Open Innovation – What It Is and How to Do It

Open innovation is a mindset of being open to sharing and receiving information beyond the preset confines of a company, involving collaboration and creative input from external parties. This article explores the concept by discussing its types, benefits, and challenges. Closed innovation is the conventional method of doing innovation, relying solely on employees' expertise and internal processes. Open innovation, on the other hand, believes in external parties' knowledge and creativity for achieving strategic goals. The article categorizes open innovation types by inclusion and purpose of use and provides examples of successful and unsuccessful open innovation challenges by Philips, Netflix, Mountain Dew, and Henkel. The discussion ends with the benefits of open innovation, including increased innovation diversity, speed, and reduced costs.