Open Innovation is the idea that a company can create value (product and services) not only by its internal workforce but as well through collaborations, licensing & spin-off. The concept of Open Innovation is now well known as it emerged in the United States about fifteen years ago.
In the United States, where Open Innovation is now well accepted, it has been observed that companies practicing Open Innovation tend to be more efficient in terms of innovation (shorter cycles with lower costs) than those who did not use this concept.
The government and large company top management are trying, somehow, to “impose” Open Innovation into French habits.
How public authorities could be adapted to support Open Innovation? We examine in this article that certain adjustments could be made. Is Open Innovation the best approach? In any case, is it a suitable approach for France?
Open Innovation in 2 words
In the paradigm of Open Innovation, a company has adapted its whole innovation strategy and management (as defined in the Oslo Manual) to maximize the benefit of its surrounding microcosm. This includes maximizing the use of solutions developed externally (outside-in) and monetizing technologies developed internally that cannot find applications for the core business (inside-out).
Open Innovation and open source are different
The term “open innovation” is not knowledge or technology free. If the term “open source” means technology available royalty-free, open innovation refers to methods of collaboration used and it can even involve the payment of license fees (significant) between companies, to obtain intellectual property.
Does Open Innovation mean less R&D ?
Open Innovation is an extension of internal R&D, not a substitute. External collaborations on technological aspects is complementary to internal R&D investments. Some fear that Open Innovation means
- Less R&D for companies,
- Less investment from the state in public research.
This is Wrong. In order to digest results of collaborations with public research and make these collaborations have real impact (see our article “best practices in terms of academia-industry collaboration), companies must maintain a strong internal R&D activity.
Furthermore, a series of studies conducted in several countries (see study by the OECD in the reference list), shows that companies engaged in an Open Innovation policy are more innovative than those who do not.
Open Innovation enables companies to access a range of knowledge and ideas well beyond what can be generated internally, which increases serendipity and thus accelerate innovation while reducing its cost.
It is also interesting to note that Open Innovation is not restricted to large industrial groups: the same studies have revealed that Open Innovation is also used by SMEs in some Nordic countries. The implementation of the Open Innovation should be really suited to each country according to its habits.
Public Policies for Open Innovation
Open Innovation is relatively new in the landscape of French research and innovation. However, a significant number of tools have already been implemented by the French government to allow greater knowledge and technology transfers from public research to the private sector. Here are some examples:
- CIFRE PhD thesis: subsidy for any company that hires a French doctoral student for a research collaboration with a state laboratory.
- The Agence Nationale de la Recherche: the ANR deals with public research institutions and companies with a dual mission: produce new knowledge and promote interaction between public laboratories and corporate laboratories by developing partnerships.
- The Crédit d’Impôt Recherche (Tax credit on Research): The CIR allows to partially fund research activities undertaken by companies. It allows, among other things, a grant award for companies outsourcing part of its R & D to a public research laboratory.
- Clusters : “Poles de compétitivité” are the emblematic solution that France has put in place to foster collaborations between public research and industry by bringing together in one geographic location companies and research centers.
- “Cellules de valorisation” : these Technology Transfer Offices help promoting technology outside labs and universities as well as create startups.
Startups: Driving Open Innovation
Startups are a key element in the landscape of Open Innovation. This was clearly explained by Chesbrough in his book Open Innovation, for the United States, where the ecosystem is extremely favorable to the creation of startup, which is not as clear for Europe and France.
A startup is a young company that develops and commercializes innovative technology. The initial technology may be the result of public or private research. Nevertheless, the project is usually carried by a group of highly motivated people, making startup very dynamic and responsive. They are a very important vehicle for transferring knowledge and technology.
References and links
- This article is partly inspired by an article published by Frédérique Sachwald, head of R&D within the French ministry of higher education and research in QIS, the magazine member EIRMA.
- Study conducted by the OECD (Open Innovation in global networks).
- Global networks Open Innovation systems and national public policy report by the Ministry of Research and Higher Education, by Frederique Sachwald.
- Open Innovation: Where Do French Companies Stand ?, by Thierry Weil.
- Open Innovation, Henry W Chesbrough; book on Open Innovation. See especially Chapter 2 on the closed innovation and erosion.
- The illustration of the article “Open Partnership” is licensed under Creative Commons and is available here.
- We have also published the present article in French on our other blog.