Open Innovation
Introduction
Open innovation refers to the process through which an organization promotes its framework for innovativeness by using external and internal mechanisms. Dr. Henry Chesbrough is the man behind the popularization of the concept of open innovation. He asserts that sharing of ideas would serve as an essential pillar for enhancing the standards of innovativeness in the world. According to Dr. Chesbrough, open innovation has the inherent capacity to streamline the standards of technology in globe.
Despite the different advantages of open innovation, there are various aspects that serve as significant stumbling blocks towards its implementation. For instance, most organizations are reluctant to cooperate with competitors in sharing innovative ideas. Another significant challenge pertains to the legal framework for intellectual property rights. Addressing these challenges will be helpful towards enhancing the efficiency of open innovation.
HISTORY OF OPEN INNOVATION
Although Dr. Henry Chesbrough is the man credited with popularizing the concept of open source innovation, its history is tremendously deep. This is because of its close association with research and development. Towards the beginning of the 1960s, some organizations started to integrate research and development platforms within their operational frameworks. The trend became more predominant with time as more organizations appreciated the need for innovativeness. This formed the basis of open innovation. According to Dr. Chesbrough, outflows and inflows of knowledge are pertinent towards the enhancement of innovation within an organization (Chesbrough, 2008).
Outflows comprise of knowledge generated internally within a company. This might emanate from the company’s employees or its research division. On the other hand, inflows comprise of ideas and knowledge generated from external systems. This includes other organizations as well as independent individuals. The integration of both knowledge platforms is pertinent towards enhancing the quality of outcomes for open innovation.
Proponents of open innovation emphasize on the need to share innovative ideas. In essence, concealing such ideas only serves to curtail the process of innovative development. It is also essential to note that it is always easier for organizations to build on existing ideas as opposed to generating ideas. Additionally, it is easier for people to develop ideas once they have been given a head-start. These perspectives justify the importance of open innovation in organizational operations. Chesbrough’s insights into open innovation also emphasizes on the significance of resource inputs. It is extremely complex to impellent open innovation platforms without having effective mechanisms for resource allocation. If organizations do not devote adequate resources to open innovation systems, they might easily lag behind competitors (Lindegaard, 2010).
The concept of open innovation also emphasizes on the ineffectiveness of the internal frameworks for research and development within an organization. This is because there are numerous mechanisms for sharing information. Consequently, it is essential to establish adequate mechanisms for value addition of open innovation systems. Leveraging internal ideas with inflows helps in streamlining the capacity of an organization to attain the relevant standards of innovativeness. In the modern corporate environments, most organizations have embraced the concept of open innovation within their operational frameworks.
Reputable firms such as IBM are at the forefront of promoting open innovation. The mechanisms for open innovation have been instrumental towards the enhancement of technological standards in the 21st Century (Chesbrough, 2008). Additionally, it is essential to note that organizations can minimize costs through open innovation. This is because open innovation is highly innovative and consumes minimal time compared to the systems for internal research and development.
CHALLENGES TOWARDS THE DEVELOPMENT OF OPEN INNOVATION
Despite the numerous advantages of open source innovations, there are numerous aspects that serve as significant stumbling blocks for its implementation. Whereas some of these challenges are internal, others emanate from external environments. One of the most outstanding internal challenges for the implementation of open innovation is weakness of internal platforms for research and development.
Although companies can maximize on the ideas generated externally, internal mechanisms for research and development are equally significant. In essence, comprehensive internal frameworks for research and development help in strengthening the awareness of employees about the significance of open innovation. Additionally, the absence of comprehensive frameworks for research and development complicates the capacity of organizations to implement external ideas. The second notable stumbling block for open innovation pertains to the inadequacy of resources (Lindegaard, 2010).
Corporate entities in the modern world strive to maximize profitability. This leads them to be seemingly reluctant about investing in innovative platforms. Additionally, organizational executives perceive such investments as unnecessary platforms for increasing their total expenditures. Consequently, organizations devote minimal resources towards the different mechanisms for open innovation. This is a significant stumbling block for streamlining the standards of innovation around the globe.
Apart from subdued allocation of resources, another perspective that serves as a hindrance for open innovation pertains to intellectual property rights. Legal frameworks in the modern corporate world emphasize on the importance of safeguarding intellectual property rights for organizations and also individual entities. Despite the significance of safeguarding intellectual property rights, it has significantly undermined the standards of efficiency for open innovation. Sharing of ideas is an inherent perspective in a successful framework for open innovation (Chesbrough, 2008). Consequently, the protection of intellectual property rights derails the capacity of organizations and individuals to share ideas about open innovation.
