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Global trends in

OPEN INNOVATION

José Cláudio C. Terra

Global trends in OPEN INNOVATION José Cláudio C. Terra 1
Global trends in OPEN INNOVATION José Cláudio C. Terra 1

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Battle of Concepts

Challenges to undergraduate students

Battle of Concepts Challenges to undergraduate students 2
Battle of Concepts Challenges to undergraduate students 2

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TerraForum Consulting

Our Mission

Help our clients

to learn, collaborate and innovate in more effective ways

TerraForum Consulting Our Mission “ Help our clients to learn, collaborate and innovate in more effective

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More than 300 projects with leading companies within the last 7 years

More than 300 projects with leading companies within the last 7 years 4 4
More than 300 projects with leading companies within the last 7 years 4 4

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Publishing Portfolio TerraForum Consulting

Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5
Publishing Portfolio – TerraForum Consulting 5 5

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TerraForum Consulting

Innovation Center Portal

TerraForum Consulting Innovation Center Portal 6
TerraForum Consulting Innovation Center Portal 6

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What is Open Innovation?

Innovation distinguishes a leader from his followers. Steve Jobs

What is Open Innovation? “ Innovation distinguishes a leader from his followers. Steve Jobs 7

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Open innovation is the use of purposive inflows

and outflows of knowledge to accelerate internal

innovation, and expand the markets for external use of innovation, respectively."

Henry Chesbrough, 2003

internal innovation, and expand the markets for external use of innovation, respectively." Henry Chesbrough, 2003 8

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Open Innovation Model The Innovation Funnel

Through the open innovation model organizations keep strong relationships with external parties at different stages of the innovation development process

Research

Development

Comercialization

INTERNAL

R&D

Joint Venuture

Licensing External Technology Insourcing Spin-in Divest Spin-off Licencing R&D Services
Licensing
External Technology
Insourcing
Spin-in
Divest
Spin-off
Licencing
R&D Services

Merge and Aquisitions

External Technology Insourcing Spin-in Divest Spin-off Licencing R&D Services Merge and Aquisitions MARKET 9
External Technology Insourcing Spin-in Divest Spin-off Licencing R&D Services Merge and Aquisitions MARKET 9

MARKET

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Through Open Innovation businesses are increasingly open to insights, ideas and collaboration from multiple sources

Through Open Innovation businesses are increasingly open to insights, ideas and collaboration from multiple sources 10
Through Open Innovation businesses are increasingly open to insights, ideas and collaboration from multiple sources 10

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For most companies innovation is a proprietary activity but for

others

Closed Innovation

Most of the smart people in our field work for us

To profit from R&D, we must discover, develop and ship ourselves

If we discover it, we will get it to market first

If we are the first to commercialize we will win

If we create the most and the best ideas in the industry, we will win

We should control our intellectual property (IP) so that our competitors don´t profit from our ideas

Open Innovation

Not all of the smart people work for us, so we must

find and tap into the knowledge and expertise of

bright individuals outside our company

and expertise of bright individuals outside our company External R&D can create significant value; internal

External R&D can create significant value; internal R&D is needed to claim some portion of that value

We 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

If we make the best use of internal and external ideas we will win

We should profit from others´ use of our IP, and we should buy others´ IP whenever it advances our own business model

Open Innovation creates new revenues opportunities

Closed Model Past

Closed Model Present

Open Model

Future

Revenues

Costs

Revenues Costs Revenue Revenue New Businesses Spin -Offs Royalties Revenue Internal Development

Revenue

Revenue Revenue New Businesses Spin -Offs Royalties Revenue

Revenue

Revenue Revenue New Businesses Spin -Offs Royalties Revenue

New Businesses

Spin -Offs

Royalties

Revenue

Internal

Development

Development

Cost Internal Development Development Internal Development

Internal Development Development Cost Internal Development

Internal

Development

Businesses Spin -Offs Royalties Revenue Internal Development Development Cost Internal Development
Businesses Spin -Offs Royalties Revenue Internal Development Development Cost Internal Development

Cost

Internal

Cost

New

Revenues

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How companies will organize themselves to support open innovation approaches?

organize themselves to support open innovation approaches? “ The best manner to predict the future is
“ The best manner to predict the future is inventing it.

