White paper (WIP)

1. The challenge of implementing an Open
Innovation model for ideas evaluation: the
case of Electrolux
Simone Martinelli1
and Rosa Grimaldi2
,
1s.martinelli88@gmail.com
2rosa.grimaldi@unibo.it
All at the Alma Mater Studiorum, University of Bologna, Bologna, ITA.
Open Innovation (OI) is 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 (Chesbrough, 2006). After Chesbrough’s book in 2003, the term ‘Open
Innovation’ is one of the most discussed topics on innovation and management literature. Most
scholars and managers, while holding diverse perspectives, would agree that OI is an
opportunity to improve company’s innovation capability by the successful commercialization of
ideas (Mortara, Napp et al., 2009). Nevertheless, the evil is often in the details and even a perfect
planning could not be able to meet corporate expectations, while implementing OI models. As a
matter of fact, using OI model to evaluate ideas poses many new challenges to firms when
adopted and it is the internal organizational challenges that are perceived as most difficult to
manage (Mortara, Letizia, 2009). Through the Electrolux case study we would provide evidence
of how open innovation can be successfullyimplemented.
1. Introduction
‘No matter who you are, most of the smartest people
work for someone else’ is a statement known as Joy’s
law in high tech industry, attributed to Sun
Microsystems co-founder Bill Joy. Basically, this
assumption emphasizes the essential knowledge
problem that is faced by many enterprises today: in any
given sphere of activity most of the pertinent knowledge
will reside outside the company’s boundaries, and the
central challenge for those charged with the innovation
mission is to find ways to access that knowledge
(Lakhari and Panetta, 2009). Joy’s law perfectly
embodies the essence of Open Innovation, which
suggests the shift from a closed to an open system.
The purpose of Open Innovation is essentially to
open up the innovation process. On the one hand,
assimilating in a controlled and standardised way
external input such as ideas, knowledge or patents in
order to enables companies to enhance radically the new
product development process. On the other hand, it
allows exploiting ideas sat on a shelf, selling or
commercialising them through co-development, spin off
or partnership. Using these two mechanisms, ideas can
flow-in and flow-out from the innovation funnel
creating an inflows and outflows of knowledge to
accelerate internal innovation and to expand the market
for external use of innovation, respectively (Chesbrough
et al. 2006). The former is called inbound OI, which is
synthetically defined as ‘the practice of leveraging the
discoveries of others’; the latter is called outbound OI,
which is ‘the practice of establishing external

2. relationship with the aim to exploit business
opportunities’.
In the last twenty years, many factors have
contributed on the escalation of Open Innovation model
among companies. For instance, the raise of R&D costs,
the need for rapid new product generation and the
shortening product life cycle have highlighted the need
to rethink the way to manage innovation and more
specifically, the whole innovation process. Traditional
approaches based on the assumption that the creation
and the pursuit of new ideas is best accomplished by a
centralised and co-located R&D team are becoming
outdated. The need to have access to external
knowledge and leverage external sources of innovation
is an indisputable fact. As a matter of fact, important
innovations are increasingly being done by start-ups,
SMEs and inventors as well as research centres and
government labs spread out in all over the world.
Consequently, alliances, partnership and collaborations
are progressively becoming essential for companies who
are striving to strengthen their innovation leadership.
The creation of a balanced and trusted network around
the boundaries allow them to quickly respond to
opportunities which could occur in the market and to
have access to unique and prestigious knowledge
(Dittrich and Duysters, 2007; Chesbrough and Prencipe,
2008; Enkel, 2010). As a consequence of the huge
number of companies in the external network, the OI
models is often strongly supported by the mass use of
ICT, which allows firms to cooperate breaking down the
geographic distance and engaging unknown but valued
stakeholders in the innovation process (Pavitt, 2003;
Dogson et al. 2006).
Notwithstanding the great relevance, that open
innovation has received in the literature, scant attention
has been devoted to the analysis of implementation of
the OI strategy. Increasingly, organisations are
considering using an open-innovation process, but many
are finding that making open innovation work can be
more complicated than it looks. This calls for a better
understanding of actions implemented by companies
willing to pursue open innovation strategies, with
relation to both to the idea generation process and to the
idea selection.
