Open Innovation 101: Easy Ways to Get Started

Open innovation comes in all shapes and sizes, and how to implement it in your company can sometimes feel daunting. But it’s easier to get started than it might seem!

In this blog post, which is based on our recent webinar with HYPE’s very own Open Innovation expert Oana-Maria Pop, we share Oana’s expertise about open innovation and how you can implement it. Let’s dive in!

What is Open Innovation?

The term “open innovation,” was coined by Henry Chesbrough, an American organizational theorist, adjunct professor, and the faculty director of the Garwood Center for Corporate Innovation at the Haas School of Business at the University of California two decades ago in his book “Open Innovation,” means the process of using knowledge, both inside and outside organizations, to invent and commercialize something new. The process is strategic, collaborative, and directional as it can facilitate inside-out, outside-in, and coupled processes.

Busting Open Innovation Myths

Just as important as understanding what open innovation is, we need to understand what it is not:

Open innovation is not always open

Many companies restrict access to certain resources or data to a select group of collaborators to protect their intellectual property. Hence, in these cases, even if a company has an open innovation program, it might be the case that not everyone can participate or access these resources freely.

Open innovation is not always free

Open innovation doesn’t mean “free” ideas; setting up an open innovation program and gathering ideas needs resources. Some organizations, especially smaller ones or those with limited resources, may lack the staff, technology, and financial capacity to start open innovation.

Open innovation is not the same as open-source information programs

Despite some similarities with open-source information programs, open innovation is not the same. For example, in open innovation, companies often protect their intellectual property and may collaborate with external stakeholders only under specific agreements. Open-source information typically involves sharing information or designs without restriction and allowing others to use and modify it.

What to Consider Before Starting Open Innovation 

Before you implement open innovation in your company, assess whether your organizational context allows it by asking:

• What types of external relationships are currently in place with your company? How many of them are ongoing? For example, how many of those were created within the last year, and how are they evolving?
• Is there collaboration with strategic suppliers or universities nearby?
• How do employees and stakeholders handle external knowledge?
• What is the stakeholders’ attitude? Are they comfortable with sharing their prototypes or recent projects?
• Can you identify some healthy habits from those collaborations?

Rather than building open innovation from scratch, it’s more effective to understand what you already have in place and what works for your company. This will help you to characterize the innovation culture in your company, help you make the right decisions, and move forward at the right pace. You know how the saying goes: You need to learn how to walk before you can run.

Pro Tip: Carry out short surveys or interviews with key stakeholders before implementing open innovation to discover their attitude to collaboration with external stakeholders and what’s already been achieved. Try to find out whether your company suffers from the Not-Invented-Here syndrome and whether external ideas are blocked. 

Open Innovation Readiness Assessment

Before you start implementing an open innovation strategy, it’s important to assess whether your company is ready for it.  Conducting an open innovation readiness assessment will give you a deeper understanding of your current innovation hotspots –  the regions characterized by a high concentration of innovation and entrepreneurial activity –  and identify the most forward-thinking employees in your team who can potentially support your open innovation program. HYPE Innovation consulting team can help you to conduct this assessment. 

Four Strategic Steps Toward Implementing Open Innovation

1. Curating and Uniting Your Knowledge Streams

The first step is to streamline your existing  knowledge streams:

• Index, curate, or revisit external interactions, e.g., from old notes, and MS Teams dialogs.
• Write down your view on collaboration a document
• Highlight areas of interest and priorities for collaboration

Pro Tip: Create a single “source of truth” by creating a trend radar, a visual tool used to monitor, assess, and prioritize emerging trends, technologies, or ideas.

2. Opening the Question to the World

If you already have challenges on your plate and want a more straightforward dive into open innovation, try involving outside participants. For instance:

• Establish a list of your current problems and ask partners for suggestions about how to solve them
• Valorize internal research: Offer your company’s developments as a service to others
• Look for cross-industry collaboration opportunities
• Crowdsource the next big thing to work on: Allow external participants to contribute to the design of your strategy in a centralized, secure, and meaningful way through innovation management software 

Pro Tip: The further away the contributor is from your business, the more creative their input will be – so don’t be afraid to involve stakeholders that don’t have an immediate link between you and them.

Open Innovation Case Study: Liebherr

German-Swiss multinational equipment manufacturer Liebherr involved students, wine lovers, and their customers in the design process for their new wine coolers. Although it started as an experiment, it led to a fully-fledged open innovation project and the successful development of new templates for Liebherr’s wine coolers. 

3. Designing Better, More Impactful Touchpoints

Creating more effective touch points with your partners is another helpful step toward the implementation of open innovation:

• Set up recurring strategic meetings to exchange knowledge, discuss trends, and imagine the future together
• Organize special events such as innovation festivals, “Dragons Den” type events, innovation days, and upskilling workshops

Pro Tip: Substitute ad-hoc meetings with known partners with ongoing dialog.

4. Visualize Your Entire Supply Chain or Ecosystem

Carry out a “mapping” exercise to visualize and analyze different elements of your innovation journey to understand:

• Your innovation capabilities
• Your focus areas
• The technological capabilities of your open innovation ecosystem
• The focus areas of those you work with

In a great example of visualization, a global distributor of off-grid energy SHV Energy has 3-D printed their supply chain to visualize it.

Pro Tip: Create a network graph and observe the changes over time.

Your Step-by-step Journey Towards Open Innovation

Let’s sum up the process for starting open innovation in your company:

1. Readiness assessment: Explore your internal appetite for collaboration. Discover what motivates you and your team.
2. Prepare the ground: Explore how you’ll pursue open innovation: online, offline, or in hybrid form? Check location and hosting options to ensure a smooth start.
3. Define the use case: Define your needs, ideal audience, and contributors. Make sure there will be ownership for whatever data you collect.
4. KPIs and metrics: Define what success looks like in the short, medium, and long term. Choose simple KPIs and build a dashboard.
5. Plan and launch: Plan communications and launch your activity. Monitor progress and adjust if necessary.
6. Evaluate and report: Evaluate the external inputs and reward your contributors. Check whether you’ve met your goals. Report back to your community.

Open innovation offers a powerful path to success that’s accessible to everyone. Embark on the journey, leverage your strengths, and encourage collaboration!