Engineering & IT

Open innovation, a collaborative innovation approach

7.4.2023
7
min.
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Sébastien Deschaux
Director of innovation and R&D. Research expert in innovation sciences. Partner.

Do you want to innovate and accelerate your innovation processes? Dare to adopt an open and collaborative innovation approach! It's time to break down the barriers of industrial secrecy and open up the closed and confidential world of innovation, not only to other companies but also to university research organizations and potential customers.

Beyond the limits of the company, open innovation offers creative and competitive innovation opportunities, thanks to the pooling of R&D resources, human and technical resources, skills, partner networks and investments.

What is open innovation? Towards new possibilities to innovate

"[...] open innovation involves the use of knowledge inputs and outputs for the purpose of accelerating internal innovation and expanding markets for external use of the innovation." Chesbrough 2006 1

In 2003, Henry Chesbrough, director of the Center for Open Innovation at Berkeley, called for a shift away from the paradigm of closed innovation and industrial secrecy in corporate R&D management. He introduced the term " open innovation " to promote a new approach to innovation based on collaboration between multiple actors: startups and large companies, communities, researchers, future users, etc.

Open innovation thus refers to a large ecosystem of partners that goes beyond the limits of companies and organizations, in order to invent innovative solutions that benefit everyone. The open innovation model therefore combines the company's internal innovation activity with external resources: external R&D sources, infrastructures, human and material resources, networks of customers, suppliers or investors, corporate culture, etc.

Open innovation helps to link two major types of players: startups as drivers of innovation and large corporations as financial investment power.

Open innovation also refers to distributed innovation processes between public and private organizations, such as universities or colleges, and innovative companies.

Open innovation VS open source

Both open innovation and open source approaches challenge the boundaries of the enterprise and share the same desire to work for the common good, with a focus on collaboration and skill sharing. However, open source is more specific to software development, whereas open innovation can be applied to any type of service. Furthermore, opensource refers to technologies that are freely accessible without financial compensation. As for open innovation, it leaves the economic exchange framework and the question of intellectual property open. It is a collaborative innovation approach that may or may not involve licensing rights between companies and organizations.

Benefits of open innovation or why do open innovation

Industry 4.0 and accelerating the pace of business innovation

The 4th industrial revolution, or Industry 4.0, has increased thesocial and technological innovation performance of companies. But it has also shortened the life cycle of products and imposed an accelerated pace of innovation.
However, this acceleration of the innovation process can hardly rely on the internal resources of the innovating company alone. This is why start-ups and large corporations alike have an interest in adopting an open innovation strategy and partnering with external stakeholders, in order to maintain their competitiveness by accelerating their creativity.

Pooling of skills and resources for efficient and creative innovation teams

Unity is the strength of the innovation process. When it comes to research and development, collaborative work is faster and more efficient.

Open innovation reduces R&D costs and shares the risks of investment between different organizations. Moreover, the diversification of skills, business processes and points of view reduces the risk of innovation slippage.

Finally, open innovation accelerates the time-to-market of innovative products and services, by sharing tasks between different organizations. The return on investment of open innovation is thus faster.

A win-win innovation approach for large groups and start-ups

The co-creation of innovations between large groups and startups allows the financial power of large groups to be combined with the technological innovation power of startups.

For large corporations and established companies, startups represent powerful innovation drivers and an invaluable creative dynamic. The small scale of startups and their agile structure allow them to innovate faster.

From a startup's point of view, partnering with a large group considerably increases its life expectancy, thanks to not only financial but also organizational support. It is the opportunity to benefit from the popularity, credibility and visibility acquired by the large group on the market, from its network and partnerships.

Open innovation at the service of territories for social innovation

Many local authorities are partnering with large groups and startups to develop innovative social solutions. In the territories, open innovation stimulates innovation around local issues. It attracts talent and companies, creates jobs, and improves the service offer.

How to make open innovation a driver of innovation in the company?

We can distinguish five levers to enter open innovation: incubators, gas pedals, idea competitions, corporate venturing and open API or open Data.

The incubator: promoting the emergence of start-ups from innovation projects

An incubator is a public or private ecosystem for supporting innovative projects, to encourage the emergence of start-ups. The incubator often offers a co-working space to encouragemutual aid between innovation teams. It is also a support and consulting structure, technological, marketing, legal and accounting. Incubated start-ups have access to a network that facilitates fundraising, economic development and access to public research. We distinguish :

- Private incubators, initiated by large companies;

- Public incubators that aim to transform technologies developed in public research structures into innovative companies.

- Incubators attached to the grandes écoles such as Centrale or Polytechnique;

- The European Business and Innovation Centers (EBC);

- Local government incubators, attached to a region or a metropolis.

How to find a business incubator?

To identify the right incubator for your innovation project, you can contact the French Tech community in your city, which brings together most of the innovation players in France.

