An open innovation model is a model for the company's business management that promotes innovation and collaboration with other companies and individuals. For more details, visit : https://mitidinnovation.com/recreation/introduction-to-open-innovation-model/

1. Introduction To Open
Innovation Model
MITID Innovation

2. The open innovation model first came into
light in 2003 when Henry Chesbrough
introduced it to the world. Chesbrough felt
the need to diversify knowledge and
perspectives within a firm and use this to
help innovate new dynamics. This model
brought a unique stir in firms and
companies, and the vibrations of the stir
still reside in the worldwide market.

3. An open innovation model is a model for
the company's business management that
promotes innovation and collaboration with
other companies and individuals. This
collaboration helps to break the fixed
mindset of the employees in that company
and invites talented individuals there.
What is an Open Innovation
Model?

4. A company can implement open innovation
practices through communication methods
like collaborating with two or more
companies, organizing research chairs in
universities and colleges, exhibiting
crowdsourcing competitions and innovation
ecosystems. Companies like Samsung, Lego,
Quirky, Mozilla, Facebook, and many more
have already laid down amazing examples of
open innovations that companies and firms
can refer to for inspiration.

5. Globally, there are two types of open
innovations:
Inbound Open Innovation:
Inbound open innovation is when a
company uses external sources and
expertise to create, select, acquire, and
internalize ideas. The company analyzes
ideas and perspectives from its external
environment and modifies them as per their
requirements.
Types of Open Innovations

6. Outbound Open Innovation:
Outbound open innovation is when a
company uses joint ventures and spin-offs
to publicize its internal ideas for external
sources to analyze and use. When a
company feels that its internal ideas may
be of no use to them, it practices outbound
open innovation.

7. Before understanding the advantages of
open innovation, you should know the
structure of a closed innovation model and
the issues they face.
Advantages of Open Innovation
Models Over Closed Innovation
Models

8. A closed innovation model does not allow
the interference of external ideology and
perspectives while developing products and
services. The companies that follow closed
innovation models prioritize the number of
projects they initiated, the volume of
resources they own and have generated,
and how much they have invested in
innovation. Such companies own big
research departments to generate more
internal ideas.

9. Companies following the closed
innovation models often face repetitive
issues like incomplete internal technical
knowledge, ideas not reaching the market,
and not changing resources and budgets.
The speed of innovation is quite low as
the ideas need a lot of rework internally,
which, in turn, creates a low productivity
rate. All these factors lead to a low
success rate of 20-30%.

10. The basic advantage of open innovation is
that the companies practicing this model
get in touch with external sources, which
help them understand the technical
inventions and trends from a different
perspective. Such companies may have
smaller research departments, but the
quality of ideas generated in them is far
better.
Advantages

11. Since companies following the open
innovation model use both internal and
external knowledge, the innovation and
productivity rates increase exponentially,
making the success rate soar. Stats show
that 50.4% of companies have realized
that technology disruption has a positive
impact on them.

12. However, companies should ensure that
they have control over what information to
share and publicize. Revealing crucial
information may lead to losses. Also, there
should be a proper way to utilize external
information, or else there may be
problems with the internal perspectives.

13. Find the best and most
diverse innovation courses at MIT ID
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About MIT ID Innovation

14. MIT ID Innovation Programme curates
knowledge and experiences that
challenge the very paradigm of evolution.
And that's why we have set out to define
the future of industries, communities,
cities and ecosystems. MIT ID Innovation
offers the best Design Thinking and
Innovation Courses in India.
Conclusion

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