We address such a gap with this paper. We offer a
detailed description of Open Innovation model and
strategy in Electrolux. We gathered data and
information for the Electrolux case from OI managers
and employees working in the OI Electrolux division.
One of the authors of this paper, while on a 6 months
internship in Electrolux within the OI division, had the
change to go for ‘participant observations’ of OI team
dynamics, access (non public) data and information,
interview OI managers and people working with the OI
division, both internal and external to Electrolux. That
gave us a privileged lens to observe and learn about OI
models. We built on this process to develop an
understanding of how OI models are implemented and
to share this unique experience.
What remains of the paper is structured as follows: in
the section below, we go through the main pieces of
research bringing to light the main advantages as well as
disadvantages of the OI model. Then we move to
illustrating the Electrolux case, focusing the attention on
the implementation phase and what are the successful
factors, which have allowed to reach several uncommon
results in term of innovation rate. We conclude by
discussing the possibilities for improving open
innovation strategies in the light of the evidence
presented.
2. Literature review
There has been a long tradition of studies on innovation
management models, which describe primarily how
companies manage changes. In this matter, there is a
great deal of debate and disagreement about precisely
what activities influence innovation and more
importantly, the internal process that affect company’s
ability to innovate. Doubtless, innovation occurs
through the interaction of three pillars: knowledge
creation, technology development and raising
consumers’ needs (Trott, 2008, Tidd, Joseph and Pavit,
2001). The combination of these, formed the basis of
past innovation management models even as well today.
In fact, since the technology-push and market-pull
models where innovation seems to be driven by a linear
process, (Rothwell, 5th and 6th Generation model), the
Open Innovation model seems to be the naturally
natural evolution during the internet era in a global and
fully-connected scenario, where innovators are more
located outside rather than within company’s
boundaries. Although, academic literature offers a wide
range of definitions about OI, all of these rests on the
permeable boundaries of the innovation process and
even in this case knowledge, technology and market
needs have been playing a critical role.
Basically, Companies that embrace the OI model,
work as innovation seekers withdrawing ideas from
external environment as well as innovation providers
pushing out unused knowledge to commercialize it.
Doubtless, there are challenges that companies have to
face if they embrace the OI model as well as threats to
evaluate carefully before the adoption.
In order to understand the gold rush in the adoption
of the OI model, we need to analyse briefly its pros and
cons. The most mentioned benefits coming from an
open model are the possibilities to reduce time to
market through collaboration (contrary to what one
may expect about cooperation between different
companies) on the one hand, and the chance to find new
technologies, (highly preferable discontinuous
technologies) through the systemically external scouting
activities, on the other hand (Chesbrough, 2010,
Chesbrough et al., 2007, Ellen et al. 2012).

3. Furthermore, OI can be implemented to explore
new markets and to have access to new knowledge
through licensing, joint venture, and strategic alliances,
which consequently allow to share R&D costs, time and
risks among partners. Additionally, the OI model has
attracted some companies because of the possibility to
include consumers in early stage of the innovation
process to anticipate their needs and thus finding new
market trends beforehand (Lakhany, Panetta, 2010).
Unfortunately, Open Innovation is not a panacea
and Companies should carefully evaluate costs and risks
that may appear, as well as benefits coming from
openness. Transactional costs (Williamson, 1985) can
quickly rise due to scouting activities for identifying the
best ideas or the most appropriate innovators.
Nevertheless, the evaluation of external sources of
knowledge could generate interesting outcomes, but
their quality and usability cannot be known
beforehand. Additionally, commercializing R&D may
generate new revenues coming fro m licensing out
patents, but there are not any empirical evidences on the
dimension of this reduction. Furthermore, Companies
engaged in partnership are used to share information
revealing intellectual properties which were not intent
to share. Under this light, OI could backfire Companies’
competitiveness.
