustainability and the circular economy. To make such a scenario possible, companies need to put the new Open Innovation paradigm into practice.

Open Innovation is a new knowledge management model that describes innovation processes characterized by openness to the outside. In particular, it is based on the principles of integrated collaboration and co-created shared value, to foster the development and rapid adoption of innovative technologies.

The ecosystem with which companies can exchange know-how consists primarily of customers and the supply network, but also of research centres, universities, start-ups and public or private entities.

The logic of Open Innovation can include collaboration with external research centers and suppliers, the active involvement of customers and the transformation of internal development programs into open source projects.

An example of application of open innovation in the fashion sector corresponds to the Textile Prototyping Lab, a platform and an open laboratory for the promotion of Open Innovation and networking between Research, Design and Industry.

The Textile Prototyping Lab is the first open laboratory for high-tech textiles in Germany and offers the opportunity to implement complex textile projects through an extensive prototyping infrastructure and a competent, interdisciplinary team, such as, for example:

• Future Textiles - Digital Crafts: The Textile Prototyping Lab conceived and designed the semester-long project Future Textiles - Digital Crafts for the students of the Weißensee Kunsthochschule in Berlin. The project focused on the connection between traditional textile techniques and the potential of 'digital manufacturing'. The participating students had the opportunity to implement textile prototypes in the central laboratory of the Weißensee Kunsthochschule in Berlin and in the partner institutes. In this way they have acquired new skills on the use of textile technological processes. The project was exhibited at the Bauhaus Festival in September 2020;
• Chiengora: The start-up Modus Intarsia has developed a new type of yarn made from the undercoat of dogs removed during grooming. This often overlooked but abundant raw material is spun into a high quality yarn for fashion and interior applications. So far it has only been knitted, in the central TPL the first fabric prototypes have been developed on the Jacquard TC2 loom.

Founded as a research project by five organizations in the fields of textile and electronics research, design and business, the Textile Prototyping Lab aims to be an open, agile and interdisciplinary place for textile prototyping, based on the Open Innovation paradigm.

Open innovation versus closed innovation

In order to allow the creation of fashion networking, companies need to put into practice the principles of the Open Innovation paradigm.

Open Innovation is an innovation management model developed by Chesbrough, which has defined 6 different principles underpinning closed innovation and open innovation to understand their differences.

The underlying principles of closed innovation are:

• The most competent and capable human resources work within the company;
• Research & Development activities are carried out only internally;
• The launch of innovation on the market depends only on the discoveries of the single firm;
• If this happens, the company is able to beat other competing companies;
• The "victory" over competing companies depends only on the creation of ideas and projects of the single company superior to the others;
• Full control of the innovation by the firm prevents competitors from profiting from it.

The principles underlying open innovation, on the other hand, are:

• Not all the most competent and capable human resources work within the company;
• External Research & Development activities can generate value for the company;
• Internal research and development is necessary to capture this value;
• Research discovery does not necessarily have to be of the individual firm, but it is necessary to be involved in the research processes to benefit from them;
• The “win” of the firm depends on the use of the new internal and external knowledge generated;
• The company's results are optimized by combining the sale or licensing of the innovation generated with the purchase of external innovation processes when they are most efficient and economical.

From the principles listed above it is evident how, in closed innovation, Research & Development activities are carried out exclusively within the company to protect the company's know-how and assets such as patents, machines, software, resources, ideas, knowledge.

On the contrary, open innovation is based on the total or partial outsourcing of R&D activities to share the risks and costs related to innovation.

Open innovation: advantages and limitations

Open Innovation increases the possibility of creating and capturing value, of attracting competent collaborators, of increasing the sources of ideas for innovation projects, of solidifying innovation co-development partnerships.

In this way it is possible to reduce risks and costs associated with the innovation process and, at the same time, to speed up the technological progress of the companies that make up the network.

Although Open Innovation is considered today one of the most promising tools for the development of eco-innovation in businesses and society, it has limitations that can hinder its development.

If on the one hand the sharing of knowledge and information makes it possible to speed up the innovation process, on the other hand it is possible that there may be a "leakage" of sensitive commercial and technological data.

In this sense, the main challenge is to find a balance in the exchange of information that is sufficient to develop R&D activities while maintaining control over the data flow.

