Organizing for Open
Innovation
Professor Charles Snow,
Penn State University &
Fulbright-Hall Chair in Entrepreneurship
National University of Ireland, Galway
May 4, 2012
When The Innovation Process
Is “Closed”
Hold Creativity/Innovation Workshops
Organize Innovation Tournaments
Expand and/or Focus R&D
Create Internal Venture Capital Committees
Appoint and Empower Business Development
Teams
Acquire Other Firms
If You Have a Problem, Ask Everyone!
-- Title of a New York Times article (Dean, 2008)
InnoCentive
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Spun out of Eli Lilly in 2001
First online marketplace for corporate R&D
Seekers, Challenges, and Solvers
Process: Seekers formulate and post challenges. Registered
solvers work on the challenges. Winning solvers get
predetermined financial awards ($5,000 to $1 mil.)
InnoCentive has various programs that can be used for
innovation, and it has mechanisms for protecting intellectual
property rights.
P&G’s Connect and Develop
Program
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From R&D to C&D (from closed to open)
7,500 internal R&D staff could be “connected” with 1.5 million
people of similar or greater talent
Goal of 50% of innovations coming from outside the company
Technology briefs are provided to networks of: government and
private labs, academic and other research institutions, suppliers,
retailers, competitors, development and trade partners, VC firms,
and individual entrepreneurs
70 P&G “technology entrepreneurs” who work out of six C&D hubs
in China, India, Japan, Western Europe, Latin America, and the U.S.
User-Driven Innovation
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Identify “lead users” (customers who are at the front of
market trends and who expect benefits from new
products)
Use lead users to help develop new products and as
beta sites
Establish programs that enable lead users to become
entrepreneurs (e.g., LEGO’s Ambassador Program,
LEGO Architecture, LEGO Factory)
OpWin Global Network: Organized for
Continuous Innovation
Three founding firms
l  Principal Office
l  Innovation Catalogue (Idea Bank)
l  60 member firms collaborate with whomever
they want
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Blade.org: A Collaborative
Community of Firms
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Launched by IBM and seven other Founding Firms in
2006
Capitalized on IBM’s reputation forged in the open
source software ‘movement’
Grew to more than 200 member firms (mostly U.S. firms
but some international)
Blade.org has a significant share of the blade server
market
Blade.org ceased operations in June 2011
Blade.org: Purpose and
Strategy
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Purpose is to find applications for IBM’s bladecenter
technology (a computer server technology)
Strategy is to invent new solutions via collaborative
innovation projects and networks
Member firms are free to self-organize
Website, IdeaBank, and nine technical committees
constitute the “commons”
Principal Office serves as the Shared Services Provider
Collaborative Processes at
Blade.org
Within 18 months, Blade.org firms developed more than
60 solutions through:
l  Bilateral Collaboration (with customers)
l  Direct Collaboration (among two or more Blade.org
member firms)
l  Pooled Collaboration (IdeaBank)
l  External Collaboration (with outside firms)
Actor-Oriented Architectural
Scheme
Actors who have the values and capabilities to
self-organize
Commons where resources are accumulated
and shared
Protocols, Processes, and Infrastructures that
enable the actors to connect and collaborate