Know About Type Of Open Innovation




January 5, 2022

The technique of corporations and organizations sourcing ideas from external and internal sources is known as open innovation. This entails sharing problem-solving knowledge and information and seeking solutions and suggestions from people outside the company. Open innovation is a more decentralized, distributed, and participative invention method. This method is an excellent way to gain access to outside knowledge and discover new routes. To have a clear understanding of this concept, you need to know about the type of open innovation.

Details about Type of Open Innovation

Companies can apply different types of open innovation in various ways, putting the principle into practice in whatever way best matches their company goals. You can create a clear grasp of leveraging open innovation as you study the many types.

Open innovation can be classified into four levels of inclusion:

  • Intracompany

Intracompany innovation pulls together resources from several departments. In this kind of innovation, the particulars and statistics are shared internally among the employees.

  • Intercompany Innovation

Open innovation between two (or more) companies is known as intercompany innovation. A corporate accelerator is an excellent example of this type.

  • For experts

This type of open innovation involves bringing in people from outside the company who have the necessary experience and knowledge to provide valuable advice.

  • Publicly Open

Open innovation invites everyone from outside the organization, regardless of their prior knowledge or reputation.

Importance of Open Innovation

  • Maintaining relevancy and surviving in the market are the primary motivating factors of innovation.
  • As the world changes, new domains have the potential to generate financial benefits for a company. It is a necessary component of surviving longer and outlasting the competition. As a result, it assists businesses in keeping competitors at bay while also better meeting the demands of their clients.
  • Innovation can be as significant as introducing new technology or as tiny as improving a product feature. It uses the power of people, both internally (workers) and outside (customers), to stay relevant and meet market demands.
  • As a result, new products and services can be introduced, and market problems and competition can be reduced.

Open Innovation: Necessary Requirements

Some conditions must be met to make the various types of open innovation successful.

  • In order to develop innovations with partners and networks, organizational competency is required.
  • Internal and external networks are both important.
  • Process of innovation with external interfaces.
  • Communication and collaboration tools for partners (e.g. IT tools).
  • In order to secure competencies and insights from the outside, knowledge management is used.


The main downside of open innovation is its unpredictable nature. While open innovation has the potential to produce something unexpected and wonderful, it also has the potential to fail miserably.

However, as open innovation aims to collect a large number of fresh ideas rather than exert too much control over the outcome, we did like to highlight some of the most typical problems and challenges that businesses experience when implementing open innovation.

These issues are classified into four categories: strategic, operational, legal, and cultural.

The following are the most typical factors that hinder every type of open innovation:

Aspects of strategy

  • Uncertain objectives
  • Inconsistent strategic alignment
  • The wrong kind of audience
  • Opportunity cost - diminishing returns

Structure and operation

  • Processes that are lacking
  • Ideas that have not been created or executed
  • Types of tools that aren't appropriate

Legal considerations

  • Rights to intellectual property
  • Cultural considerations
  • Negative perceptions of open innovation

If you want to learn innovation, you can check out the courses in innovation offered by MIT ID Innovation. Our institute can help you to have a deep understanding of innovation and how you can use it to grow your business, its importance and drawbacks, and most importantly, its implementation. It is one of the best institutes in India located at Pune that offers online courses too.

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