Blog

A space for change makers.

Open vs. Closed Innovation

05.07.2014
Florin Gorgan https://www.flickr.com/photos/floringorgan/4694122800 (CC)

From the suggestion box to complex online structures and tools, open innovation has come a long way. Henry Chesbrough coined the term open innovation back in 2003 in his book by the same name. Since then, many organisations have found success with open innovation. And with success comes the desire to analyse and define that success. So, what is the definition of open innovation?

Chesbrough originally defined open innovation as: “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”.

Quite the opposite to ‘closed innovation’, which assumed that the best route to innovation was to have control over the process (ie. hiring the best employees, keeping data internally, etc.)

For us and open innovation definition is much broader. It enables organizations to function in a new way. A way that empowers co-workers and communities to tackle challenges and improve their organisations. This is not only limited to companies and “classical organizations”.

Open innovation describes a worldwide phenomena where people share ideas and work together through open and transparent networks for commercial or social purposes thanks to the ease of online social collaboration tools and social media.

As the access to education, research and additional job markets increased over the decades, the model of closed innovation needed to be innovated itself. With a larger pool of skilled employees it became harder to keep all of the original or best ideas in one place. It also became easier for employees to potentially leave the firm with their knowledge and ideas and either join another firm or create a startup of their own. Lastly it is virtually impossible nowadays as an organization to provide all knowledge with in its boundaries.

And thus, open innovation was born. The organisations that want to succeed in today’s world needed to open up the doors to the wisdom of the crowd. But what does that mean, exactly? And what are organisations really getting out of it?

Just because organisations are opening up the doors to outside influence, it does not mean that all of the tactics from closed innovation should be discarded. I assume that you still have very skilled and bright employees with great ideas to contribute. In open innovation, organisations need to utilise both internal and external resources. If you have a large organisation, including all employees or departments in a brainstorming process could be a big step in opening up the doors to open communication and open innovation.

At the core of open innovation is the name itself: Open. Open to new people, new information, and new ideas. Most important open to learn from others. The potential in the crowd is far more than the potential in one organisation, no matter how big and bright that organisation is. Instead of innovation focusing on a few bright minds, open innovation turns to many bright minds to share and collect information and get creative.

The definition of open innovation is often sought after, but I wonder if the search in itself is fruitless. If the point of open innovation, or innovation in general, is to find new ways of doing things, then there is no way to pin down a static or specific definition of open innovation. What do you think? How would you define open innovation? Is it possible to define?