Consequently, to mitigate the above-mentioned
risks and to exploit benefits, companies can take
different routes to OI, mainly according to their industry
or according to what is driving the impetus to become
more open as well.
For instance, in the consumer goods industry, where
understanding and anticipating consumers’ needs,
reducing time-to-market and increasing products range
could influence the market share, the OI model is not an
opportunity to improve innovation capabilities but it is a
must to feed corporate business. While, in high-tech
industry companies often use OI striving to change the
role of the game creating standards by merging, for
instance, different types technology or keeping up to
date with the rapid pace of technology development, or
further experiencing new business models (Chesbrough
2003; Chesbrough 2007; Vanhaverbeke, and West
2007; Ellen). Consequently, many companies have
reviewed their innovation process with the aim to
closely control the degree of openness, and also
addressing different ways to implement OI model.
Regarding the impetus to pursue an OI model,
actually Companies focus their efforts on the in-bound
process looking for capturing the best ideas, adopting an
open innovation approach with various degrees of
openness instead of a narrow dichotomy between open
versus closed. Few scholars have looked at different
governance modes in Open Innovation (van de Vrande
et al.2006; Fey and Birkinshaw, 2005) which are able to
generate very different outcomes in term of managerial
practices. Dahlander and Gann provide an interesting
framework to analyse the advantages and disadvantages
of inbound and outbound open innovation model. It is
rather clear that each company presents different, but
for some aspects similar, ways of doing open innovation
(Huizing, 2009, Lazzarotti and Manzini, 2009). Many
scholars and researchers identified several modes of
Open Innovation, different; for instance, on the strength
by informal-formal protection or by the number of
external innovators (Dahlander and Gann, 2010). Others
supposes the existence of vary degree of openness, and
their influence on the several strategic approaches
adopted (Lichtenthaler,2009).
Notwithstanding, these models allow to create a
useful taxonomy the gap between practice and theory in
OI model lead companies to fail expectations, due to a
misalignment between what OI really is and what
companies do. In line with these thoughts, below we
provide some evidence of how the OI model has been
implemented within Electrolux.
3. Open Innovation in Electrolux
3.1 Corporate Background
Axel Weener-Gren is the founding father of Electrolux,
in 1908 he passed by a vacuum cleaner in a store SHOP
window in Vienna and thought to himself that ‘there
should be one of these in every home’ despite the fact
that this vacuum cleaner had a very high price and its
weight was about 20 kilos (Hoffman, 2010). Electrolux
is now a global leader in home appliances and
appliances for professional use, selling more than 40
million products in 150 markets every year mainly in
two product categories: consumer durable (residential
kitchen, fabric care and cleaning) and professional
product (industrial kitchen, restaurant and laundries). At
the end of 2012 the Company had about 61.000
employers in more than 60 countries all over the world.
Products include world-leading brand such as AEG,
Frigidaire and Rex.
Home appliances are often divided into white and
brown goods. The term ‘white goods’ refers to major
household appliances in the kitchen such as washing
machines, refrigerators, dishwashers, ovens and
cookers. By contrast, the term ‘brown goods’ addresses
appliances used outside the kitchen such as video and
audio systems. The white goods industry is a medium-
low technological rate which during the last decades,
has been characterized by a stagnating demand and
decreasing unit values, where products are relatively
similar and simple to produce, although assembling
different parts and subsystems requires the combination
of knowledge domains ranging from mechanics to
electronics and plastic modeling (Sobrero and Roberts,
2002). Competitiveness mainly depends from
companies’ ability to reach scale economies and to
satisfy consumers’ needs. Furthermore, in this context
technology changes can make a stable environment
became unstable overnight (Pavitt, 1984).

4. 3.2 Open Innovation strategy
Electrolux has shaped its Open Innovation strategy on
three pillars: Challenges, Network and Mindset. All of
these exactly respond to a specific need that Electrolux
is facing to exploit new business opportunities.
 Challenges – They represent the tool used by
Electrolux (but also by many others firms) to interact
with the external network, capturing knowledge from
the state of idea to ready-product. Electrolux identifies
new business opportunities following two different
paths:targeted and inspired challenges.
