According to the open innovation paradigm, identified in 2003 by the Californian economist Henry Chesbrough, companies can use resources from outside, such as start-ups, universities and other types of suppliers, to advance technology.
Read on to learn more about open innovation.
Table of contents
What is open innovation
Open innovation is a strategy that ‘challenges’ the traditional closed innovation model, in which companies rely exclusively on their own internal resources and knowledge, to open themselves up to fruitful collaboration with external entities (customers, suppliers, universities, research centres, etc.) from which new products and services are born.
Synergy and brainstorming between various players in Industry 4.0 also allows costs to be reduced and progress to be accelerated. According to the Startup Thinking Observatory, this is now a common practice adopted by the majority of Italian companies, which claim to perceive concrete benefits from integration processes.
If in 2018, open innovation concerned only 57% of Italian SMEs, today it concerns 86%, a sign of renewed openness and trust in new models of distributed innovation, capable of involving knowledge flows and producing ‘spillover‘, i.e. positive effects beyond the expected spheres.
Open innovation history
The first person in the world to give a definition of open innovation was Henry Chesbrough, an American economist and author and faculty director of the Garwood Center for Corporate Innovation in California.
Chesbrough, in 2003, christened the new concept in his book ‘Open Innovation: The New Imperative for Creating and Profiting from Technology‘, where he reflects on the fact that globalisation has made research and development (R&D) processes increasingly risky as the life cycle of products has become shorter.
It was with Chesbrough that open innovation began to take shape, launching the idea that collaborations between universities and companies, research centres and start-ups lead to multiple competitive advantages. Let’s see which ones.
Open innovation benefits
Open innovation makes it possible to:
- draw on a vast background of knowledge outside their own operational limits;
- reduce R&D costs by sharing them with external partners;
- speed up 'time-to-market', i.e. the launch of new products/services on the market;
- involve customers more actively in innovation processes.
However, the real question is: how to implement open innovation? Read on to find out.
How to implement open innovation [guide for entrepreneurs]
If you want to implement open innovation successfully, you will need to adopt an open and collaborative mindset. Follow these 4 steps:
1. Define a clear strategy
Identify the areas where open innovation can bring the most significant benefits for you and develop a clear strategy in line with your business goals.
2. Spread a culture of innovation among your employees
Promote a culture of innovation, valuing experimentation, intercultural learning and collaboration between colleagues.
3. Create strategic partnerships
Identify strategic partners that bring added value to your projects; these can be universities, research centres, start-ups, NGOs and even competitors.
4. Uses collaborative platforms
Use collaborative platforms that allow you to work with several hands on documents, but first do not forget to establish clear agreements on what will belong to whom, then define intellectual property beforehand.
Open innovation in the world
There are already many companies around the world that have implemented effective open innovation strategies. The forerunner is Google which, thanks to the Google Ventures fund, finances the most promising innovative start-ups at its own expense and then acquires them.
Samsung, for its part, has opened several ‘open innovation centres’ (the most important is located in Silicon Valley), where start-ups and innovators from all over the world can propose their ideas and apply for funding.
But other big players, such as Kodak, Siemens, Sony, Michelin, Apple and Amazon wasted no time in adopting open innovation, often turning the ideas of employees, innovators and start-ups into success stories.
Open innovation in Italy
In Italy, the concept of open innovation is still immature, although it has made many proselytes among the CEOs of the most enlightened companies. An interesting example, recognised and envied abroad, is that of Enel, which has widely embraced open innovation.
Enel has created a real division dedicated to open innovation, establishing hundreds of partnerships throughout the country. Result? 80 new collaborative projects were born, which had a significant impact on the company’s revenue.
Also exemplary are the cases of:
- Dompé, which opened an open innovation department with the aim of forging alliances with over 200 research centres around the world;
- Zucchetti, which has based its open innovation strategy on the acquisition of innovative start-ups to internalise the production of hardware and software components for banks and insurance companies;
- Cisco Italia, which has partnered with US players to identify solutions to increase employee engagement.
Do you want to innovate too? Contact us
JO Group is a cluster of companies founded in 1998, whose core business is digitalisation and business consulting. For years, we have been adopting the paradigm of open innovation, which has so far rewarded us by allowing us to weave international networks and take advantage of facilitated finance opportunities offered by the European Commission, ministries and regions.
If you want to launch a business idea or have a project to realise, contact us: fill in the contact form below or call +390950936053.
Thanks to the credibility gained over the years, we are able to support all SMEs or start-ups that want to innovate, grow and remain competitive. Contact us!
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