Managing Open Innovation

Managing Open Innovation

Connecting the Firm to External Knowledge

André Spithoven, Peter Teirlinck and Dirk Frantzen

Open innovation is about firms’ external relations with other firms and organisations. It is a topic which has attracted an immense amount of attention, but which has also been heavily criticised due to the diversity of the ideas and fuzziness of its key concepts. To date, the bulk of the literature on open innovation draws on case study material to illustrate the operation of firms in an anecdotal way. By contrast, this book examines open innovation practices by using large-scale datasets and stresses their impact on firm performance. The authors examine four key issues: differences between firms in open innovation practices, public funding to enhance external relations, R & D outsourcing of firms, and the role of human resources in R & D and innovation.

General introduction

André Spithoven, Peter Teirlinck and Dirk Frantzen

Subjects: business and management, knowledge management, organisational innovation, economics and finance, economics of innovation, innovation and technology, economics of innovation, knowledge management, organisational innovation

Extract

INTRODUCING OPEN INNOVATION The process of innovation is dynamic and complex, and entrepreneurs have to deal with, and adapt to, the ever-changing environment in which they operate. Many textbooks, therefore, start by listing innovation models from every conceivable perspective (see, for example, Dodgson et al., 2008; Schilling, 2008; Tidd et al., 1997; Afuah, 1998; Trott, 1998; Rothwell, 1992), or by showing these models' sequential rise and fall (for example, Chesbrough, 2006a; Rothwell, 1992; Rothwell and Zegveld, 1985; Trott, 1998). Open innovation has been welcomed as the most recent member in this family of models. Authors rarely explain the precise demarcation or transition between the stages of the different innovation models. Chesbrough is one of the first, however, to undertake such an effort in describing the ‘erosion' of the closed innovation model and transition to the open innovation model. It is claimed that innovation is entering a new ‘era’ involving deliberate and intense knowledge exchanges between firms and other organisations (Chesbrough, 2003b). At the firm level, knowledge exchanges are used as a resource or as a strategy to generate additional revenue (Gassmann, 2006). To channel these exchanges and marry them to potential internal R&D efforts, the concept of the business model is revised and becomes central to the firm's innovation strategy (Chesbrough and Rosenbloom, 2002; Chesbrough, 2003a; Chesbrough, 2006b; Huston and Sakkab, 2007; Chesbrough and Schwartz, 2007). Thus far, the storylines on open innovation appeal to practitioners, and the majority of studies in this field read very well indeed. However,...