Open Innovation and Open Business Model


“Open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology”. Open innovation is a term promoted by Henry Chesbrough, a professor and executive director of the Center for Open Innovation at UC Berkeley. There is no almost no boundaries between the company and its environment, so the innovations can easily transfer inward and outward.

And Open Business Models in “How to Thrive in the New Innovative Landscape”, Henry Chesbrough defines open innovation as the flow of knowledge internally and externally such that it moves the process of innovation at a much faster pace and so that new markets can be found for the use of this innovation.

There is some company that doing open innovation and open business model, for example Procter and Gamble and Peugeot. Procter and Gamble in 2001 got a dramatic transformation then they adopted open innovation into their company and they called it The Programme Connect and Develop or C+D. Its goal is to find new products, technology, planning, the business model, etc. P&G looks to find partners to license and develop them while the C+D program primarily concerned to bring the new open innovation business model about inbound and outbound idea.

This is just a simple though from a simple person like me. Sometimes I think that a business competition is one of the way to search innovation from outside. For example Loreal has Loreal Brandstorm and P&G has P&G ASEAN Business Challenge. Yeah, there is only a business plan competition to develop one of their brand. I have been through P&G ASEAN Business Challenge, and I think they indirectly search some innovation or any revamping strategy using the challenger mind. Well, the that is not the objective of the competition, but indirectly it is can be one of the way. In Loreal Brandstorm, we have to develop a brand by launching another product, automatically the company collect so many idea prom the participation.

P&G ASEAN Business Challenge 2010

Loreal Brandstorm 2010


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