“ The best manner to predict the future is inventing it.
“ The best manner to predict the future is inventing it.

The best manner to predict the future is inventing it.

“ The best manner to predict the future is inventing it.
“ The best manner to predict the future is inventing it.
“ The best manner to predict the future is inventing it.
“ The best manner to predict the future is inventing it.

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Companies are creating their own Open Innovation Systems,

that are composed by

their own Open Innovation Systems, that are composed by Processes and Governance Infrastructure Open Innovation

Processes and Governance

Systems, that are composed by Processes and Governance Infrastructure Open Innovation System Partners´ Network

Infrastructure

that are composed by Processes and Governance Infrastructure Open Innovation System Partners´ Network relationship
Open Innovation System
Open
Innovation
System
and Governance Infrastructure Open Innovation System Partners´ Network relationship Organizational structure 14

Partners´

Network

relationship

and Governance Infrastructure Open Innovation System Partners´ Network relationship Organizational structure 14

Organizational

structure

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Key Factors for Open Innovation Success

Key Factors for Open Innovation Success Support and Clearly Defined IP policies Organizational Services for Structure
Support and Clearly Defined IP policies Organizational Services for Structure and Partners Governance Strong
Support and
Clearly Defined
IP policies
Organizational
Services for
Structure and
Partners
Governance
Strong
Relation
Infrastructure
Network
and location
Adequate
Partners
Funding
Open
Innovation
System

Collaborative

Culture

Stakeholders

Support

Strategic

Alignment

Processes and KPIs for Innovation Mgmt

System Collaborative Culture Stakeholders Support Strategic Alignment Processes and KPIs for Innovation Mgmt 15

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Benchmark Study: “Best Practices in Open Innovation Systems”

Participating Companies

Brazil

Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16

Global

Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16
Benchmark Study: “Best Practices in Open Innovation Systems” Participating Companies Brazil Global 16

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Best Practices in Open Innovation Systems (OIS)

Best Practices in Open Innovation Systems (OIS) “ Philips established partnerships all over the innovation stages,

Philips established partnerships all over the innovation stages, from basic research to commercialization.

Besides, developed a technology park in Eindhoven that became worldwide renowned that was capable to attract the strategic competencies to the company.

Philips High Tech Campus offers infrastructure for

their partners, e.g.: suppliers, consultants, patents

office, venture capitalists, governmental research organizations, research specialists.

It also offers paid services, such: offices for rental, incubation and laboratories.

research specialists. It also offers paid services, such: offices for rental, incubation and laboratories. 17

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High Tech Campus, a new concept on Open Innovation

System

High Tech Campus, a new concept on Open Innovation System  Modern technology park  More
High Tech Campus, a new concept on Open Innovation System  Modern technology park  More
High Tech Campus, a new concept on Open Innovation System  Modern technology park  More

Modern technology park

More than 500M in investments ;

Technology-based startups incubation

The design stimulates and forces collaboration between partners

Close to universities

“Research Hotel” concept

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Best Practices in Open Innovation Systems (OIS)

Philips High Tech Campus (Eindhoven)

Best Practices in Open Innovation Systems (OIS) Philips High Tech Campus (Eindhoven) 19
Best Practices in Open Innovation Systems (OIS) Philips High Tech Campus (Eindhoven) 19

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Best Practices in Open Innovation Systems (OIS)

Best Practices in Open Innovation Systems (OIS) “ Telefónica has established a network that involves more

Telefónica has established a network that involves more than 1,000 partners. The company structured 7 research centers, most in Spain and close to technology parks.

Nokia promotes “Day Dreams” with their partners, where they discuss about the technology and products trends and forecast.

about the technology and products trends and forecast. “ Syngenta keeps a full time partnership manager

about the technology and products trends and forecast. “ Syngenta keeps a full time partnership manager
about the technology and products trends and forecast. “ Syngenta keeps a full time partnership manager

Syngenta keeps a full time partnership manager to manage collaboration and the network relationship, stimulating new business and solving conflicts.

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Using web2.0 tools to improve open innovation in organizations

web2.0 tools to improve open innovation in organizations “ The best manner to predict the future
“ The best manner to predict the future is inventing it.

