Cesar Castro Open Innovation Presentation

Open Innovation and the Future of
Organizations
Cesar Castro

cesar@discoverycast.com

Founder and CEO

DiscoveryCast, Inc.
© Copyright 2010 DiscoveryCast, Inc. all rights reserved

1 ‐ Open Innova,on 
Strategies  Topics
Topics

2 ‐ Preparing for The 
8 ‐ Brainstorming /  New Innova,on 
Idea,on  Paradigm 

3 ‐ Innova,on in an 
6 ‐ Examples / Case  Increasingly 
Studies  Collabora,ve 
Environment 

5 ‐ GeIng Started: 
4 ‐ Managing 
Developing An 
Conﬁden,ality / IP 
Innova,on Strategy 

© Copyright 2010 DiscoveryCast, Inc. all rights reserved   2

My Background

 1980’s 
 1990’s 
 2000’s 

 Today  © Copyright 2010 DiscoveryCast, Inc. all rights reserved

Innovation is…….

(to be filled in later)


Open Innovation is……

(to be filled in later)


What Has Changed In The Innovation Landscape?

IBM CEO Survey - March 2006


Innovation Is Everywhere

Seeing the unseen or,  Op,mizing the value crea,on 
 “…the eureka moment…”  opportunity 

Scien,ﬁc Discovery  Technological Innova,on 

New Market Insight  Market / Retail Innova,on 

New Produc,on / Process Insight  Supply Chain Innova,on 

New Business / Financial Insight  Business Model Innova,on 

New HR Policies  Human Capital Management 
Innova,on 

New Social / Ecological Insight  Social Innova,on 

Regulatory / Legisla,ve Change  Business / Marke,ng Innova,on 

What is Open Innovation?

(traditional definition)

Closed
Innovation
Model Market
Revenue

Open Market
Innovation Revenue
Model plus
New
Revenue


New Explanation of Open Innovation

suppliers 
re6rees 
Large firms/
social networks
individual firm
 Academia/ 
     SME’s 
innova6on 
group  Individuals/ 
consultants 
customers 
compe6tors 

INTERNAL INNOVATION


New Explanation of Open Innovation

Open Innova*on 
Begins  Internally, Then Goes External 
suppliers 
re6rees 
Large firms/
social networks
individual firm
 Academia/ 
     SME’s 
innova6on 
group  Individuals/ 
consultants 
customers 
compe6tors 

INTERNAL INNOVATION AND EXTERNAL INNOVATION


Why Is Open Innovation Important?

    Companies have….. 

    lowered their cost of innovaAon 

    brought new ideas to old problems 

    generated new revenue streams 

    accelerated the rate of innovaAon 


Open Innovation Strategies


Open Innovation Requires A Portfolio Approach

Internal External

Indirect Direct

Social

Characteristics of An Open Innovation Approach
Rapid Prototyping of
Ideas

Distributed Diversity

Shared Anyone Can
Financial Contribute
Risk

Share and Co-
create IP

How To Prepare For The New Innovation Paradigm


Principles Of The New Innovation Model
Develop More Transparency

Engage with networks

Embrace community

Competitors can be collaborators

Discourage the “Not Invented Here” syndrome

Engage with failure

Maintain a “memory” bank of successes/failures

FailCon


Key Skills For Individuals

Learn to frame the question properly

Think of yourself as a solution finder

Learn to collaborate and share

Stay informed with filtered information  


Key Skills For Companies

Prioritize and incentivize innovation

Move to a higher risk profile

Adapt the company structure

Reinvent company culture

Promote experimentation and weather
change 

25

Innovation in an Increasingly Collaborative
Environment


Engagement in social networks

The
Engagement
Ladder

Source: Forrester Research


Managing Confidentiality / Intellectual
Property


Confidentiality/Intellectual Property

RULE #1 

Not every challenge / technology need is 
suitable for external innovaAon 


Confidentiality/Intellectual Property

    Look for opportuniAes to share non‐confidenAal 
      informaAon first 

    Framing the quesAon can also help manage 
      confidenAality 

    Risk‐taking needs to be higher  

    80 /20 rule (80% of of corporate IP is not uAlized) 

   IP ownership is shiWing; small businesses are accounAng 
     for more and more of the innovaAon pie (patents, 
     technology, etc) 

Getting Started


Getting Started

The innovation dial

32

4 Strategies to Leverage External Networks
Creative Bazaar Jam Session
emergent
INNOVATION TYPE

Orchestra MOD Station
defined

central diffuse

NETWORK LEADER
Source: The Global Brain, 2008

✖ 
Kraft Innovation Portal

Conclusion


Innovation is…….

A process by which new ideas fuel
developments in products or services that
capture value in the marketplace.


Open Innovation is…….

A mindset, not a type or category of
innovation

A means of production for innovation


Key Takeaways

    Open InnovaAon is all about culture change 

    PorZolio approach is important 

    Social networks are part of innovaAon 

    Framing the quesAon is a criAcal skill 

    ConﬁdenAality  / Intellectual Property CAN be managed 

    Diversity of the network is important 


Bibliography

The Open Innova6on Revolu6on, Stefan Lindegaard, Wiley , 
2010.  
The Global Brain, SaAsh Nambisan and Mohanbir Sawhney, 
Wharton School Publishing, 2008. 
Open Business Models, Henry Chesbrough, Harvard Bus. School 
Press, 2006. 
Crowdsourcing, Jeﬀ Howe, Random House, 2008. 
Open Innova6on: The New Impera6ve for Crea6ng and Proﬁ6ng 
from Technology, Henry Chesbrough, HBS Press, 2003. 


Cesar Castro Open Innovation Presentation

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