Open Innovation Community

Case #8 – NEC in Princeton

Oliver Alexy — Wed, 22 Feb 2012 20:17:09 +0000

It has been a considerable while since my last posting—I have been teaching quite a lot over the past few months, so I have had a chance to reacquaint myself with some brilliant case studies. The one I would like to talk about today is “NEC: A New R&D Site in Princeton” (HBS Case 9-898-027). Until a short time ago, I would have only looked at this case as one to teach the organization of R&D to students, and in particular the internationalization of R&D. Of course, the case is also a brilliant example of how changes in a company’s innovation strategy need to be concomitantly reflected in its organization of R&D. However, what struck me this time is how much the case actually resonates with the open innovation perspective.

The case sets out to describe NEC’s evolving innovation strategy, beginning with its foundation around 1900 to a fundamental change in its vision in the 1950s and a shift in its enactment that begins to become more prominent around 1980 (note that the case itself takes place in 1992 – this is a true classic!). We learn how NEC decides to create a lab for basic research outside its native Japan to be able to access locally generated knowledge – instructors familiar with the topic will immediately think of Bartlett and Ghoshal’s work, and, of course, Kuemmerle (who is in fact the lead author of the case!). These authors have created essential works on internationalization strategies for R&D, which can be perfectly elaborated using this case. In addition, the bridge to the concept of open innovation is easy to make, since a large bit of the case is describing how NEC tries to facilitate arrangements to be able to access knowledge from beyond the boundary of the firm. In particular, authors interested in introducing this angle to the case can easily have students explore how engagement in open innovation might come in handy for companies shifting their innovation strategies.

I have found this case to work extremely nicely in classes on innovation management in connection with other cases that play the open innovation angle more strongly. In that situation, I would use the NEC case to generally speak about how R&D needs to be organized so that innovation strategy can be appropriately executed. Doing so would allow me to introduce topics such as clusters and external sources of knowledge, and the importance of being able to access them for innovative success. In a subsequent session, I would then be further elaborating on these topics, looking specifically at companies’ larger strategic efforts to make use of their environments using multiple practices strategically at the same time—that is, how they engage in open innovation! Here, for example, the case on Intel Research I spoke about earlier is a very nice fit.

Regarding the teaching note for the NEC case (HBS Case 5-800-392), it provides instructors with all relevant materials to successfully conduct their class. Having said that, I have actually always deviated quite a bit from it, only picking those bits that were essential to conveying the concepts I had in mind. But that is exactly what is so nice about this case—it is very easy to take it and apply it convincingly to different topics which are touched upon in the excellent descriptions of NEC’s innovative strategy and activities.

References

Walter Kuemmerle, Kiichiro Kobayashi “NEC: A New R&D Site in Princeton” HBS Case 9-898-027, Revised April 28, 2004, http://cb.hbsp.harvard.edu/cb/web/product_detail.seam?R=898027-PDF-ENG, last accessed February 22, 2012

At the Court of King Henry

OIC Editor — Thu, 16 Feb 2012 01:33:34 +0000

The Deloittereview.com website has published an interview with Henry Chesbrough, originator of the open innovation concept, on all things open innovation and the challenges of sustaining the open business model. Chesbrough discuses the genesis of the OI concept, the importance of business models, the optimal conditions for making OI work, intellectual property and other issues.

Click here to read the full article.

OIC Editor — Thu, 16 Feb 2012 00:37:53 +0000

The Ernst & Young website has an article which presents an audit aimed at helping companies assess their readiness for open innovation and, where necessary, optimize structures and processes. The audit documents the company’s actual situation with regard to specific criteria and endeavors to determine the company’s readiness to utilize open innovation successfully and derive suggestions for action from these findings.

Click here to read the full article (PDF file).

Image via Flickr.

Aspects of Open Innovation Companies

OIC Editor — Tue, 14 Feb 2012 23:09:10 +0000

The OpenInnovation.eu website reports on a study by the Open Innovation Research Forum – part of the University of Cambridge – of almost 1200 German innovation companies. The paper tested the hypothesis that several different innovation-enabling factors would generate more revenue within companies that embrace Open Innovation than within companies that don’t.

Click here to read the full article.

Image via Flickr.

Open Innovation and Public Policy in Europe

OIC Editor — Mon, 13 Feb 2012 21:38:08 +0000

Henry Chesbrough and ESADE of Barcelona professor Wim Vanhaverbeke have released a report that sheds new light on open innovation and public policies in Europe. In the video below posted on YouTube, they discuss open innovation and public policy and fostering competitiveness in the European economy.

Open Innovation and Public Policy in Europe
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Seven Ways to Make Open Innovation Work in Europe

OIC Editor — Thu, 09 Feb 2012 20:21:30 +0000

The Science|Business website outlined a report describing how governments can can play a key role in triggering new models of collaboration. Government can be a catalyst – that’s one of many lessons that are starting to emerge around the world as open innovation is practiced. The report outlined seven lessons gleaned from practicing open innovation in Europe.

Click here to read the full article.

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New Research Shows Value of Enterprise Social Technology

OIC Editor — Thu, 09 Feb 2012 18:56:53 +0000

The MarketWatch website reports on a study by AIIM which shows that companies are realizing significant, measurable benefit from the adoption of social technologies in the areas of marketing and sales, open innovation and enterprise Q&A. The study found that open innovation delivers beneficial changes to both internal processes and external products, and is meeting the expectations of its sponsors. Open innovation helped realize major changes to the internal processes of 48 percent of responders and to the external offerings of 34 percent of responders.
Click here to read the full article.

Image via Flickr.

Five Questions with Henry Chesbrough

OIC Editor — Tue, 07 Feb 2012 23:53:39 +0000

The HMSGlobal.com website has an interview with Henry Chesbrough at the World Economic Forum. Recognized as the father of Open Innovation, Chesbrough coined the term in his 2003 book of the same name that has gone on to revolutionize how businesses approach the subject of innovation. Chesbrough discusses the next hottest area of Open Innovation, the biggest roadblocks to innovation and other topics.

Click here to read the full article.

Using Web 2.0 Technologies to Connect Innovation Partners

OIC Editor — Mon, 06 Feb 2012 20:49:53 +0000

The website AltTox.org reports that the concept of open innovation, to leverage internal and external resources for the creation of new products and technologies and then using the most appropriate business model for marketing the new innovations, had been in practical use within the R&D laboratories of many organizations before Chesbrough’s definition of the term. The emerging use of the Internet throughout the 1990′s, however, provided a platform that is now being used to exploit the full potential of open innovation.

Click here to read the full article.

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Open Innovation and the Petfood Industry

OIC Editor — Sat, 04 Feb 2012 20:28:57 +0000

The website PetfoodIndustry.com reports that open innovation makes much more sense than relying only on internal R&D for new product development because of factors like: the increasing availability and mobility of skilled workers; the growth of the venture capital market; external options for ideas sitting on the shelf; and the increasing capability of external suppliers. These four factors have resulted in a new market for knowledge. It is crucial whether a company can accept that the innovation point is the pivotal moment when talented and motivated people seek the opportunity to act on their ideas and dreams.

Click here to read the full article.

Image via Flickr.