Open innovation refers to the use of both inflows and outflows of knowledge to improve internal innovation and expand the markets for external exploitation of innovation.

1. Open Innovation

2. Prepared By
Manu Melwin Joy
Assistant Professor
SCMS School of Technology and Management
Kerala, India.
Phone – 9744551114
Mail – manu_melwinjoy@yahoo.com
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3. Open Innovation
• Open innovation refers to
the use of both inflows and
outflows of knowledge to
improve internal innovation
and expand the markets for
external exploitation of
innovation.

4. Open Innovation
• The central idea behind open
innovation is that, in a world
of widely distributed
knowledge, companies
cannot afford to rely entirely
on their own research, but
should instead buy or license
processes or inventions (i.e.
patents) from other
companies.

5. Advantages
• Reduced cost of conducting
research and development.
• Potential for improvement in
development productivity.
• Incorporation of customers
early in the development
process.
• Increase in accuracy for
market research and
customer targeting.

6. Models of open innovation
• Product platforming
– This approach involves
developing and introducing a
partially completed product,
for the purpose of providing
a framework or tool-kit for
contributors to access,
customize, and exploit.

7. Models of open innovation
• Idea competitions
– This model entails
implementing a system that
encourages competitiveness
among contributors by
rewarding successful
submissions.

8. Models of open innovation
• Customer immersion
– While mostly oriented
toward the end of the
product development cycle,
this technique involves
extensive customer
interaction through
employees of the host
organization.

9. Models of open innovation
• Innovation networks
– Similarly to idea
competitions, an
organization leverages a
network of contributors in
the design process by
offering a reward in the form
of an incentive.

10. Models of open innovation
• Innovation networks
– Similarly to idea
competitions, an
organization leverages a
network of contributors in
the design process by
offering a reward in the form
of an incentive.

11. Models of open innovation
• Collaborative product design
and development
– This differs from platforming in
the sense that, in addition to
the provision of the framework
on which contributors develop,
the hosting organization still
controls and maintains the
eventual products developed in
collaboration with their
contributors.

12. Versus closed innovation
• The paradigm of closed
innovation holds that
successful innovation requires
control. Particularly, a
company should control the
generation of their own ideas,
as well as production,
marketing, distribution,
servicing, financing, and
supporting.

13. Versus closed innovation
• Throughout the years several
factors emerged that paved
the way for open innovation
paradigms:
– The increasing availability and
mobility of skilled workers
– The growth of the venture
capital market
– External options for ideas
sitting on the shelf
– The increasing capability of
external suppliers