With the front pages covered everyday with news on the financial crisis, one would almost expect that Europe has come to a screeching halt. Nothing would be further from the truth with relation to open innovation. Although European companies have traditionally been a bit slower in adopting new management practices, they tend to more structurally integrate these practices in the organization when they are adopted. Our observation is that more companies are implementing open innovation practices. There is an increase in roundtable discussions and industry specific networks such as the Food and Drink Innovation Network, where companies are sharing their learnings in practicing open innovation.

Accenture and the Institute for Innovation and Competitiveness i7 created by ESCP Europe studied 20 large international companies that are actively leveraging open innovation and asked the question of whether open innovation is really a new business concept or is a practice that simply has a new label. The study, published this week, uncovered some interesting takeaways:

• Open innovation as practiced now involves a structured and systematic approach for bringing outside inside. There is now a more manageable end to end process.
• There has been a fast pace of adoption: only 10 years from first movers to wide adoption, the early majority came into play in 2010.
• There has been a significant increase in external resources available, which can potentially create huge operational challenges.
• Positioning the open innovation strategy on the right openness scale: combining topic-driven approaches with partner-oriented open innovation
• Defining the right balance between depth and breadth of relationships with partners: the most advanced companies are widening the scope and variety of partners.
• Excelling at the partner management process: creating a real win – win; advanced companies have structured and standardized these processes.
• There is no open innovation “free lunch”: all companies involved have invested in capabilities like organization, skills, tools and governance to make open innovation happen (60% of the companies have invested with NineSigma)
• It is not only about appointing a “Chief Open Innovation Officer”: changing the culture and developing absorptive capacity and making open innovation a natural part and recurring way of practicing innovation.
• Open innovation works: the study shows that open innovation reduces time to market even though it gets more complex with external partners. It also improves intellectual property protection, helps promote the sustainability agenda and enhances the company’s innovativeness.

The full report can be downloaded here.  

With our growing client base in Europe, we have added new team members to our group including Marcel Zillig supporting our clients in Germany, Austria and Switzerland; George Vincent as head of our activities in the UK; Pantea Lotfian has responsibility for our intelligence and landscape projects; and Campbell Lockhart supports clients on implementing open innovation inside their organization.

I look forward to connecting with you. Let me know your thoughts on how open innovation is advancing in the European market.