· Open innovationallows your company to expand the breadth of ideas, opportunities and know howwhile minimising the technical and market risks associated with the innovation.· An open innovationcommunity can give your company a competitive advantage. This is especiallyimportant in challenging economic times.· It is a profitableway to innovate. It results in reduce costs, accelerate time-to-market,increase differentiation in the market and also create new revenue streams foryour company.
Benefits of Open Innovation- The advantages of open innovation projects are widely discussed ininnovation management research and practice (e.g., Man & Duysters, 2005).Particularly, small and medium-sized enterprises (SMEs) are expected to gainmost from open innovation collaborations due to their inherently limitedcapabilities (Lee et al., 2010; van de Vrande 2009).
· Building a betterbusiness model is better than getting to market first.· External R&Dcan create significant value whereas internal R&D is needed to claim someportion of that value.· In openinnovation, there is a need to work with smart people inside and outside of thefirm.
Principles of Open Innovation- Coined by Berkeley professor Henry Chesbrough,the term “open innovation” refers tothe collaboration between companies, individuals and public agencies to createinnovative products and services and, in the process, share its risks andrewards. Randall Rothenberg, President and CEO of the InteractiveAdvertising Bureau, believes that building upon knowledge from internal and externalideas will result in an “ongoing, evolving community of users, doers, andcreators. It is a paradigmthat assumes that firms can and should use external ideas as well as internalideas, and internal and external paths to market, as the firms look to advancetheir technology. Open Innovation-