Why is Open Innovation So Important? (Video)

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You might have heard a lot of talk about open innovation in recent years. But what do we mean by that? And why is open innovation so important for businesses?

What is open innovation?

Open innovation is where organizations seek input from external sources, such as clients, partner organizations, and academic institutions. For example, our customer – Dutch mental health provider, Kwintes – uses innovation managment software to get ideas on how to improve their services directly from their patients. (You can find out more about the benefits of idea management for healthcare providers on our innovation for healthcare page.)

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Why use open innovation?

Here’s why this method of crowdsourcing ideas is so important for organizations:

Stay ahead of the competition

Open innovation enables you to source lots of ideas, very quickly, from people who already have a connection to your business or industry. They can give you a fresh perspective on challenges that your organization is facing – this can give your business the information it needs to adapt to meet the needs of a rapidly changing world.

Open innovation also helps you obtain the benefits of intrapreneurship. By opening up the floor for innovative thinking and collective ideation, you are recognizing just how incredibly beneficial it can be to have intrapreneurs in your team.

Recommended reading: What is a business case?

Seek diverse views

Seeking ideas from external organizations gives you access to a greater diversity of opinion and experience, without having to hire extra talent or use paid sources such as focus groups. This is particularly useful for smaller companies and those operating on a budget.

Having a wider range of viewpoints will provide you with a more holistic view of solutions to your business problems.

Get direct feedback from customers and partners

Asking your clients and partner organizations to have their say on new ideas for the business will instantly create a link with them and make them feel that your business cares about them. It also provides a tailored and personalized aspect to your company’s services or products that inspire loyalty in clients.

This also enables you to get immediate feedback on new products or ideas, so you know which are the most likely to resonate with your audience.

Share knowledge

Open innovation can be a great way to pool your knowledge with other organizations, such as research institutes, partners, and people in the same industry.

For example, some construction companies are looking to use open innovation to share knowledge on changes to environmental legislation and improve their sustainability. This will enable them all to learn from each other’s mistakes and individual areas of expertise.

It is also popular with universities, which can use open innovation to enhance their research and learn from other institutes that have expertise on similar topics.

Recommended reading: Ultimate guide to innovation management

Spread the word

Open innovation can be a great PR opportunity too – especially if you choose to run a competition or an event such as a hackathon. But what is a hackathon? It’s an event that brings people together to innovate with full-fledged creativity and speed.

Hackathons come in many different shapes and sizes. If you’d like to consider setting one up, take a look at the types of hackathons available.

People connect with companies that have a purpose and they want to have an impact on the world. By reaching out and asking people to innovate on something they care about, they will spread the word about your challenge – and your company.

Join the world’s most innovative brands using our end-to-end innovation management tools.

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Why is open innovation so important?

Open innovation – the practice of sourcing ideas and suggestions from external sources – is important as it helps organizations to:

  • Stay ahead of the competition
  • Improve diversity of views and experience
  • Gain direct feedback from customers and partners
  • Share knowledge
  • Spread the word about their business.

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