Open Innovation: The New Imperative For Creating And Profiting From Technology

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In today's information-rich environment, companies can no longer afford to rely entirely on their own ideas to advance their business, nor can they restrict their innovations to a single path to market. As a result, says Harvard Business School Professor Henry W. Chesbrough, the traditional model for innovation--which has been largely internally focused, closed off from outside ideas and technologies--is becoming obsolete. Emerging in its place is a new paradigm, "open innovation," which strategically leverages internal and external sources of ideas and takes them to market through multiple paths. This path-breaking analysis is based on extensive field research, academic study, and the author's own longtime experience working in Silicon Valley. Through rich descriptions of the innovation processes of Xerox, IBM, Lucent, Intel, Merck, and Millennium, and the many spin-offs that have emerged from these firms, Open Innovation shows how a company can use its business model to identify a more enlightened role for R&D in a world of abundant information, better manage and access intellectual property, advance its current business, and grow its future business. Arguing that companies in all industries must transform the way they commercialize knowledge, Chesbrough convincingly shows how open innovation can unlock the latent economic value in a company's ideas and technologies.About The AuthorHenry Chesbrough,(Shortlisted: 2011 Thinkers50 Innovation Award) an adjunct professor at the Haas School of Business, at the University of California, Berkeley, is an internationally respected expert on innovation. He is also a visiting professor of Information Systems at Esade Business School in Barcelona, Spain. Chesbrough has written extensively on the topic of innovation, but he is best known for his work on open innovation, a term that he helped popularize. Open innovation, as the name suggests, describes innovation that occurs beyond the closed doors of a single organization. For example, the open source movement, which created the computer operating system Linux, is an extreme example of open innovation. “Open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology,” says Chesbrough. More recently, Chesbrough, who is an executive director at the Center for Open Innovation at Haas, has turned his attention to the world of services with his latest book Open Services Innovation: Rethinking Your Business to Grow and Compete in a New Era.