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Open Innovation

Open Innovation. Marko Torkkeli Professor of Technology and Business Innvations at LUT Industrial Management Vice-dean, Faculty of Technology Management. Motto: if you are not open, you are closed!. LUT – Kouvola unit Prikaatintie 9, 45100 Kouvola marko.torkkeli@lut.fi.

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Open Innovation

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  1. Open Innovation Marko Torkkeli Professor of Technology and Business Innvations at LUT Industrial Management Vice-dean, Faculty of Technology Management Motto: if you are not open, you are closed! LUT – Kouvola unit Prikaatintie 9, 45100 Kouvola marko.torkkeli@lut.fi

  2. Questions we need answers for? • What does open innovation (OI) mean to me and my company? • How can we create an open innovation culture in our company? • How can we overcome NIH & NSH syndromes and organizational inertia?

  3. Potential goal € £ $ ¥

  4. Intangible asset market value

  5. Quality vs numbers Footer

  6. Why Open Innovation? • Time to market is shorter • New knowledge/technologies beyond usual suspects • Access to additional competencies and resources • Cost reduction (faster and cheaper?) • New ideas, new communities (tribes) • Access to new markets

  7. R+D+C Footer Mortara et al, 2009 p. 12

  8. Three archetypes of open innovation system Outside-in Process Integrating external Knowledge, Customers and Suppliers Inside-out Process Bringing ideas to market, Selling/licensing IP and Multiplying technology Scanning of new Technologies Proto- types Development Product Coupled Process couple outside-in and inside-out process, working in alliances with complementaries Gassmann & Enkel, 2007

  9. What is Open Innovation? Open innovation means that companies (COUNTRIES, INDIVIDUALS, TEAMS) should make much greater use of external ideas and technologies in their own business, while letting their unused ideas be used by the other companies (CROSS-BORDER). This requires each company to open up its business model to let more external ideas and technologies flow in from the outside and let more internal knowledge flow to the outside. Chesbrough, 2006 – modified

  10. Different recipties Corporate Venture Capital Open source -aloitteet ulkopuolisen tiedon ottaminen käyttöön oman tiedon siirtäminen ulos Sisään lisensointi IP:n myynti (patentti)luovutus Yritysostot Ulos lisensointi Olemassa olevan tiedon hankinta Tiedon siirto Avoin innovaatio yrityksestä – uudet liiketoimintamallit mallit Avoin innovaatio yritykseen Avoin innovaatio Uuden tiedon luonti yhteistyössä Uuden organisaation luonti Itsenäiset innovaattorit Spinoff Yhteistyösopimukset Yhteistyötahot Venture Yliopisto/korkeak.yhteistyö Yhteisprojektit Joint Venture Strateginen allianssi Innovaatioverkosto Toimittajayhteistyö Konsortio Asiakasyhteistyö Yhteispatentit Muut instituutiot Torkkeli et al, 2007 Muut yritykset

  11. Skills needed for OI Mortara et al, 2009 p. 42

  12. 10 reasons on... How company may failure on OI • Proper business reasons to engage OI not identified • OI initiative copied from competitors (imperfectly) • Employees, partners and customers do not get it • Different organizational units (especially operational) not fully aligned with OI • Executives cannot tolerate risk of loosing control • “Best guys” in traditional business are not necessarily what is needed in order to succeed with open innovation • Internal innovation process must work first, then you can get results on OI. • Focus on own gain will not lead true win-win Lindegaard, 2010

  13. (Open) Innovation intermediary • An intermediary can provide an opportunity to economize on a critical area of efficient investments – the expertise to sort profitable and unprofitable ones. • Innovation intermediaries are those who facilitate companies' access to external technologies and solutions. Adapted from http://www.mindtrek.org/pdf/presentations/social_media/Open_Innovation_Mindtrek.pdf

  14. Intermediaries and communities Draft by Lopez, Vanhaverbeke and Torkkeli, 2009

  15. Research & Business connection • University partnerships – stipends to PhDs • SMEs and MNCs – M&As • Vision and insight • Test arenas • Explore beyond usual suspects

  16. OI instruments • Exhibitions and poster sessions • Call for proposals/papers • Grants • Intermediaries • Publicly funded projects • Campaings and competitions • Research contracts • Interns

  17. Evaluation of OI actions with universities and research organizations • Number of patents (value) • Commercialized ideas • Number of projects • Impact, value captured Marinelli, 2010

  18. OI articles in Journals *2010 is for 9 months Torkkeli, 2010

  19. Open Innovation is over-performing Torkkeli et el (2007), Implementing Open Innovation in Large Corporations: Challenges and Financial Outcomes

  20. Future • From concept development to performance measurement • OI is fully integrated in innovation management practices • The new ‘business as unusual’ becomes ‘business as usual’ • New set of skills needed to cope with open innovation at companies and intermediaries

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