Targeted challenges are solicited calls for ideas.
More specifically, these are requests for solutions to a
specific corporate need, as technical as well as market
need identified by the Electrolux corporate strategy.
For instance, these challenges might ask for additional
functionalities, better components or specific product
concept. Certainly, a challenge is launch after internal
verification of existing solutions.
On the contrary, inspired challenges are unsolicited
called for ideas. In other words, these are messages of
openness to listen to all innovative proposals aligned to
Electrolux business. These allow to capture available
solutions, at different levels of readiness, from ideas
concept to prototypes, without restrictions. Electrolux
does not specify needs, thus innovators are completely
free to offer proposals.
In the Electrolux OI strategy, the pillar ‘challenges’
includes an important novelty element, represented by
the inspired challenges, which allow to stimulate and
inspire the ideas generation onto external networks
following an approach that overcomes the traditional
scouting methodologies. The launch of this type of
challenges requires a complex management of IP and
the ability to build non-traditional agreements with
external partners.
 Network – It answers to the need of creating the
ecosystem of innovators around the company’s
boundaries. Considering the OI approach, value
creation is not just the result of an internal
transformation of input into output, but the smart and
effective combination of internal and external
resources. Before the adoption of the OI model
Electrolux had already built a trusted network which
include many stakeholders engaged in the innovation
process such as suppliers, consumers, University
department and research centers. Nevertheless, the OI
strategy aims to dramatically expand the number of
external partners and move beyond the trusted
network, including different players belonging to
unknown business sectors. Firms in the external
network could be extremely different for dimensions,
business sectors, assets and many other features.
Electrolux to better manage their business partners has
identified 4 macro categories of innovators: (I)
Solvers, (II) Brokers, (III) Entrepreneurs, (IV)
Inventors, arranging them by their behavior and
mindset. These two aspects are essential to reach
Electrolux’s goal: exploit business new opportunities.
In fact they could have a business mindset, if they
strive to gain earnings, if they are able to think
strategically about their ideas and if they want to make
ideas happen. By contrast, they could have a technical
mindset if they are focused on technical improvements
or they are able to deliver emerging technologies.
Additionally, they could have a proactive behavior that
is characterized by a quickly and independent reaction
to challenges, or a reactive behavior that is
characterized by an anticipatory, change-oriented and
self-initiative behaviour. According to these
prospective, Electrolux OI team has identified 4 macro
categories of innovators into networks:
Figure1: Innovators types
Solvers – Mainly, they are centers of knowledge
able to solve hard technical challenges. They have a
strong technical background and a reactive behavior. It
is clear that, targeted challenges perform better than
inspired challenge. They could be firms, research
centers and university departments or scientists.
Brokers – They are middle way players that play as
link among innovators, they work as business partners
in creating the word of mouth, which allows to increase
and to expand autonomously the network. They have
proactive behaviour and technical mindset. Both type of
challenges work without differences in term of
efficiency. They could be financial groups, industrial
associations, business incubators, media players or
companies offering specific OI scouting services.
Entrepreneurs – They are people who exercises
initiative to take benefit of an opportunity, they usually
accept the OI challenges to look for business partners to
make their ideas happen or to expand their existing
business. They usually have a business mindset and a
reactive behavior. Inspired challenges perform better
than targeted challenges with them.
Inventors – Mainly, they are brilliant people with
creative personality and technical background able to
produce or contrive something previously unknown.
They actively contribute in new product development

5. process. They have business mindset and a reactive
behavior. Inspired challenges work better with them
than target challenges.
Given the above, it is clear that all these players play a
crucial role in OI model because they allow Electrolux
to strongly contribute in the new product development
process directly and indirectly. In detail, brokers allow
to decrease the effort spent by Electrolux for scouting
activities. Presently, Electrolux OI team has mapped
more than 700 potential brokers and they have activated
more than 200 alliances. Their systematic scouting
action allow to Electrolux to have the most attractive
firms in its network, without increase transactional
costs. In the Electrolux OI strategy, the pillar ‘network’
includes an important novelty element, represented by
the creation of brokerage alliances with non-traditional
stakeholders: for instance small start-ups can play as
brokers in specific geographical areas, forwarding new
opportunities through new business models as a well as
innovation provider.
