March 13, 2016

Purdue, Accenture examine open innovation in large companies

WEST LAFAYETTE, Ind. — The idea of open innovation practices is embraced by U.S. and European companies but not always utilized strategically, according to a new joint study conducted by Purdue University’s Research Center for Open Digital Innovation and global professional services company Accenture.

The study “The Smart Way to Open Your Innovation Process,” examined the use of open innovation in the research and development operations of large corporations based in the United States and Europe, including Hewlett-Packard Corp., Eli Lilly and Co. and Ford Motor Co.

Open innovation is the concept firms use to expand beyond their internal research and development and make use of external sources to identify new technologies, develop new products and services or launch new platforms. Digital technologies play an important role by providing new ways to interact and exchange data and information with external partners.

 All of the companies examined have more than 1,000 employees and revenue of at least $250 million.

The core research team included: Sabine Brunswicker, associate professor of innovation and director of Purdue’s Research Center for Open Digital Innovation (RCODI); ‎Raghav Narsalay, managing director for innovation and risk management research at Accenture Research; and Mehdi Bagherzadeh, assistant professor of innovation management at NEOMA Business School and a research fellow at RCODI.

Brunswicker said, “The study suggests that open innovation remains of strategic value to large firms in the United States and Europe. It also shows managers increasingly experiment with different types of open innovation, such as crowds and communities.”

“However, open innovation is not a one-size-fits-all approach,” she said. “It requires a careful design of the right project ‘mode,’ in order to drive an open innovation project towards success. Managers need to learn how to embrace openness and establish new managerial practices that balance tensions emerging from uncertainty and ambiguity.”

The study found businesses that successfully utilize open innovation follow one of four modes of the concept: contracts, partnerships, open innovation platforms, and open innovation communities. Each mode offers different advantages based on the parameters of the project. The decision on which mode to choose is guided by the complexity of the innovation problem the company is driving to solve, and accessibility of solution knowledge. 

The joint study includes descriptions and results of open innovation cases involving Bosch, Eli Lilly, Evonik, Ford, HP Labs, Pfizer and Samsung. The types of open innovation solutions were studied ranged from Pfizer creating an open innovation contest to create a new packaging development to Evonik starting an open innovation community to find a solution for process technologies.

The project was sponsored by Accenture and the results of the study including eight case study reports are accessible on the Accenture website. A more detailed research report, developed in preparation of the Accenture study by RCODI is accessible via SSRN and the RCODI website. The data collection was jointly executed by RCODI and the Haas School of Business at the University of California-Berkeley.

About RCODI

RCODI is one of the large-scale research centers of Purdue Discovery Park. RCODI is home to scholars and researchers who advance the understanding of open innovation models in the digital age. Through rigorous scientific research and virtual experimentation, the center deepens our understanding of the driver of our society's innovation productivity at the intersection of information systems, innovation studies and data science. 

Writer: Brian L. Huchel, 765-494-2084, bhuchel@purdue.edu 

Sources: Sabine Brunswicker, 765-494-0880, sbrunswi@purdue.edu 

Hannah Unkefer, 415-537-4848, hannah.m.unkefer@accenture.com

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