The Choice Between Closed and Open Innovation
In the world of innovation, two predominant approaches are emerging: closed innovation and open innovation. Each of these approaches finds its place in different contexts and offers specific benefits for stimulating creativity and growth.
Closed Innovation
Innovative solutions and ideas emerge from available internal resources. This means that the company draws on its own pool of talent, skills and expertise to develop new ideas and products. This approach is particularly suited to highly specialized industries where confidentiality and protection of all the components of innovation (technical creation, aesthetic creation, unique know-how, etc.) constitute vital assets for sustainability of the company.
Open Innovation
Open innovation on the other hand, relies on collaboration and the exchange of ideas across the company’s boundaries. It promotes interaction with external partners, such as other companies, universities, startups or customers. The objective is to bring together a diverse pool of expertise to generate innovative ideas and develop innovative, if possible disruptive solutions. This approach responds to the uses and needs of constantly evolving sectors for which the ability to constantly adapt to new trends is crucial.
The Right Balance
In reality, most companies take a hybrid approach, combining elements from both closed and open innovation. This strategy gives them the advantage of leveraging internal resources while being open to outside ideas and talent. The key lies in finding a balance between creativity and structuring.
5 Myths About Innovation to Erase:
The Key is to have ideas: contrary to popular belief, an innovative idea represents only 10% of the innovation process. To succeed, you must also devote 40% of the effort to execution and 50% to commitment to achieve the set objectives and be able to benefit from them.
The added value of an innovation cannot be measured: innovation is not a question of talent and luck. Innovative companies increased their performance by 17% in 2020, demonstrating that innovation can be managed and measured strategically.
Innovation is a race against time: innovating can take time, sometimes years. The speed of innovation is related to the time from conception to market introduction. Some major innovations may take decades to come to fruition.
Innovating means doing R&D: Innovative companies do not necessarily have the largest research and development budget. All companies, regardless of their size or sector, have the potential to innovate. Barriers to innovation go beyond budget and include development time, idea selection, coordination, marketing, or simply a lack of ideas.
Innovating is risky: inaction is very often a riskier choice. 80% of executives believe their business model is at risk of being outdated in the future. Innovation is the best way to anticipate future changes, respond to emerging needs and stand out in a competitive environment. However, innovation does not happen by chance, it requires a strategy and a well-structured process.
In short, innovation is a key driving force for growth and competitiveness. It can be fueled by internal or external ideas, but it always requires proper planning and management to succeed. Businesses that understand these fundamentals are better prepared to thrive in an ever-changing world.
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