Transcript The Era of Open Innovation - Technion – Israel Institute

‫מציגים‪ :‬רעות סינטר‬
‫אביעד חבל‬
The Kinds of Innovation
There are two kinds of Innovation:
• Close Innovation
• Open Innovation
The Closed Innovation Model
In Close Innovation, a company generates, develops and
commercializes its own ideas.
The Open Innovation Model
In Open Innovation, a company commercializes both its
own ideas as well as innovations from other firms and
seeks ways to bring its in-house ideas to market by
deploying pathways outside its current businesses.
From Close to Open
The main factors for the transformation:
• The rise in the number and mobility of knowledge
workers.
• The growing availability of private venture capital.
These factors gave the scientists and engineers the
ability to pursue a discovery when a company doesn’t
pursue it in time.
How Prevalent Is Open Innovation?
All industries have been or will be migrating to Open
Innovation. They changed their R&D from internal to
external.
For example:
 Computers
 Semiconductors
 Telecommunications systems equipment
 military weapons and communications systems
The Different Modes of Innovation
 Funding Innovation
 Generating Innovation
 Commercializing Innovation
Funding Innovation
 Innovation investors – they provide funds to small
independent businesses, and help move ideas out of
corporations and universities into the market through
creation of startups.
 Benefactors –benefactors focus on the early stages of
research discovery, they get a first look at the ideas and
can choose to found those that seem favorable for their
industry.
Generating Innovation
 Innovation explorers – specialize in preforming the
discovery research function that previously took place
within corporate R&D labs.
 Innovation merchants – like the explorer but their
activities focused on a narrow set of technologies.
 Innovation architects – in order to create a new
valuable product they divide the system into pieces
allowing each company to focus on one part.
 Innovation missionaries – people and organizations
that create and advance technologies without thinking
of profit.
Commercializing Innovation
 Innovation marketers – focus on developing a deep
understanding of the current and potential needs in
the market in order to profit from market ideas.
 Innovation one-stop centers – take the best ideas in
the market and deliver it to their customers at
competitive prices. Unlike marketers, they have
unshakable connection with the end users.
In conclusion
 External R&D can create significant value.
 Companies don’t have to originate the research in
order to profit from it.
 Building a better business model is better than getting
to market first.
 Making the best use of internal and external ideas.
The Open Innovation is so unstoppable that companies
are “been forced” to migrate to open innovation like
LEGO company.