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Open innovation

For the event, see Open Innovations.

Open innovation is a term used to promote an Information Age mindset toward innovation that runs counter to the secrecy and silo mentality of traditional corporate research labs. The benefits and driving forces behind increased openness have been noted and discussed as far back as the 1960s, especially as it pertains to interfirm cooperation in R&D.[1] Use of the term 'open innovation' in reference to the increasing embrace of external cooperation in a complex world has been promoted in particular by Henry Chesbrough, adjunct professor and faculty director of the Center for Open Innovation of the Haas School of Business at the University of California, and Maire Tecnimont Chair of Open Innovation at Luiss.[2][3]

The term was originally referred to as "a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology".[3] More recently, it is defined as "a distributed innovation process based on purposively managed knowledge flows across organizational boundaries, using pecuniary and non-pecuniary mechanisms in line with the organization's business model".[4] This more recent definition acknowledges that open innovation is not solely firm-centric: it also includes creative consumers[5] and communities of user innovators.[6] The boundaries between a firm and its environment have become more permeable; innovations can easily transfer inward and outward between firms and other firms and between firms and creative consumers, resulting in impacts at the level of the consumer, the firm, an industry, and society.[7]

Because innovations tend to be produced by outsiders and founders in startups, rather than existing organizations, the central idea behind open innovation is that, in a world of widely distributed knowledge, companies cannot afford to rely entirely on their own research, but should instead buy or license processes or inventions (i.e. patents) from other companies. This is termed inbound open innovation.[8] In addition, internal inventions not being used in a firm's business should be taken outside the company (e.g. through licensing, joint ventures or spin-offs).[9] This is called outbound open innovation.

The open innovation paradigm can be interpreted to go beyond just using external sources of innovation such as customers, rival companies, and academic institutions, and can be as much a change in the use, management, and employment of intellectual property as it is in the technical and research driven generation of intellectual property.[10] In this sense, it is understood as the systematic encouragement and exploration of a wide range of internal and external sources for innovative opportunities, the integration of this exploration with firm capabilities and resources, and the exploitation of these opportunities through multiple channels.[11]

In addition, as open innovation explores a wide range of internal and external sources, it could be not just analyzed in the level of company, but also it can be analyzed at inter-organizational level, intra-organizational level, extra-organizational and at industrial, regional and society.[12] Recent studies have also started to explore Open Innovation at individual level (decision-makers, managers, or entrepreneurs), its Human Side, and how companies' decision-makers frame the choice between implementing Open Innovation or more traditional approaches to innovation (e.g. closed innovation).[13][14]

  1. ^ HARTMANN, DAP; TROTT, PAUL (Dec 2009). "Why 'open Innovation' is Old Wine in New Bottles" (PDF). International Journal of Innovation Management. 13 (4): 715–736. doi:10.1142/S1363919609002509. S2CID 8535466. Archived from the original (PDF) on 8 August 2017. Retrieved 16 July 2018.
  2. ^ "Henry Chesbrough | Faculty Directory | Berkeley-Haas". Archived from the original on 2019-01-02. Retrieved 2014-04-05.
  3. ^ a b Chesbrough, Henry William (1 March 2003). Open Innovation: The new imperative for creating and profiting from technology. Boston: Harvard Business School Press. ISBN 978-1578518371.
  4. ^ Chesbrough, H., & Bogers, M. 2014. Explicating open innovation: Clarifying an emerging paradigm for understanding innovation. In H. Chesbrough, W. Vanhaverbeke, & J. West (Eds.), New Frontiers in Open Innovation: 3-28. Oxford: Oxford University Press. Page 17.
  5. ^ Berthon, Pierre R.; Pitt, Leyland F.; McCarthy, Ian; Kates, Steven M. (2007-01-01). "When customers get clever: Managerial approaches to dealing with creative consumers". Business Horizons. 50 (1): 39–47. doi:10.1016/j.bushor.2006.05.005.
  6. ^ West, Joel; Lakhani, Karim R. (2008-04-01). "Getting Clear About Communities in Open Innovation". Industry and Innovation. 15 (2): 223–231. doi:10.1080/13662710802033734. ISSN 1366-2716. S2CID 73722718.
  7. ^ Bogers, Marcel; Zobel, Ann-Kristin; Afuah, Allan; Almirall, Esteve; Brunswicker, Sabine; Dahlander, Linus; Frederiksen, Lars; Gawer, Annabelle; Gruber, Marc (2017-01-01). "The open innovation research landscape: established perspectives and emerging themes across different levels of analysis". Industry and Innovation. 24 (1): 8–40. doi:10.1080/13662716.2016.1240068. hdl:10044/1/42565. ISSN 1366-2716.
  8. ^ Chesbrough, Henry (2006-12-06). Open Business Models: How To Thrive In The New Innovation Landscape. Harvard Business Press. ISBN 9781422148075.
  9. ^ Chesbrough, Henry William (2003). "The era of open innovation". MIT Sloan Management Review. 44 (3): 35–41.
  10. ^ Locatelli, Giorgio; Greco, Marco; Invernizzi, Diletta Colette; Grimaldi, Michele; Malizia, Stefania (2020-07-11). "What about the people? Micro-foundations of open innovation in megaprojects". International Journal of Project Management. 39 (2): 115–127. doi:10.1016/j.ijproman.2020.06.009. hdl:11311/1204792. ISSN 0263-7863. S2CID 225633977. Archived from the original on 3 July 2020.
  11. ^ West, J.; Gallagher, S. (2006). "Challenges of open innovation: The paradox of firm investment in open-source software". R and D Management. 36 (3): 319. doi:10.1111/j.1467-9310.2006.00436.x. S2CID 1163913.
  12. ^ Bogers, Marcel; Zobel, Ann-Kristin; Afuah, Allan; Almirall, Esteve; Brunswicker, Sabine; Dahlander, Linus; Frederiksen, Lars; Gawer, Annabelle; Gruber, Marc; Haefliger, Stefan; Hagedoorn, John; Hilgers, Dennis; Laursen, Keld; Magnusson, Mats G.; Majchrzak, Ann (January 2017). "The open innovation research landscape: established perspectives and emerging themes across different levels of analysis". Industry and Innovation. 24 (1): 8–40. doi:10.1080/13662716.2016.1240068. hdl:10044/1/42565. ISSN 1366-2716.
  13. ^ Bogers, Marcel; Foss, Nicolai J.; Lyngsie, Jacob (February 2018). "The "human side" of open innovation: The role of employee diversity in firm-level openness". Research Policy. 47 (1): 218–231. doi:10.1016/j.respol.2017.10.012. S2CID 158845645.
  14. ^ Marzi, Giacomo; Fakhar Manesh, Mohammad; Caputo, Andrea; Pellegrini, Massimiliano Matteo; Vlačić, Božidar (January 2023). "Do or do not. Cognitive configurations affecting open innovation adoption in SMEs". Technovation. 119: 102585. doi:10.1016/j.technovation.2022.102585. S2CID 250060999.
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