Serving territorial innovation ecosystems, the Retis network supports the creation and development of innovative companies.

Finally, in the Paris region, two online platforms can help you in your incubation projects, the one of the city of Paris, and the agency Choose Paris Region.

Innovative company gas pedals

A business gas pedal is a program for companies that are beyond the incubation stage but need support to become stable and self-sufficient and grow faster. An accelerator program lasts between two and six months. It helps the company meet key development challenges: internationalization, digital transformation, strategic thinking, presenting innovation solutions to investors, etc.

You can find here the different gas pedals of the French Tech Springboard program classified by region.

Here are the gas pedals of the Public Investment Bank Bpifrance.

Innovation competitions to challenge your innovative solutions

Financed by public organizations or private companies, competitions or idea challenges are powerful levers for open innovation. The challenge organized by a large group, a school or a community, puts candidates in competition to identify the most innovative solutions and offer a partnership to the most promising startups. Innovation competitions are an effective tool for monitoring innovative solutions emerging on the market, and represent a way to externalize research and development costs.

At the heart of companies, fablabs, innovation labs or hackerspaces are research and development structures that are particularly suitable for organizing innovation competitions.

Multiple competitions and calls for private projects intended for start-ups, VSEs and SMEs are published daily. There are also competitions specially designed for young creators of innovative companies under the age of 30. Finally, it is possible to participate in national competitions for the creation or takeover of companies.

Corporate venture: investing in innovation to explore new markets

Corporate Venturing refers to the investment of a large group in a small innovative company, through the financing of ambitious innovation projects. For large companies, the aim of Corporate Venture is to promote innovation in their sector of activity and to explore new markets. The support is not only financial but also strategic, and allows the new company to be part of a promising network.

Open innovation projects in IT development: Hackatons, Open Api and Open Data

In the IT development sector, open innovation also involves the organization of events such as hackathons or programming marathons. These events allow developers to get together to work in a collaborative way.

In addition, a company can decide to open up some of its data and digital applications (API) to external communities of developers via a dedicated portal. This opening of digital innovation allows the rapid development of new web or mobile applications, innovative solutions for the Internet of Things, simplified and ergonomic user interfaces, etc.

Challenges of open innovation: trust, transparency, sharing and social innovation

The main challenge of open innovation is the development of a relationship of trust between stakeholders with diverse backgrounds, expertise and interests. To be virtuous and sustainable, this collaborative innovation approach requires win-win concerns, common objectives, and principles of transparency and knowledge sharing.

Moreover, start-ups, large groups and research laboratories have major cultural differences in terms of work methodology, communication tools and strategic issues. Taking up the challenge of collaborative innovation thus implies finding a mode of communication and organization capable of taking advantage of the strengths of each entity. Social innovation, in the service of complex social issues, can be a powerful reason for uniting innovation teams around common values.

You want to innovate by creating shared value? The human and collaborative adventure of open innovation needs your creativity and your commitment.

1: Chesbroughand Crowther, "Beyond high tech: early adopters of open innovation inother industries", R&D Manage.36 (3) 2006, pp. 229-236.

Sources:
- Mubarak M.,
"Industry 4.0 technologies, digital trust and technological orientation: What matters in open innovation?" Technological Forecasting and Social Change, Volume 161, December 2020.
- Saura Jose Ramon,
"Exploring the boundaries of open innovation: Evidence from social media mining", Technovation Volume 119, January 2023.
- Territory Bank,
"Open innovation structures: creating value for territories", June 2021.
- Hub Institute,
"Open innovation: towards growth and beyond", March 25, 2022.March 25, 2022.

Sébastien Deschaux

Director of innovation and R&D. Research expert in innovation sciences. Partner.

Serial entrepreneur, engineer, incorrigible scientist, passionate about innovation, Lean Startup expert, activist for a better world. My job is simple: to transform innovative project ideas into profitable, high-growth businesses. To do this, there is no better strategy than to focus the value proposition until customers dream of buying. Then it's 100% action: sell, convince, develop, deliver and move forward. For project owners, working with me can be challenging. But it's also a guarantee to move forward at lightning speed, and to avoid spending several years of one's life living on the sidelines without moving forward on a project.

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What is open innovation?

It is a global way of thinking about the company's innovation strategy. It is open to external contributions and structured by incoming and outgoing knowledge flows. This renewed approach to innovation, attentive to the unexpected, opens the company to the outside world and breaks down the linear processes of value creation to increase efficiency.

What is agility?

It is the ability (of a team or an organization) to create products or services by consistently delivering value, while responding to change, in an uncertain and turbulent environment.

What is Business Design?

It is the application of human-centered analysis methodologies that allow the transformation of an idea into a long-term viable business. There are three fundamental levers in the Business Design process: desirability, feasibility and economic and financial viability.

What is Data Mining?

It is a process of analyzing massive volumes of data and Big Data from different angles in order to identify relationships between data and transform them into actionable information.