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12 November 2020

Open Innovation is encouraging collaborative ways of creating new solutions

Open Innovation is encouraging collaborative ways of creating new solutions
The next article in our series about connecting smart ideas focuses on Open Innovation. By combining skills and expertise, players from across industries are taking a fresh approach to developing solutions with the power to make the world better.
The term ‘Open Innovation’ was first used in 2003 by Henry Chesbrough, an organisational theorist from the US. It describes innovation processes that systematically involve customers, suppliers and external research teams from the start instead of developing new products behind closed doors. By drawing on ideas and skills from outside of their own organisation, companies aim to gain a more comprehensive understanding of the challenge they are tackling – and improve their final results. Open Innovation was first popularised in the software industry, where it’s often referred to as ‘open source’. However, it has since gained acceptance across industries and around the world because it can boost creativity and accelerate development times. In turn, this supports companies in responding to the rising complexity and pace of market change that is being driven by globalisation and the digital revolution.

Pharmaceutical companies, for example, often face challenges related to making sure their R&D projects are always in line with the latest scientific findings – because these findings are changing faster than ever. As a result, Open Innovation is becoming increasingly common in this industry. Many companies are exploring ‘outside-in’ approaches that integrate external knowledge to promote creative thinking. Similarly, ‘inside-out’ approaches, in which a company shares its own knowledge with other organisations, are also gaining popularity. This short video provides further explanations of how Open Innovation works in practice:

The world of scientific research celebrated one of the most high-profile successes of Open Innovation in 2003, when the Human Genome Project published its ground-breaking results. By sharing knowledge, insights and creativity, this international team was able to achieve a feat that would’ve been impossible for any single organisation working alone. In this spirit, many pharmaceutical companies are setting up collaborative research centres that open up their R&D activities to external participants. Grünenthal recently established an Innovation Hub in Boston with the aim of exploring opportunities for collaborative innovation in pain therapy. By sharing its expertise and working with institutions ranging from universities and start-ups through to entrepreneurial science companies, it is striving to address unmet medical needs for patients and move closer to its vision of a world free of pain.

“Open innovation is a paradigm that assumes that firms can and should use external ideas to advance their technology”

Henry Chesbrough,

organisational theorist

Connecting smart ideas
In today’s fast-paced world, it’s more important than ever to share information between companies, academic institutions and other organisations. By exploring new forms of collaboration, players from across industries and around the globe can generate innovative solutions that make the world a better place. This series of articles aims to highlight how connecting smart ideas can stimulate creativity, achieve ambitious goals – and transform our lives forever.
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