Open Innovation: How it works and why it matters

Introduction

Innovation is the engine of economic growth and the competitiveness of companies. However, innovation cannot be created by companies alone, but requires the collaboration of an ecosystem of people, organizations and institutions. This is the concept of Open Innovation, an increasingly widespread practice among companies all over the world.

What is Open Innovation?

Open innovation is an innovation strategy that involves the collaboration of people and organizations outside the corporate sphere. In other words, Open Innovation allows companies to share ideas and skills with other companies, universities, public and private institutions, in order to create new innovative products, services and processes.

The concept of Open Innovation was introduced in 2003 by Prof. Henry Chesbrough, of the Haas School of Business of the University of California, Berkeley. He defined open innovation as “an innovation buzzword that suggests that companies should look beyond their borders to acquire the ideas, technologies and skills they need to innovate”.

An example of Open Innovation is the "Linux" project, a computer operating system that was developed by a community of programmers from around the world, rather than being created by a single company.

How does Open Innovation work?

Open innovation works through the creation of a collaboration platform, such as an online forum, a networking event, an ideas competition or a hackathon. Experts from various disciplines, such as engineers, designers, entrepreneurs, academics and researchers, are invited to participate to create synergies between different skills.

For example, the LEGO company used open innovation to create a new product based on an idea submitted by a customer. The company created an online platform where customers could submit ideas for new LEGO sets. The winning idea was then developed and marketed by the company.

There are different methods of Open Innovation, such as the acquisition of innovative startups, collaboration with universities and research centres, participation in innovation events and the creation of communities of innovators.

Why is open innovation important?

Open innovation offers many benefits to companies, including:

• Access to external expertise and resources that would otherwise be hard to find or too expensive to acquire internally;
• Ability to create innovative products and services faster and more successfully;
• Increased company reputation as an innovator and contributor;
• Ability to build long-term relationships with other organizations and individuals.

Furthermore, Open Innovation is a way for companies to keep up with the evolution of technologies and market trends. Thanks to the collaboration with external experts, companies can identify new business opportunities and develop innovative solutions to meet the needs of their customers.

Conclusions

In summary, Open Innovation is an increasingly widespread practice among companies seeking to innovate and remain competitive. Creating a collaboration platform and involving external people and organizations can lead to new innovative ideas, products and services. Open innovation offers many benefits, including access to external expertise and resources, the ability to create innovative products and services faster and more successfully, and boosting the company's reputation as an innovator and contributor.

In an increasingly competitive and dynamic market, Open Innovation can make the difference between the success and failure of a company. For this reason, companies should consider open innovation as a long-term strategy to stimulate their innovation capacity and create value for their customers and shareholders.