Managing Open Innovation Projects with Impact

Abstract

In our recent open innovation executive studies, we learned that open innovation is of strategic value for large firms and an important topic for C-level executives (Chesbrough and Brunswicker 2014, Bagherzadeh and Brunswicker 2015). Large firms increasingly invest in open innovation, and there is evidence that such investment may pay off and increase a company’s productivity. Open innovation comes in many forms (or modes): Bilateral partnerships, IP licensing contracts, innovation contests, communities, and so forth. We learn that firms increasingly experiment with more novel approaches that involve a larger variety of external actors and support collaboration and information exchange across various boundaries. However, engaging in open innovation is accompanied with uncertainty and ambiguity. Open innovation is not a one-way-street with strictly transactional relationships; it requires firms to share information and knowledge with external partners, often with the help of digital technologies. The degree and the mode of information exchange and knowledge sharing tend to vary in open innovation projects, and reduce a firm’s ability to maintain control over sensitive information and value-creation. This further complicates the situation for senior executives when trying to answer questions such as, “How can we manage the uncertainty and ambiguity of open innovation when solving strategic innovation problems? How does the particular choice of one of the open innovation modes – partnership, community, contest – affect our choice of coordinating the interaction with external open innovation actors to align the innovation activities with the firm’s strategic goals?” This study seeks to answer such questions. To do so, our study team took a deep dive into multiple unique open innovation projects to provide a richer understanding of successful management practices.