Additionally, stringent intellectual property rights discourage organizations to share ideas because of potential legal implications. Another pertinent perspective that serves as a stumbling block for open innovation is competition among corporate entities. The levels of competition across different industries are extremely high in the modern world. This is because of the emergence of numerous players across most sectors. Globalization is also an essential perspective that has contributed towards high standards of competition among corporate entities. Because of the prevailing trends in competition, organizations are highly reluctant to share ideas with rivals. In essence, organizations perceive open innovation as a platform for weakening their frameworks for attaining competitiveness.
According to Dr, Chesbrough, this perspective has had negative implications upon the advancement of open innovation. Additionally, some organizations perceive open innovation as a platform for organizations sabotage each other (Lindegaard, 2010). This justifies competition as a significant shortcoming towards the successful implementation of open innovation. The focus on multiple innovation networks also serves as another stumbling block for the implementation of open innovation.
Most organizations seek to maximize on the benefits of open source innovation by implementing numerous network models. Whereas such an approach is beneficial in encouraging innovative diversity, it undermines the standards of specialization. In the long-run, focusing on multiple models derails the successful implementation of open innovation. Additionally, focusing on multiple models undermines the capacity of organizations to devote sufficient resources towards research and development. This approach also undermines the successful implementation of open innovation.
IMPORTANCE OF OPEN INNOVATION AND SPECIAL FEATURES
It is fundamentally essential to examine the importance of open innovation in the modern world. This helps in developing effective frameworks for implementation as well as evaluation. The first notable advantage of open innovation is the enhancement of global technological systems. This not only benefits corporate entities but also the society at large. For instance, technological frameworks for communication benefit the entire globe.
Open innovation is also beneficial in terms of enhancing the standards of sustainable development in the world (Chesbrough, 2008). Through research and development, corporate entities can establish the most effective platforms for sustainable development. Additionally, sharing ideas helps in enhancing the capacity of organizations to identify the environmentally-friendly technologies. Consequently, these frameworks justify the contribution of open innovation towards sustainable development. It is also essential to highlight that open innovation serves as an exemplary platform for enhancing the technical skills of employees (Lindegaard, 2010). This is because can easily share with counterparts internally and also externally. The enhancement of the technical skills of employees is extremely vital in terms of strengthening the innovative framework of an organization.
The significance of open innovation is also evident in terms of streamlining the productivity of organizations. In the modern corporate sector, productivity is among the most significant attributes. For a profit-oriented organization, productivity is crucial attribute. Low productivity undermines the capacity of organizations to make profits (Lindegaard, 2010). In contrast, high productivity streamlines the profitability framework for an organization. Through open innovation, organizations can minimize operational costs while also maintaining high standards of innovativeness among employees. These perspectives highlight the significant contribution of open innovation towards boosting the productivity of organizations.
Open innovation also enhances collaboration among corporate entities. Such collaboration is vital in terms of establishing a competitive environment for all stakeholders in different industries. The Millennium Development Goals emphasize on the significance of technological growth towards the advancement of humanity (Chesbrough, 2008). The framework for open innovation conforms to this provision. This is because it enhances the flexibility of sharing ideas among global populations. Consequently, open innovation is a significant platform for streamlining the standards of living across the globe.
Conclusion
The paper analyzes numerous perspectives about open innovation. In addition to the history, the significance and challenges of open innovation are also tackled in the paper. Outflows comprise of knowledge generated internally within a company. This might emanate from the company’s employees or its research division. On the other hand, inflows comprise of ideas and knowledge generated from external systems. This includes other organizations as well as independent individuals. The integration of both knowledge platforms is pertinent towards enhancing the quality of outcomes for open innovation.
Leveraging internal ideas with inflows helps in streamlining the capacity of an organization to attain the relevant standards of innovativeness. In the modern corporate environments, most organizations have embraced the concept of open innovation within their operational frameworks. Reputable firms such as IBM are at the forefront of promoting open innovation. Although companies can maximize on the ideas generated externally, internal mechanisms for research and development are equally significant. In essence, comprehensive internal frameworks for research and development help in strengthening the awareness of employees about the significance of open innovation. Additionally, the absence of comprehensive frameworks for research and development complicates the capacity of organizations to implement external ideas.
References
Chesbrough, H. & West, J. (2008). Open innovation: Researching a new paradigm. Oxford, NY: Oxford University Press
Lindegaard, S. (2010). The open innovation revolution: Essentials, roadblocks, and leadership skills. Hoboken, NJ: John Wiley & Sons
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