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Five Factors for Open Innovation

July 12, 2013 15inno 3 Comments

It is my experience that open innovation is going to affect all industries, but some more than others, and some sooner than others.

Overall, I see four external factors that matter here:

1) cycle time for products/services development, 2) money and 3) IPR needed for getting new products/services to market and 4) the level of conservatism in the industry.

The fifth factor is the internal readiness of your own company. This is also the one that is the most important as corporate innovation teams can influence this one the most.

If you consider these five factors, you get a better understanding of whether open innovation is relevant for your company and industry. Personally, I find it to be more difficult for life sciences, financial and service-related industries, but you can always find exceptions in both directions.

In general, I find it interesting to see that open or external innovation is becoming a key component for innovation in almost every industry. Every company can benefit from external input to innovation processes.

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Currently there are "3 comments" on this Article:

  1. Great post. Open innovation is indeed discussed a lot recently. The other thing that I'm interested to see developing, or not developing, is open-source based innovation.

    And regarding your post, I think that fifth factor encloses those other factors, at least partly. A company is more ready if it is not so conservative and it has enough money and IPR (maybe also shorter cycle times for development)

  2. Blaine says:

    As regards the Fifth, environmental factor, a corporation contains heads of businesses each of whom have different degrees of openness. Thus some business leaders embrace Open Innovation whereas another leader rejects it using another factor as the reason. The quick excuse is intellectual property, shortly followed by money. We must recognize the multi-headed creature that comprises a company.

  3. LukeHinson says:

    Innovation follows the the basic risk/reward model: the higher the risk, the higher the reward. As more companies begin to invest wisely in their Open Innovation programs and put in place better tools, processes and methods for managing OI, the risk will come down substantially, thus reducing the pressures on #'s 2, 4, and 5.

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