Is Your Company Ready for Open Innovation Harvard Case Solution & Analysis

Many industrial companies are trying to benefit from open innovation, which involves active cooperation with external partners in the innovation process. Many companies are now acquiring technology from external sources in order to enhance and accelerate their internal processes, innovative authors call inbound open innovation. Companies are also increasingly transfer some of its proprietary technology from other companies with such as licensing, an approach known as outbound open innovation. The researchers examined the role of employee relations in the open innovation by large-scale comparative study of German industrial companies. The authors conclude that the employee relationships that contribute to domestic innovation often impede the successful implementation of the strategy of open innovation. But the researchers found that a group of companies that pursue inbound and outbound open innovation achieved the highest average return on sales. However, companies that have been traditionally pursued innovative strategies was higher than average return on sales compared to the group of companies that transfer their own technology to others, but do not get a lot of technology from external sources. These data, the authors note, suggest that focus only on outbound innovation can be dangerous, as the company runs the risk of its transmission "crown jewels." The authors note that their results emphasize the need to change the attitude of the staff, if managers seek to implement a strategy of open innovation, managers, they say, it is necessary to report on their open innovation strategies for employees of the executive champion for them and develop appropriate incentives and institutional arrangements for promoting open innovation. "Hide
by Martin Hoegl, Ulrich Lichtenthaler, Miriam Muethel Source: MIT Sloan Management Review 4 pages. Publication Date: 01 Oct 2011. Prod. #: SMR400-PDF-ENG

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