Open Innovation: Models and Best Practices

Alfredo Adamo
Nov 20, 2018 · 8 min read

Evolution Of a Winning Model

The term Open Innovation refers to a paradigm that dates back to the early 2000s, a period in which it was essential to give a precise direction developing both new technologies and new companies.

Benefits for the Current Market

The dynamism and rapid evolution commonly found in today’s markets require a broad rethinking of businesses as opposed to the classic boundaries that businesses are currently accustomed to.

Closed Innovation vs. Open Innovation, Chesbrough, Oxford University Press (2006)

Assumptions

The implementation of such a complex and strategic corporate organisational strategy, requires the scrutiny and respect of some important prerequisites that must exist so that the Open Innovation fits best in the business environment.

  • Different sources of knowledge to exploits than in the past. Einstein said: if you can not solve problems using the same level of knowledge with which this was created, in the same way you can not imagine creating truly disruptive products and business models, without constantly changing your point of view.

Internal Organization

Banalizing the concepts mentioned above, for most people Open Innovation corresponds to a mere collaboration, mostly commercials, with external actors.

  • Involvement of the Middle Management in achieving the objectives set by top management
  • Clear and transparent identification of responsibilities for each of the different streams of open innovation, that will empower all the players in the field and makes sure that things “happen”.

Classic tools for companies

What are the tools that are usually used to import the paradigm in companies?

CALL FOR IDEAS, HACKATHON, AWARDS

In many cases, companies are looking in the market for new ideas that can improve or revolutionize their businesses or their internal processes.

INCUBATORS AND COMPANY ACCELERATORS

To introduce innovation into the company, another important tool could be “Incubators” and “Business Accelerators”. The contingency is a must because all too often these tools are used to disguise simple business spin-offs or to constrain the applicants so rigidly to distort the entire concept of Open Innovation (i.e. the exchange of information between different companies aiming to a total growth of the entire system).

PARTNERSHIP

With the spread of Open Innovation, partnerships acquire a new value, becoming an instrument of growth no more limited to single project’s extemporaneousness, but with a long-term sight relying on a much wider audience.

ACQUISITIONS

Acquisition is not a new concept for companies, even though it is now considered one of the main tools to do Open Innovation.

The Alan Advantage Approach

This increased need for Innovation has led to the emerging of many business entities on the market.

Open Innovation model based on a Marketplace
  • High specialization on the themes of Artificial Intelligence and on new technologies in general;
  • Careful selection of partners and corporates (for reliability and competence of the team, technological skills, the innovation of products / services offered, and a common business vision) in order to find an innovator in your own network before having to look for it in the rest of the universe of innovators;
  • Confidence. Alan Advantage’s relationships with clients and his own network are based on a deep knowledge and esteem of each other’s competences that lead to strong trust on anyone belonging to the network, thus facilitating the creation of new relationships, and the finalization of very complex projects.
  • Low latency time (from the customer’s request to the first PoC), on average five days;
  • High retention of customers, who continue to take advantage of company consultancy for other projects after the initial one.

Conclusions

Implementing new Open Innovation projects that imply such a profound revolution of the company’s business is anything but trivial. In addition to highly technical skills, a firm needs a strong commitment by top management.

Alan Advantage

Innovation Management and Business Angel Investing