 Mindset – It is a set of behaviours, assumptions,
methods and mental attitude held by one, more people
that creates a powerful incentives to within these
people to continue to adopt or accept prior behaviour,
choices or tools (Hutchins, 1995). It responds to the
need to facilitate and to encourage the exploiting of
external resources of innovations, not just using
internal centres of knowledge and further to avoid the
not-invented here syndrome (Katz, Ralph, and Thomas
J. Allen,1982).
The distinctive element of Electrolux OI strategy is
concerned the 360° experimentation approach, which
allows to use and test several methodologies and tools
to interact with the network. Electrolux has developed
new ways to stimulate external network, pushing OI
approach out of the comfort zone, in areas not
completely known and where IP management becomes
an extremely critical activity.
4. Implementation of OI model in
Electrolux
In the light of increasing competitiveness and the
squeezing demand in developed market, the
implementation of OI seems to be the only way to
guarantee a sustainable growth, because of the
unfeasibility to increase the rate of innovative products
by doubling the investments in R&D, which actually
represent the 3% of revenues in household appliances
industry. Consequently, the need for dramatic increase
in innovation rate cannot be pursued only through the
efficiency of the internal R&D. Electrolux cannot be
innovative on its own anymore. Under this light, OI
aims to disrupt the status quo in the appliances
industry feds the corporate business by new flows of
ideas.
To reach that goal, Electrolux started the
implementation of the OI model in May 2011, creating a
new specific role, the OI Manager, with the
responsibility to design the whole model in order to
identify new business opportunities for the Group. Since
the beginning, the shift from a closed to an open system
has been challenging because of Company’s dimension,
the leadership position that strengthens the non-invented
here syndrome and the increasing complexity of the
internal innovation model. Even if many business units
were intrinsically open, implementing the OI strategy
mean create a systematic process to exploit new
business opportunities that works coupling with the
existing innovation management model. This in not
means that OI is an additional engine, but it is a sort of
turbo system that accelerates the existing engines
represented by different company’s functions.
The heart of OI implementation has to do with the
ways ideas are managed. Before getting into that, it is
important to highlight some aspects underlining the OI
implementation process.
4.1 Translating strategy into practice
Electrolux has noticed that an effective implementation
of the OI model requires the adoption of three main
building blocks to exactly translate the OI strategy into
practice:
Global Engagement – From the beginning of the
OI establishment, Electroluxhas decided to implement a
global OI strategy to exploit new business opportunities
spread up in the entire world. The term Global
Engagement stresses the will to look for innovations (or
ideas, depend from its state-of-art) for all business
sectors such as fabric care, laundry, small appliances,
accessories and refrigerators engaging in the same time
all company’s departments such as Marketing, R&D,
Finance, Operations and Production. In this way,
Electrolux can systematically look for innovations on
global scale through a cross-functional team that
withdraws innovations such as additional functionalities
for oven, better components for refrigerators, new
materials for hood filter, better inbound logistic
solutions or new manufacturing processes and then
expose them to internal evaluation done by business
functions. For instance, a new technology process for
ovens chassis developed by a research center in Asia, if
caught by the OI team will be evaluated to Electrolux
Manufacturing department in Europe. This instance
exactly represents the meaning of connection smart
people inside and outside the company.

6. Learn by doing approach – Electrolux has been
creating a trial and error approach to implement the
OI model, showing a real entrepreneurial behaviour
going out from the comfort zone and exploring new way
of doing business. Starting from every-day practice
and using just available resources that are people and
knowledge within the Company, Electrolux has been
tailoring its own OI model. Implementation was done
without the direct involvement of external consultancy
firms, but with a strong reference to the past experience
in managing external partners that Electrolux had and
engaging people who already work in the Company.
