Many companies would like to find a way to renew themselves, to progress and constantly improve. There are many solutions available, yet none seems convincing enough. Perhaps an alternative solution is necessary: open innovation.

In 2003, Henry Chesbrough coined the phrase “open innovation” and defined it as follows: “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 ”. Over 15 years later, this term is used daily by companies to indicate any innovation that is generated not from inside the company, but from collaboration with persons outside, such as startups, universities, research entities, suppliers and consultants.

Open innovation is increasingly widespread, because it brings advantages on various fronts:

  • Sharing of costs and risks: attempting innovation in any setting always involves a very high risk of failure. Reaching agreements with others outside the company helps to share responsibility, commitment and any losses
  • Less time: development and commercialisation time of an idea is shortened
  • New horizons: through collaboration with external agents, it is possible to take previously unexplored ideas into consideration and discover new potential and possibilities for the company
  • New technologies: the company could obtain new technologies and knowledge to use in future projects
  • More brains, more ideas: a company can independently employ the best professionals on the market to find new ideas, but it will never have the vast amount of input available by applying open innovation

One good example of open innovation is the AppStore. Apple has made a platform available on which all creators and programmers can sell their apps. The ideas, therefore, come from outside, but in the end, they are channelled into a single place, made available by the company that conceived it.
How can one put open innovation into practice for one’s own company?
There are different ways to do it.

  • Call for ideas: in this case, the company organises an ideas contest, open to the general public, and sets the goals, limits and rules
  • Hackathon: the company calls a programming competition, in which it asks developers and programmers to find innovative digital solutions to meet a certain requirement. Everything is done in a short period of time, usually 24 or 48 hours.
  • Company accelerators: if there is a startup involved, the company can decide to back it during its early stages, providing the instruments and space for it to develop a business or project.
  • Partnerships: these are inter-company agreements for which a company delegates a task another company, to create certain innovations or products. This sort of collaboration can take place through enterprises, between an enterprise and a startup, or even between a company and a university, a research centre or a group of researchers. At times, a partnership is a way to tie two previously competing companies in order to reach common goals.
  • Acquisitions: a large company takes over the majority share of a new enterprise or a startup and creates a new workforce, richer and more structured in terms of ideas and technologies.

Open innovation is a resource that can have very good results with the advantage of never coming to an end. The important thing is to use this resource in the best possible way, by remembering the final goals so as not to get lost in the wave of proposals that may arrive once this process has commenced.

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