Exploring Openness in Innovation Process

Abstract

Innovation as a source of competitive advantage helps organization gain superior returns from market. Until recently, innovation activities were generally restricted inside organizations and in some cases to select partners, to limit potential spillovers of knowledge that could undermine the uniqueness of innovation. The last two decades have witnessed the emergence of practices where private enterprises open all or select innovation activities for anyone with interest to participate. Referred to as “open innovation” approach to innovation development, organizations have shown different patterns of openness in their innovation efforts. The patterns of openness refer to the levels of openness and stages of openness in the innovation process. This study classifies openness as “closed”, “semi-open” or “open” depending on the opportunity for external members to engage in organization’s innovation effort. Openness is also exhibited across different stages of the innovation process as idea, execution and value capture. Thus, an innovation can have different form of openness across the innovation process. Based on its findings the study argues that openness is a strategic choice of an organization represented by different levels of openness across different stages of innovation process.

The focus of this study is on understanding the determinants that influence the choice of openness across the stages of innovation process. Based on an in-depth study of innovation projects from five different organizations from automobile, computer and information technology and engineering sector we can conclude that different factors influence openness across the stages. In addition, the influence of factors varies with the stages of the innovation process. This is the first study that has looked at openness across the innovation process. The insights from the study provide guidelines for managing openness in the innovation process of an organization.