Basically, Electrolux builds the model learnt to ‘build
the car while it is driving it’, since the starting practices
which have been adjusted as according to the success of
the OI teamover time as well as the effectiveness of the
innovations developed. Moreover, this method has
allowed delivering results rapidly, making innovation
acceleration effective in a short time perspective and
also contribute to create knowledge, in fact failures,
issues and wrong decisions during the development
process allow to learn from past experiences and
consequently increase performance in the short term.
Last but least, Electrolux following this approach has
been building a dynamic OI model able to redesign its
shape according to internal and external changes.
Top-Down and centralized approach –
Implementing OI model means also answering
questions about organizational control and localization.
Basically, this means decide how much freedom in term
of budgeting and decision-making should be done at the
OI team. Electrolux OI has preferred a centralized
approach using a unique cross-functional team with
the responsibility to develop the OI model, rather than a
distributed approach with responsibilities spread up in
several parts of the Company. In that way, Electrolux
easily control the cost and the effectiveness of opening
the innovation process directly monitoring the ideas
flowed and projects developed (there is great deal of
debate about how to measure performance in OI, but it
has not a central role in this paper). Furthermore, a
short hierarchical structure directly connected with
top management (Design, Marketing and Finance also
called Innovation Triangle) allows saving time
shortening as time for decision-making as well as time
for product development. Top-down approach has
been preferred to clearly communicate the shift from a
closed to an open system. Thus, OI was embraced firstly
by top managers who work as innovation champions (Di
Minin, 2010), and consequently as enablers for a new
behaviour towards company’s boundaries, especially
reducing NIH syndrome.
5. Ideas management
Electrolux primarily uses the OI model to exploit new
business opportunities through the identification of the
best ideas. This practically means creating a wide range
of processes which allow external stakeholders to
submit their ideas and allow the OI team to filter and
select the most prominent ones. Electrolux created
several standard processes for ideas management,
without radically modifying the corporate structure. The
main processes are described below.
5.1 Ideas scouting
It is a well-known fact that, the ideas generation phase
located at the early stage of the innovation process plays
a critical role in terms of innovative product rate (Koen
et al. 2001; Reid and Brentani, 2004). Even more in
open models due to the increased number of
stakeholders, which contribute to feed ideas into the
innovation funnel from outside the company’s
boundaries. Furthermore, Electrolux motivates external
innovators using targeted or inspired challenges to
receive the highest number and to attract the most
prominent ideas. As a consequence, the chances for
finding valuable ideas are higher, because the quantity
of new ideas is positively correlated with their quality
(Dieh and Stroebe, 1987; Simonton, 1999). Certainly,
external ideas are in state-of-chaos outside the
company’s boundaries and although they are not
completely clear and understandable, there is a huge
potential in terms of knowledge.
This phase, also called scouting phase, is
characterized by an extensive information exchange
between OI team and innovators in order to clearly
clarify the features of each idea. Afterwards, collecting
the required information without revealing confidential
information, ideas are filtered, using a set of
perspectives called ‘Filtering Deliverables’ (discussed
in the next paragraph) and the most prominent go
forward in the innovation funnel. By contrast, ideas not
attractive for Electrolux are rejected, modified or
promoted to other stakeholders in the external network.

7. Figure2: Electrolux innovation funnel
The peculiar element of Electrolux challenges is exactly
this specification between inspired and targeted, which
allow receiving a higher number on the one hand, and a
different type of ideas, on the other hand. More
specifically, the inspired challenges show a better
performance than the targeted ones, in fact the former
has a success rate of 20% while the latter has just 5%.
This means that, 1 idea out of 5 coming from inspired
challenge is a prominent idea. However, it is important
highlighting the motivation effect of both the typologies
of challenge, and their complementary nature, that allow
to attract as ideas relevant to a specific corporate need
as well as ideas to exploit opportunities in the market.
