The State of Open Innovation

Submitted by on Mon, 05/02/2011 - 1:51pm

How successful is Open Innovation as an innovation method? For leaders like Proctor and Gamble the answer is obvious but the same can’t be said for the vast majority of enterprises taking this route. Partner of The Conference on Social Product Development & Co-Creation, Doug Berger, takes the soundings.

Open Innovation has been an increasingly hot topic since 2003, and the publication of Henry Chesbrough’s book, Open Innovation.  Here we are 8 years later.  A top-of-mind question for innovation executives that are on this road is, “What does my company have to show for our innovation investment?”  This article delineates where Open Innovation has been valuable and where it has yet to deliver returns.  Chief Innovation Officers will find 6 specific action steps, which will significantly ramp up gains from their open innovation initiatives.

Lots of enthusiasm yet results are disappointing

Open Innovation has improved time to market, the creation of new product features, cost, technology scouting, and line additions.  These are all vital metrics for R&D effectiveness.  This enthusiasm, and rightly so, comes from delivering nice gains in the efficiency of new product development.

Yet, 60-80% of executives are disappointed with the results from growth initiatives and investments (recent Boston Consulting Group survey).  At the end of the day, there is one result that executives truly care about from their innovation investments, and that is new growth. They are mystified as to why their investments in innovation haven’t yielded more share of existing customer’s spend, more new customers, and more new markets.  Those executives based their investments on the seemingly sound assertions that best practices and processes would get them there, that new expertise was needed, and that growth ideas should come from outside the company.

Looking at innovation investments … What are executives seeing?

This blog post was orginally published in The Conference of Social Product Development & Co-Creation partner's blog, Innovation Management. To continue reading the full article, click here. 

Doug is Managing Director, Innovate, expert in Breakaway Growth & Innovation.  He can be reached at doug@innovate1st.com  

Comments

by Dang Bui - 12/16/2011 - 5:33pm

 Creating a culture of

 Creating a culture of innovation requires the creation of a portfolio of 3 - portfolio challenge, portfolio solutions, and project portfolio. When done properly, it can help make your organization more quickly. 

by alice horton - 11/27/2011 - 9:35pm

The second proved to be an

The second proved to be an important source of growth in people who have already done - the real innovators. Great ideas are ultimately based on the growth of innovative thinking people. The building is a high-growth business is ultimately dependent on the expertise and commitment to innovative people.

by jack johnson - 11/19/2011 - 7:38pm

Chesbrough believes that the

Chesbrough believes that the services are an important area for open innovation, not only because the services are (by some measures) the greatest economic impact of the products. While services are no longer an afterthought, as when (in days as manager Chesbrough Drive) customer was just a cost center.   

by james smith - 11/18/2011 - 7:45pm

 For most companies,

 For most companies, innovation has its own function, which is mainly carried on within the organization, a series of closely managed steps. Over the last decade, however, a couple of consumer goods, fashion and technology is opening up the process of product development for new ideas were born outside the walls, suppliers, independent inventors and university laboratories.   

by Jack Hipple - 05/09/2011 - 4:00pm

Open innovation, as a concept

Open innovation, as a concept meaning we don't know it all, it a great concept. The challenge is to know hwo to look for that parallel universe. Functional analysis is the way to do this so that open innovation does not become a wild goose chase. What is the function you are trying to perform for yourself or your customer? Consider the challenge of improving air traffic control display engineering. We could talk to all the other air traffic control screen designers in the world or we could redefine the problem, in a general sense, as how can we improve the interaction of the human eyeball with information on a screen? Who else has a problem like this? Hospital operating rooms, video game makers, chemical and nuclear process control display makers. That's who you open innovate with! Ask your self who else has a concern for the FUNCTION I need to achieve and don't use any industry or company specific language or jargon in describing this.