Open innovation is a business management model for innovation that promotes collaboration with people and organizations outside a company. Encouraging such practices across European firms can be a driver for innovation and competitiveness.
Open Innovation can accelerate organizational learning and innovation.
For years, the stock price of Tesla has been soaring. Although they compete with powerful incumbents, they seem to have gained investor’s trust and regularly introduce innovations that push the entire industry forward. How do they scale and grow so fast? Part of the answer roots back to the year 2014 when Tesla decided to open-source its patents and encourage other companies to use its intellectual property.
In hindsight, that strategic move shows that Tesla’s management team was aware of the power of an open and holistic perspective. The car manufacturer recognized the need for an enabling environment to scale their electric cars, something they couldn’t do alone. They needed partners that would build charging stations and offer services to create the infrastructure to support electric vehicles. By putting itself at the center of an ecosystem of partners and by actively seeking collaborators, Tesla laid the groundwork for its explosive growth.
Even though engaging with their surroundings is not particularly novel for organizations, most activities outside a firm’s boundaries happen in a sporadic and unstructured manner.
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The study was written by Oliver Behr, Young Professional Advisor at United Europe, Open Innovation Researcher, Venture Builder and Sustainable Business Consultant.