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Open Innovation: The First Decade (ACAC)


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At Atlanta Competitive Advantage Conference, presentation for panel on “Open Innovation: Multidisciplinary Perspectives and Opportunities for Future Research”

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Open Innovation: The First Decade (ACAC)

  1. 1. Open Innovation:The First DecadeJoel WestKGI - The Keck Graduate InstituteClaremont, CaliforniaACAC 2013Atlanta23 May 2013
  2. 2. Open Innovation
  3. 3. What is “open innovation”?“Open innovation is the use of purposiveinflows and outflows of knowledge to accelerateinternal innovation, and expand the markets forexternal use of innovation, respectively.”Henry Chesbrough, O pe n Inno vatio n:Re se arching a Ne w Paradig m (2006)
  4. 4. Source: Chesbrough (2006)CurrentMarketTechnology InsourcingExternalTechnologyBaseInternalTechnologyBaseNewMarketTechnologySpin-offsOther Firm’sMarketLicensing“Open” innovation strategiesChesbrough funnel
  5. 5. Open Innovation: then and now6,161cites†† Google Scholar1,230cites1,156cites139citesDue in2014
  6. 6. What’s new?• Many antecedent/overlapping areas- Technology sourcing, IP markets,university licensing, alliances, supplierinnovation, user innovation• New ideas include- Role of the business model- Agnostic to internal/external paths- Rise of innovation intermediariesCf. Chesbrough (2006)
  7. 7. Open vs. user innovationOpen Innovation UserInnovationFocal actor Firm UserKnowledge transfer IP NeedsIP regime Patents Free revealingInnovation production Hierarchy Community, individualMotivations Monetary Social, personal utilityFrank Piller & Joel West, Ch. 4 of O pe nInno vatio n: Ne w Re se arch & De ve lo pm e nts
  8. 8. Three open innovation processes1. Inbound (or “outside-in”)2. Outbound (or “inside-out”)3. Coupled combines these twoCf. Chesbrough (2003, 2006), Gassmann & Enkel(2004), West & Gallagher (2006)
  9. 9. Inbound Open Innovation
  10. 10. Review of inbound OI• Goal: Synthesize inbound (& coupled)• Sample from 25 top SSCI management& innovation journals (+15 oft-cited)• Either mention “open innovation” or cite Chesbrough(2003)• Hand select 291 down to 165• 161 articles, 3 books, 1 chapterJoel West & Marcel Bogers, “Leveraging External Sources ofInnovation: A Review of Research on Open Innovation,” Jo urnalo fPro duct Inno vatio n Manag e m e nt, forthcoming
  11. 11. Breakdown of 165 OI pubsInbound: 118 Outbound: 50Coupled: 7057 14112426 132
  12. 12. 4-stage process modelInnovationSource†CustomersCommercializingObtaining IntegratingInteractionFocal FirmR&DOtherFunctions† Sources may include suppliers, rivals, complementors and customers.
  13. 13. 1. Obtaining Innovations• Best covered of the phases- Searching, enabling, filtering- Sourcing particularly well covered• Most popular area: sources of innovation• Often about external knowledge and notexternal innovations• Not much about asset specificity of potentialinnovations
  14. 14. 2. Integrating Innovations• Considers org capabilities and culture- Absorptive capacity over-researched- NIH is mentioned, not well measured- Implicit assumptions• Integration seems to be a black box- Are new competencies needed?- Does utilizing external innovations help orhurt internal R&D competencies?
  15. 15. 3. Commercializing Innovations• Lots of value creation- Sometimes measured using NPD metrics- Less research on value capture• Assumes external innovationscommercialized same as internal ones- How do firms differ in external innovationcommercialization capabilities?
  16. 16. 4. Reverse PathsBeyond the linear model, this includes• Feedback mechanisms- Information flow upstream• Reciprocal measures- Ongoing interactions- Includes co-creation, communitiesResearch relatively scarce
  17. 17. Other gaps and opportunities• Is everything an “innovation”?- Patent, copyright, knowledge• Where is the business model?- Not a lot of value capture• Where are the success metrics?
  18. 18. Outbound Open Innovation
  19. 19. Key challenges of outbound OI• Identifying underused IP• Simultaneous internal/externalcommercialization• Functioning IP markets• Appropriability fears• Drag due to excess appropriabilityOutbound OI research getting scarcerChesbrough (2003, 2006b), Fabrizio (2006), Enkelet al (2009), Dahlander & Gann (2010)
  20. 20. Coupled Open Innovation
  21. 21. Coupled open innovation• Two modes- Bi-directional (Gassmann & Enkel, 2004)Combines inbound & outbound- Interactive collaboration (Piller & West, 2014)Joint production• Various examples- Open source (West & Gallagher, 2006)- Communities (West & Sims, 2013)- R&D consortia (Muller-Seitz & Sydow, 2013)̈• More abstraction is needed
  22. 22. Looking Forward
  23. 23. Forthcoming OI volumes• Re se arch Po licy special issue- Chesbrough, Salter, Vanhaverbeke & West,guest editors- Ashish Aurora, lead editor- ≈10 articles• O pe n Inno vatio n: Ne w Re se arch &Dire ctio ns (Oxford)- Chesbrough, Vanhaverbeke & West, eds.- 15 chapters
  24. 24. Thank you!