·       
Open innovation
allows your company to expand the breadth of ideas, opportunities and know how
while minimising the technical and market risks associated with the innovation.

·       
An open innovation
community can give your company a competitive advantage. This is especially
important in challenging economic times.

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·       
It is a profitable
way to innovate. It results in reduce costs, accelerate time-to-market,
increase differentiation in the market and also create new revenue streams for
your company.

Benefits of Open Innovation-

 

The advantages of open innovation projects are widely discussed in
innovation management research and practice (e.g., Man & Duysters, 2005).
Particularly, small and medium-sized enterprises (SMEs) are expected to gain
most from open innovation collaborations due to their inherently limited
capabilities (Lee et al., 2010; van de Vrande 2009).

 

·       
Building a better
business model is better than getting to market first.

·       
External R&D
can create significant value whereas internal R&D is needed to claim some
portion of that value.

·       
In open
innovation, there is a need to work with smart people inside and outside of the
firm.

Principles of Open Innovation-

 

Coined by Berkeley professor Henry Chesbrough,
the term “open innovation” refers to
the collaboration between companies, individuals and public agencies to create
innovative products and services and, in the process, share its risks and
rewards.

 

Randall Rothenberg, President and CEO of the Interactive
Advertising Bureau, believes that building upon knowledge from internal and external
ideas will result in an “ongoing, evolving community of users, doers, and
creators.

 

It is a paradigm
that assumes that firms can and should use external ideas as well as internal
ideas, and internal and external paths to market, as the firms look to advance
their technology.

Open Innovation-

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