Innovation Strategy 3: Open Innovation Theory

A good way to look at ‘open innovation’ is, as the opposite of ‘closed innovation’. Traditionally companies regarded the knowledge and experience they held were their greatest assets and their exclusive property, which enabled companies to drive their innovative process and enabled them to expand their business activities (Klaster LifeScience Kraków, 2014).

By implementing Open innovation, Ford can make greater use of external ideas and technology in their own business and in turn let their unused ideas be used by other players in the automobile industry. (Chesbrough, 2005)

Chesbrough (2005), stresses that the most important factor for the development of open innovation is the dramatic rise in the number and mobility of knowledge workers, making it increasingly difficult for companies to control their proprietary ideas and expertise.


Henry Chesborough's Open Vs Closed Innovation
Henry Chesborough’s Open Vs Closed Innovation


I would like to highlight the various possible outcomes in open innovation in the pic above. Newmarket is a strong possibility due to technology spin-offs as seen with many companies like GE & Cisco to name a couple (Lindegaard, 2014).

In Ford’s case, it would augur well for the company if it looks outwardly and internally for innovative ideas. Ford currently has couple of an online platform for idea submission.

1.An open plat for people to submit ideas. (

2.The second site/centre Ford currently has is a dedicated Research and Innovation centre, which was opened as recently as Jan 2015, (

In open innovation, having a clear focus on the anticipated business focus is the best basis for driving an innovation strategy. In Ford’s case, it has identified challenges in areas such as connectivity, mobility, autonomous vehicles, big data analytics and customer experience.

Open Innovation Drawbacks

Open innovation has its own risks and drawbacks associated with it. Some of the risks which Ford has to be aware of are risks related to workforce, knowledge sharing, the complexity of collaboration, market tensions, client pressures, access to finance, technology advances and demands related to intellectual property rights protection. (CORAS and TANTAU, 2014).


Klaster LifeScience Kraków (2014) Open innovation 02 – what is “open innovation”? Available at: (Accessed: 24 May 2016).

Chesbrough, H.W.W. (2005) Open innovation: The new imperative for creating and profiting from technology. Boston, MA: HARVARD BUSINESS SCHOOL PRESS, Boston, Massachusetts, U.S.A.

Lindegaard, S. (2014) 15 examples of open innovation between big companies & startups. Available at: (Accessed: 26 May 2016)

CORAS, E.L. and TANTAU, rofessor A.D. (2014) OPEN INNOVATION – THE GOOD, THE BAD, THE UNCERTAINTIES. Available at: (Accessed: 25 May 2016).


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