In particular, SMEs need to pay attention to the intellectual property of their technologies. Consequently, the collaboration between medium-small companies must be established in a climate of trust between the parties and above all by identifying a balance between disclosure and protection of intellectual property.

In this regard, the role of the State and public authorities will be fundamental in promoting open innovation also in small and medium-sized enterprises.

The importance of Fashion Networking to encourage innovation and the circular economy in the fashion sector

Fashion networking represents one of the main elements to stimulate innovation in the fashion sector and to favor the transition of the fashion industry towards the circular economy.

The process of innovation in the fashion sector, in fact, is very complex and presents various difficulties. For example, according to Fashion for Good, the process of transitioning from wet to dry processes in the various manufacturing stages requires investments ranging from 150,000 to 20 million dollars.

Furthermore, the investment often falls on the producers who cannot always count on the commitment of the brands.

To support innovation, more and more brands and manufacturers are signing letters of intent (LOI), which include the brand's commitment to purchase a certain number of products made with the new technology.

Recently, partnerships are also being established that include an innovator, a manufacturer and a brand jointly investing in a new machine through a joint venture (JV). The machinery is installed at the manufacturer which is part of the JV.

Having said that, although the initial investments for some technologies are high, the payback times can vary from 1 to 2 years as the variable costs of water, energy and chemicals are reduced. 

Consequently, the creation of a network of companies that collaborate with each other can stimulate and accelerate innovation processes by sharing the costs and risks associated with research & development activities.

Furthermore, fashion networking represents an essential element to accelerate the transition of the fashion sector towards the circular economy.

The circular economic model is based on the concept of collaboration and networking between companies, with the aim of circulating materials and products as much as possible both locally and globally.

Currently, the fashion supply chain has a one-way flow of products and is often concentrated in specific countries.

This can act as a barrier to keeping products in circulation.

Once products have reached their destination for their first use, they often need to be shipped or transported elsewhere for further use.

To maximize the profitability of circular business models, an effective and cost-effective reverse logistics infrastructure and expertise is needed locally. This is possible by co-creating new supply networks through the creation of a network of companies that collaborate with each other.

In this regard, technology can facilitate the creation of business networks and collaborations between companies in the fashion sector.

For example, through cloud computing factories and fashion companies can work together and simultaneously from different parts of the world.

This allows them to work more effectively and communicate faster.

Furthermore, blockchain and digital technologies can contribute to the creation of business networks in the fashion sector, since they facilitate the exchange of information relating to materials, allowing companies to operate in real-time and on-demand.

The transition towards circular fashion, therefore, involves the transition towards a diversified and strongly connected reality through a network involving all the players in the fashion system.

Fashion networking case study

There are several companies that have defined collaborative partnerships with the aim of completing their respective projects, including:

• Renewcell and H&M Group: Renewcell, an innovative Swedish textile recycling company, and H&M Group have entered into a multi-year partnership for H&M to replace the virgin fibers used in its clothing with recycled alternatives over the years. H&M Group has committed to increasing the use of recycled materials across all of its brands over a five-year period.
• If Only If and VCH Style: Luxury sleepwear brand If Only If has teamed up with VCH Style, a styling platform founded by sustainable fashion advocate and journalist Ginnie Chadwyck-Healey. Together, they created a collection featuring three new nightwear - Nancy, Maggie and Amanda - using GOTS certified organic poplin and cambric cotton.
• Stella McCartney and Bolt Threads: British luxury fashion brand Stella McCartney has collaborated with Bolt Threads in the creation of the Frayme Mylo™️ bag, made with vegan mycelium, from Stella McCartney's Summer 2022 Campaign.

Conclusions

The collaborative approach typical of Open Innovation and which characterizes the phenomenon of fashion networking, can represent one of the most promising tools for the development of eco-innovation and for the transition towards circular fashion.

The sharing of costs and risks related to the innovation process and the increase of innovative ideas that the network can foster could increase the speed of R&D activities.

However, in designing a business network, it is necessary to find the right balance between the exchange of sufficient information to develop R&D activities, maintaining control over the flow of this information, as well as the intellectual property of the technologies, especially in the case of PMI.

Despite this, open innovation, fashion networking and progress in digital technologies could favor the transition towards greater sustainability and circularity in the fashion sector.