Open Innovation
Steven Vaassen
Philips Consumer Lifestyle
April 2014
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April 2014
Consumer Lifestyle
Content
• Background: Open Innovation in theory
– What is “Open Innovation”?
– “Not Invented Here” syndrome
– “Want Find Get Manage” Framework
– Opportunity and Risk
• Open Innovation in practice
– Philips CL objectives and approach
– Community of Practice
– Open Innovation Toolbox
– SimplyInnovate portal
– Scouting partners
– Success Stories
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Consumer Lifestyle
What is “Open Innovation”?
The lab is our world
Closed
The world is our lab
Open
• Smart people work for us
• Smart people tap into the world
• Discover, develop, ship
• Profit from Research by others
• Create most ideas
• Use most ideas
• Control closed IP
• Trade IP
Market
R&D
Source: Henry Chesbrough, Open Innovation
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Consumer Lifestyle
Market
What is “Open Innovation”?
The formal discipline and practice of leveraging the
discoveries of unobvious others as input for the innovation
process through formal and informal relationships
Source: Frank Piller, Professor of Technology & Innovation Management
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“Not invented here” syndrome
• “Not invented here” is the philosophy of social, corporate,
or institutional cultures that avoid using or buying already
existing products, research, standards or knowledge
because of their external origins and costs.
• The reasons for not wanting to use the work of others are
varied, but can include fear through lack of understanding,
an unwillingness to value the work of others […]
• The opposite predisposition is sometimes called "proudly
found elsewhere"
Source: http://en.wikipedia.org/wiki/Not_invented_here
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“Want Find Get Manage” Framework
Source: Gene Slowinski, Good Practices in Open Innovation
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Opportunity and Risk
•
•
•
•
•
Disclosing your strategic needs and knowledge
Partner selection (best competence, idea, technology, IP)
Win-win deals (shared investment, shared benefit, long-term position)
Control of innovation process (time, structure, requirements, resourcing)
Intellectual Property: novelty, ownership, exploitation, enforcement
Source: Jim Euchner, The Uses and Risks of Open Innovation
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Consumer Lifestyle
Philips CL Open Innovation ambition & approach
• Philips delivers innovation that matters to you
• We do this by being Caring, Innovative & Impactful
• Open Innovation
– is not a goal in itself, it is an important enabler to accelerate innovation
– delivers business impact from finding better solutions quicker
– thrives in a culture of proudly-found-elsewhere with outward-looking mindset
– success is measured by # key product differentiators from outside (KPI)
• We aspire to have at least half of new product introductions leverage OI
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Consumer Lifestyle
Philips CL Open Innovation ambition & approach
Bottom-up: Program based on 4 pillars
Fill
pipeline with
differentiators
from Outside-In
Make it
easy to
connect &
collaborate
Drive
culture
‘proudly-foundelsewhere’
Embed
Open Innovation
in
organization
Top-down: Explicit integration in strategy and sponsorship by senior management
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Consumer Lifestyle
Community of Practice
• Small central team plus an OI Champion for each innovation team
• OI Champion drives local implementation of OI practices via coaching, making
tools available, training, reward & recognition
• Change agents, evangelists
• Monthly meetings to share cross-site, inspire and leverage knowledge
Drachten
Eindhoven
Suzhou
Shanghai
Bothell
Gaggio Montano
Klagenfurt
South China
Singapore
Bangalore
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Consumer Lifestyle
Open Innovation Toolbox
Patent
Landscapes
External
expert search
http://www.simplyinnovate.
philips.com/
Idea
Portal
Competitor
benchmarking
Internet
searches
Internal knowledge
management
Supplier
Market Scans
ConnectUs
Co-creation
platforms
Conferences
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Consumer Lifestyle
University
collaboration
Supplier
Roadshow
SimplyInnovate portal
• What: External idea submission portal that provides a channel for inventors to
collaborate with Philips (open call)
• Why: Source of outside-in innovation and reinforces brand reputation
(becoming Partner of Choice)
• How:
– Inventor submits idea through secure channel Simply Innovate
– Evaluation teams per product area (Business and IP) evaluate ideas and
engage with submitter
• Boundary conditions:
– Process protects both inventors and Philips
– Innovators should have IP in place before submitting
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Scouting partners
• Scouting: Pro-actively reaching out to identify external sources of knowledge,
technology, IP, prototypes or products (targeted search)
•
•
•
•
Want: Business and competence needs feed into the search briefing
Find: Appropriate scouting partners (int/ext) broadcast and search
Get: Legal / IP, procurement supports deal-making with short-listed company
Manage: Execute alliance (JDA, contracted, supply) to jointly reap benefits
• Our internal and external scouting channels
– Scouting agencies (NineSigma, Strategic Allies)
– Individual scouts (geographical focus Asia, USA, Israel, Europe)
– Internal network (experts, ‘connectors’, ConnectUs)
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Consumer Lifestyle
Example: Air Fryer
• Consumers are looking for solutions to prepare
the foods they love, in a healthier way
• We went looking for a compact and affordable
technology to enable people to cook food
quickly, with less oil
• We partnered with SME from whom we license
Rapid Air Technology
• We took this global innovation to market in a
highly locally relevant way
• The Philips Airfryer is now available in over 100
markets worldwide and Euromonitor has
confirmed that Philips is the world’s #1 low fat
fryer brand
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Consumer Lifestyle
Example: Open campus (2003)
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Example: Hue
• x
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Concluding remarks
• Open Innovation is not a goal in itself, yet
complements and accelerates internal innovation
power (focus on outside-in)
• Open Innovation bring opportunities but also
introduces new risks
• It requires (other) efforts to employ and continuous
attention to maintain (mindset)
• A lot can be learned from achievements of others
• Networking and entrepreneurship are crucial to
success and fun 
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