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Factors that make open innovation more successful than traditional approaches

Jacob Dencik (Global Economic Research Leader of IBM Institute for Business Value (IBM IBV) in Brussels, Belgium (jacob.dencik@be.ibm.com))
Lisa-Giane Fisher (Global Benchmark Research Leader at IBM IBV in Johannesburg, South Africa (LFISHER@za.ibm.com))
Lisa Higgins (President and CEO of the American Productivity & Quality Center in Houston, USA (lhiggins@apqc.org))
Anthony Lipp (Global Head of Strategy for Banking and Financial Markets at New York, USA)
Anthony Marshall (Senior Research Director of thought leadership of IBM IBV at New York, USA (anthony2@us.ibm.com))
Kirsten Palmer (Global Performance Data and Benchmarking Director IBM IBV at Atlanta, USA (kirsten.crysel@us.ibm.com))

Strategy & Leadership

ISSN: 1087-8572

Article publication date: 4 July 2023

Issue publication date: 21 August 2023

610

Abstract

Purpose

Four management capabilities for successfully operationalizing open innovation are: strategy and culture, ecosystem capability, internal capability and technology enablement. Surveying more than 1,000 executives on current open innovation practices and capabilities, IBM IBV was able to identify how the different operating model capabilities interact and complement each other to drive better innovation and business performance.

Design/methodology/approach

To help organizations build and improve their open innovation capabilities, the IBM Institute for Business Value (IBV) partnered with APQC to develop the Ecosystem-Enabled Innovation Maturity Model (EEIMM) - an open standards model encompassing four domain competencies required for successful open innovation. To assess the maturity and benchmark the performance of organizations’ open innovation capabilities, the IBV, in collaboration with Oxford Economics, used the EEIMM to survey over 1000 leaders responsible for open innovation at their organizations.

Findings

Four management capabilities for successfully operationalizing open innovation are: strategy and culture, ecosystem capability, internal capability and technology enablement. IBV analysis found that organizations that are more advanced in developing the four building blocks see significantly better performance across key financial and innovation metrics.

Practical implications

For every dollar of investment, the proportion of direct revenue attributed to open innovation is four times higher than for traditional innovation.

Originality/value

Leading organizations are embracing open innovation as a critical component of innovation strategy and investment. They recognize that adopting open innovation yields far greater returns than traditional innovation can. Recent research by the IBM Institute for Business Value (IBM IBV) reveals, for example, that as many as 84 percent of executives now view open innovation as important for their organization’s future growth.

Keywords

Citation

Dencik, J., Fisher, L.-G., Higgins, L., Lipp, A., Marshall, A. and Palmer, K. (2023), "Factors that make open innovation more successful than traditional approaches", Strategy & Leadership, Vol. 51 No. 5, pp. 22-29. https://doi.org/10.1108/SL-05-2023-0057

Publisher

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Emerald Publishing Limited

Copyright © 2023, Emerald Publishing Limited

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