5.2 Ideas filtering
Because of the huge amount of ideas, Electrolux OI
model is based on a strong filtering system, able to
evaluate quickly and accurately the potential of the
received ideas. The filtering process is often challenging
in open model because number of ideas received is not
easy to foreseen and often they are extremely different
in term of contents. Sets of perspectives called
‘Filtering Deliverables’ have been created by Electrolux
to understand the ideas potential beforehand. These
perspectives are called: ‘Consumer Opportunity’,
‘Business Opportunity’and ‘Alliance Viability’.
The perspective Consumer Opportunity analyzes
the idea potential through the consumers’ point of view.
Firstly, Electrolux have to be sure to might deliver new
value to consumers through the idea under evaluation.
Thus, a project goal is identify to clearly point out how
the idea contribute to create new value to consumers. A
new functionality or a new design for small appliances
could be good examples of project goals. Secondly, the
OI team supposes and foresees benefits for consumers
making the idea happen. Lastly, it is evaluated the
unique selling proposition (USP) that highlights the
distinctiveness and the uniqueness of the idea under
evaluation. Using these different points of view,
Electrolux strives to understand the opportunity for
consumers beforehand.
The perspective Business Opportunity analyzes the
ideas through the Electrolux’s point of view. Thus, the
OI team elaborates a projection of the idea under
evaluation in the current economic landscape, in order
to understand whether or not it is competitive. For
instance, solutions already present in the market might
be a good indicator of the idea competitiveness.
Furthermore, the OI team checks that the idea is aligned
with the corporate strategy. Lastly, it is evaluated the
compliance between the corporate business model and
the idea business model.
The perspective Alliance Viability analyzes idea
potential through innovator’s competences and assets
point of view. It describes partner capabilities and goals,
in order to understand whether capabilities are
complementary and goals aligned. Additionally, the OI
team analyses available tools used for IP protection and
suppose potential alliances models, accordingly. Below
is reported the filtering deliverables applied to a generic
product idea (fig.2).
Figure 3: Filtering Deliverables for product idea
Under this light, it is easy to observe that innovation in
an open context occurs through the interaction of three
pillars: raising consumer’s needs, change in the market
and complementary knowledge between parts. Applying
these set of perspectives, the Electrolux OI model
merges the theoretical insight to filtering activities to the
daily trial and error experience in order to correctly
create a path to evaluate ideas. In this way, it is likely to
solve some relevant issues: evaluate a higher number of
ideas coming from stakeholders belonging to different
industries and consequently with different backgrounds.
In order to achieve the main goal of OI model, identify
new business opportunities, the OI team aims not just to
recognize business opportunities but further to
maximize the ideas’ speed inside the funnel in order to

8. minimize the time from idea generation to the product
launch. Specifically, the experience gained from the
continuous developing of ideas as successfully as well
as fruitless has allowed Electrolux to considerably
reduce time to market and further to understand better
how to identify a prominent ideas using the above-
mentioned set of perspectives.
5.3 Ideas selection
On regularly monthly basis, the most prominent ideas
are showed to Electrolux internal stakeholders in charge
to decide on a value of an idea in terms of innovative
impact on corporate business.
For products ideas, stakeholders belong to Marketing,
Research and Development and Design global
departments composing a cross-functional board called
Innovation Triangle. Each geographic sector such as
North and Latin America, Asia Pacific and EMEA has a
proper innovation triangle which runs periodically
boards with the OI team to decide which ideas develop.
Parallel to sectors, global stakeholders are in charge to
deliver decisions about innovative ideas representing
global business opportunities. For ideas in
manufacturing area, stakeholders belong to process
engineering departments, Quality and Research and
Development.
With reference to product ideas, the
multidisciplinary dimension of the innovation triangle is
the crucial element to deliver committed and successful
solutions to the market, while the geographical set up of
the innovation triangle is fundamental to evaluate
solutions that suite regional consumer’s preferences.
When ideas are approved by the Innovation
Triangle, they enter in a standard product development
process that makes ideas happen. By contrast, ideas
rejected will not be developed, but the OI team enables
external business partners to connect with other
stakeholders that may be interested to develop their
idea. Meanwhile, ideas rejected never go completely
away from the external network and this peculiar
element allows creating the word of mouth among
innovators, expanding autonomously the network
without effort.
