The Impact of Open Innovation on Large Companies

Many large companies have embraced open innovation as a viable mechanism for realizing their research and development needs. However, fortunes vary greatly owing to the nature of some projects and the caliber of innovators involved. Whether a project is science or market oriented, success is evaluated based on financial impact, transfer volume, as well as the time it takes to reach the desired goals. Tapping into external sources for collaboration ideas through innovation challenges is not a new concept.

Open Innovation Success Examples

A number of companies have tasted success through the implementation of well-designed open innovation projects. Crowdsourcing product innovations can reap huge rewards that outstrip rewards paid out to participants. Strong innovation management policies enable companies to continually reinvent their operations by injecting fresh ideas that shape the future. Here are a few product innovation examples.

General Mills

General Mills boasts major successes realized through the use of innovation hubs. The firm has placed numerous products on the market much faster than they normally would by using closed research projects, thanks to collaborative efforts of inventors from around the world. General Mills products that were created on their crowdsourcing platform include Fiber One 90-Calories Brownies, Yoplait Greek 100, Natural Valley Protein Bar and the Fiber One Soft-Baked Cookies.

Lego

Lego is another company that has introduced many toy products in the market as a result of its long-standing innovation culture. The firm has undergone phenomenal transformation since its troubled days when it faced total collapse. The turnaround is in part attributed to a strong focus on creating products through creativity and innovation management.

Benefits of Open Innovation

It is no secret that open research projects have the capacity to produce more technology transfers when compared to closed research projects. Market-based partners tend to outperform technology-oriented partners by improving the volume of transfers. In some cases, collaboration efforts between market-based and science-based partners offers better transfer speed. Well-managed projects allow firms to stimulate overall organizational performance through the introduction of innovative products. Entities can easily diversify into high-growth markets. It becomes easier to withstand periods characterized by unfavorable market conditions or stiff competition from new players. Open innovation also helps create a balance between short and long term priorities.