“ The best manner to predict the future is inventing it.
“ The best manner to predict the future is inventing it.

The best manner to predict the future is inventing it.

“ The best manner to predict the future is inventing it.
“ The best manner to predict the future is inventing it.
“ The best manner to predict the future is inventing it.
“ The best manner to predict the future is inventing it.

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What facilitates this NEW approach to innovation is the rise of

Web 2.0 as an open and participatory platform

What facilitates this NEW approach to innovation is the rise of Web 2.0 – as an
What facilitates this NEW approach to innovation is the rise of Web 2.0 – as an

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Procter & Gamble Tremor

Competitive Intelligence

Procter & Gamble Tremor Competitive Intelligence • Capture impressions and trends from teenagers • Establish
Procter & Gamble Tremor Competitive Intelligence • Capture impressions and trends from teenagers • Establish

Capture impressions and trends from teenagers

Establish relationships and understand specific publics

Benefits:

Improve the relationship of P&G products with strategic customers.

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Dell IdeaStorm

Ideas and Insights

Dell IdeaStorm Ideas and Insights Users can: • Submit ideas; • Comment ideas posted; • Vote
Dell IdeaStorm Ideas and Insights Users can: • Submit ideas; • Comment ideas posted; • Vote

Users can:

Submit ideas;

Comment ideas posted;

Vote on ideas

More than 12.000 ideas

84 comments and votes

347 ideas implemented

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Innocentive

R&D

Innocentive R&D Companies propose challenges to researchers and universities and give prizes up to US$1M. Benefits:
Innocentive R&D Companies propose challenges to researchers and universities and give prizes up to US$1M. Benefits:

Companies propose challenges to researchers and universities and give prizes up to US$1M.

Benefits:

Increase the network

Improve the quality and speed on development of new solutions

Reduce the R&D investments

More than 70.000 researchers

50 universities

Companies such Basf, Syngenta e DuPont participate.

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Kraft First Taste

Testing

Kraft First Taste Testing Community to discuss new products where users can: • Provide feedback to
Kraft First Taste Testing Community to discuss new products where users can: • Provide feedback to

Community to discuss new products where users can:

Provide feedback to new products

Share opinions

The most participative users have a “first taste” new products first than others

Benefit:

Kraft improves products by using costumers experiences.

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Yet2.com

Commercialization and Scaling up

Yet2.com Commercialization and Scaling up Companies buy and sell licenses for the usage of technologies and
Yet2.com Commercialization and Scaling up Companies buy and sell licenses for the usage of technologies and

Companies buy and sell licenses for the usage of technologies and patents.

Benefits:

Profits from non-strategic and not used technologies

Companies can innovate without internal R&D

Partnerships with DuPont, P&G and Honeywell.

Participation of 90% of Fortune

500.

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Fiat Mio:

Open source design

Fiat Mio: Open source design Any company can use the ideas (more than 10.000) submitted by

Any company can use the ideas (more than 10.000) submitted by users

Fiat Mio: Open source design Any company can use the ideas (more than 10.000) submitted by

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Peugeot Design Contest

Open Design

Peugeot Design Contest Open Design • More than 4 million page views • 5 demonstration models
Peugeot Design Contest Open Design • More than 4 million page views • 5 demonstration models

More than 4 million page views

5 demonstration models exhibited at

automotive

marketing events

Designers of around 100 nationalities

10.000 prizes

5th year of the contest

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Threadless

Co-creation made by users

Threadless Co-creation made by users 30
Threadless Co-creation made by users 30

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Lego

Open source community

Lego Open source community Accelerating product innovation and turning Lego MindStorms into a highly profitable product

Accelerating product innovation and turning Lego MindStorms into a highly profitable product for Lego

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source community Accelerating product innovation and turning Lego MindStorms into a highly profitable product for Lego

Global trends in

OPEN INNOVATION

Jose Cláudio Terra

jcterra@terraforum.com.br

www.slideshare.net/jcterra

Global trends in OPEN INNOVATION Jose Cláudio Terra jcterra@terraforum.com.br www.slideshare.net/jcterra 32
Global trends in OPEN INNOVATION Jose Cláudio Terra jcterra@terraforum.com.br www.slideshare.net/jcterra 32

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