New Guide Highlights Ways to Introduce Open Innovation

What have the British-based multinational Unilever, oil firm BP, pharmaceutical giant GSK, and electronics manufacturer Philips got in common? The answer is they have all embraced Open Innovation as way of developing new products or accessing new technologies. Now Cambridge University’s Institute for Manufacturing has produced a new guide to show how other companies can follow in their footsteps.

The report, “How to Implement Open Innovation”, is the result of a two-year study of some of the world’s leading firms.

The research team looked at more than 30 major companies from a variety of sectors, including energy, aerospace and defence, software and media, electronics and telecommunications.

It is thought that open Innovation could be a way of improving a firm’s ability to create and capture value, by improving the rate and quality of innovation. Rather than relying on internal resources firms share knowledge and technologies with other companies in a bid to create new commercial opportunities

Letizia MortaraReport co-author Dr Letizia Mortara, of the IfM’s Centre for Technology Management (CTM), described its purpose:

We wanted to try and find out if there was a framework or guide for other firms to implement Open Innovation

- While Open Innovation is a relatively new phenomenon, it has started to gain traction in businesses across a range of sectors. We wanted to try and find out if there was a framework or guide for other firms to implement Open Innovation and to understand what people involved in its adoption did on a day-to-day basis.

Dr Mortara thinks that Philips is a good illustration of open innovation implementation since it created incubation processes to carry out research into ideas which do not immediately fit within existing businesses, but in time could lead to the introduction of new products.

- But Philips is not the only firm to embrace open innovation, and others have adopted interesting approaches. Our study provides an overview of a range of current practice and illustrates the challenges firms may face when attempting to implement open innovation.

Dr Tim MinshallFellow author Dr Tim Minshall, a senior lecturer at CTM claims that open innovation has already shown it can help firms cope with emerging challenges and create new opportunities.

Among the guidance contained within the report is how companies can build an open innovation culture, how to develop the necessary skills within the business and how to motivate employees

-While not a panacea to all business problems, it can be a positive process. We think the report offers an overview of existing approaches to open innovation and an outline of how to implement it and some of the main obstacles that need to be overcome.

Among the guidance contained within the report is how companies can build an open innovation culture, how to develop the necessary skills within the business and how to motivate employees.

-While each company will face different challenges and will have different reasons for pursuing open innovation, the report offers a framework which can be tailored to their needs, says Dr Minshall.

The report was written by Dr Mortara, Dr Minshall, and Johann Napp of the IfM and Imke Slacik now of McKinsey and Co. It can be downloaded at http://www.ifm.eng.cam.ac.uk/service/books/form_oi09.html

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