6. Conclusions
Why are some companies winning the game more than
others using their open models (Dahlanler and Grann,
2010)? Which are the aspects of the Electrolux model
making the company better off than others in exploiting
the advantages ofan open innovation system?
Electrolux OI model has several peculiar aspects,
which affected not only the performance in terms of
innovative product rate but also in terms of business
development. Firstly, the Electrolux OI model clearly
demonstrates the advantages to offer an opportunity to
the external partners to do business together. This is a
great incentive to attract a wider range of participants to
come up with their ideas. It is proven through this case
study, especially looking at the number of ideas
received, that monetary or material benefits are
secondary for people’s motivation in creating better
ideas or products. By contrast, the opportunity to do
business with a successful company is extraordinary
appealing. In this way, Electrolux has been able to
attract a higher number of participants with wider
backgrounds that in turn means more and diversified
knowledge and thus higher possibility to find valuable
ideas. Secondly, in the Electrolux OI strategy the
inspired challenges represent an important novelty
element, which allow stimulating and inspiring the ideas
generation onto external networks following an
approach that overcomes the traditional scouting
methodologies. Additionally, the creation of brokerage
alliances with non-traditional stakeholders allows to
hold scouting costs down. Moreover, the launch of
different type of challenges (inspired or targeted) to
different type of innovators (entrepreneurs, brokers,
inventors and solvers) shows interesting results, that
considerably increase the possibility to find prominent
ideas. Lastly, Electrolux has built the OI model strongly
believing that ideas happen in coffee house and not in a
shared platform. A large part of the Electrolux OI model
is face-to-face and this aspect contributes to the success
of the OI model, which encourages a better dialogue, a
fruitful exchange of ideas and the rapid development of
trust, that become essential when IP management is
critical. As a consequence, Electrolux has been able to
create an innovation context, creating a real rush for
doing business with a successfulfirm.
Nevertheless, there are some unanswered questions
and issues: in fact, IP management could be difficult
without legal tools, and some partners are more
reluctant to share ideas with big companies in order to
avoid the risk to lose the idea ownership. Even through,
trust creation is essential to reduce opportunistic
behaviour between parts, is not enough to feel
comfortable innovators such as SMEs, start-ups and
inventors. Often non-disclosure agreement is required to
reach a deeper level of accuracy to understand the
potential of the idea beforehand. By contrast, managing
a huge amount of ideas and partners is challenging
because it clearly improves the complexity of the
internal innovation management model. In fact, internal
costs for ideas evaluation and selection might rise
rapidly and in the long term Electrolux might evaluate
to push out also this process. But what would occur if
Electrolux opened their ideas selection to outsiders, and
further what are the best outsiders to involve in the
selection process? Several scenarios might occur in the
future and but now it is quite hasty for us to make a
projection.
In view of this, to guarantee the success of such OI
model, the implementation phase has been playing a
critical role. As matter of fact, adopting a trial-and-error

9. approach based on every day practices has allowed to
Electrolux to build a deeper understanding about the
management of the OI model. Including in its network
unconventional stakeholders, which allow to
autonomously improving the quantity and the quality of
the innovators in the ecosystem, enable Electrolux to
reduce transactionalcosts for sourcing of external ideas.
One last comment has to do with developing the
best model for OI and implementing it in the more
efficient way. Throughout our experience in Electrolux
we had the clear feeling that the model that we
described above has emerged from the match between
theoretical insights and the daily trial and error
experience. The Electrolux team has developed a new
model, moving from what theory suggests and adapting
it every day on the context of Electrolux worldwide, by
building on the field insights through a process, which
has eventually turned out the fine grained model that we
have described here.
Acknowledgments
The authors would like to thank Dr. Lucia Chierchia,
Open Innovation Manager, Dr. Chiara Ciardetti, Open
Innovation Project Manager, Dr. Manuel Silva, Open
Project Leader and all Electrolux departments for their
support, for providing valuable comments and access to
public and confidential information and further for
hosting this research.
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