MOOI Theme 2:

Top management in
open innovation

Prof. Henry Chesbrough, University of California, Berkeley & ESADE

Prof. Wim Vanhaverbeke,Hasselt University, ESADE & National University of Singapore

Dr. Nadine Roijakkers, Hasselt University

January 7, 2013

Top Management in Open Innovation:
Overview Innovation: Overview

Findings

Support from top management is important

Needs the right skills

OI managed top-down or bottom-up?

Implications

Top management has to be committed

Top management has to empower the OI Team

Create OI strategy aligned with corporate strategy

Have a CEO mandate

FINDINGS

Top Management in Open Innovation:
Overview Innovation: Overview

Findings

Support from top management is important

Needs the right skills

OI managed from the Top or Bottom up?

Implications

Top management has to be committed

Top management has to empower the OI Team

Create OI strategy aligned with corporate strategy

Have a CEO mandate

Top Management Finding 1:
Support from top management is important ovation: Overview

Findings

Senior management support of an OI initiative is crucial to allocate resources and ensure there is both motivation and a mandate for culture change [Rutledge H., 2012]The support of top management is absolutely essential and we have it on a daily basis
[Thoen, 2011]

Senior leaders must understand and apply open innovation [Slowinski &Sagal, 2010]

Executive-level leadership is required, as is constant focus to reinforcing the message, and a clear understanding of the stakes [Bingham &Spradlin, 2011]

Top management support is instrumental in achieving OI rollout across the whole organisation [Mortara et al., 2009]

Executive sponsorship needed (remove roadblocks and mandate participation) [Sloane, 2012]

Link with Culture

Top Management in Open Innovation Innovation: Overview

Findings

Support from top management is important

Needs the right skills

OI managed top-down or bottom-up?

Implications

Top management has to be committed

Top management has to empower the OI Team

Create OI strategy aligned with corporate strategy

Have a CEO mandate

Top Management Finding 2:
Needs the right skills ovation: Overview

Findings

Senior leaders must develop and support the necessary skills [Slowinski & Sagal, 2010]

Link with skills development

Source:Slowinski and Sagal (2010): Senior Management Roles in Open Innovation

Top Management in Open Innovation Innovation: Overview

Findings

Support from top management is important

Needs the right skills

OI managed top-down or bottom-up?

Implications

Top management has to be committed

Top management has to empower the OI Team

Create OI strategy aligned with corporate strategy

Have a CEO mandate

Top Management Finding 3:
OI managed top-down or bottom-up
vation: Overview

Findings (1/5)

Real change is possible when managed from the top [Bingham & Spradlin, 2011]

Only CEO and board of director can drive the change needed to become a Challenge Driven Enterprise [Bingham & Spradlin, 2011]

Occasionally, senior management sees the need for OI, but mostly it is launched at the department level [Sloane, 2012]

Sources:Bingham A - Spradlin D.(2011): The Open Innovation Marketplace

Sloane P, (2012): A guild to open innovation and crowd sourcing

Top Management Finding 3:
OI managed top-down or bottom-up
vation: Overview

Findings (2/5)

TBX (O) approach [Lindegaard, 2011]

Top down: get executives on board and require personal commitment

Bottom up: Value creation begins with people. Involve and engage employees

X: across: middle management has focus on their own profit-and-loss responsibility

Outsiders: external partners will bring knowledge, skills, experience,..

4 Ways to Open innovation [Mortara et al., 2009]

Top-down, strategically-driven, centralised activities (mature)

Top-down, strategically-driven, distributed activities

Bottom-up, evolutionary, distributed activities (mature)

Bottom up, evolutionary, centralised activities

Sources:Bingham A - Spradlin D.(2011): The Open Innovation Marketplace

Sloane P, (2012): A guild to open innovation and crowd sourcing

Top Management Finding 3:
OI managed top-down or bottom-up
vation: Overview

Findings (3/5)

TBX (O) approach [Lindegaard, 2011]: You need to work with 3 + 1 organizational approaches.Top down:

Get executives on board and make them personally commited to the innovation activities. Without executive support, no change occurs

Bottom up: Value creation begins with people, one by one, team by team. Nothing happens unless you get employees engaged and involved.

X: across:The biggest challenges will come from middle management placed across e organiation due to a narrow focus their own profit-and-loss responsibility

Outsiders: External partners will bring knowledge, skills, experience, Include external resources as you move towards OI

Sources:http://www.slideshare.net/StefanLindegaard/open-innovation-summit-stefan-lindegaard-presentation-2645946

Top Management Finding 3:
OI managed top-down or bottom-up
vation: Overview

Findings (4/5)

4 Ways to Open innovation [Mortara et al., 2009]Top-down, strategically-driven, centralised activities

Top-down, strategically-driven, distributed activities

Bottom-up, evolutionary, distributed activities

Bottom up, evolutionary, centralised activities

Sources:Bingham A - Spradlin D.(2011): The Open Innovation Marketplace

Sloane P, (2012): A guild to open innovation and crowd sourcing

Interactive poll 1

What are the three most difficult roles of top management in implementing OI?

Allocate resources for OI initiatives

Ensure there are incentives for a cultural change

Continuous support from top management

Top management should understand OI

Top managements role in achieving OI rollout across the organization

Executive sponsorship (remove organizational roadblocks)

Executive support for the development of the necessary skills

Sources:Mortara, L. et al. (2009): How to implement Open Innovation

Lindegaard S. (2011): The Open Innovation Revolution

implications

Top Management in Open Innovation Innovation: Overview

Findings

Support from top management is important

Needs the right skills

OI managed top-down or bottom-up?

Implications

Top management has to be committed

Top management has to empower the OITeam

Create OI strategy aligned with corporate strategy

Have a CEO mandate

Top Management Implication 1:
Commitment
vation: Overview

CEO must be deeply committed [Lindegaard, 2011]

Top of organization must be committed in no uncertain terms and see it through to the end [Bingham & Spradlin, 2011]

Demonstrating commitment and support, top management holds the key to sway the opinion of those who feel less inclined to accept the new approach to innovation [Mortara et al., 2009]

Executives must not only understand but also buy into the value proposition [Sloane, 2012]

Commitment from the top down helps building the culture for OI [Sloane, 2012]

Leaders must promote innovation and an entrepreneurial culture across the organization by being personally involved in establishing and implementing clear and relevant ways to support innovation [Igartua 2010]

Sources:Mortara, L. et al. (2009): How to implement Open Innovation

The Open Innovation Marketplace (Bingham A - Spradlin D.) (2011)

Sloane, P. (2012): A guide to Open Innovation and Crowdsourcing

Lindegaard S. (2011): Making Open Innovation Work

Igartua, J. I., Garrigs, J. A., & Hervas-Oliver, J. L. (2010). How innovation management techniques support an open innovation strategy. Research Technology Management, 41-52.

Top Management in Open Innovation Innovation: Overview

Findings

Support from top management is important

Needs the right skills

OI managed top-down or bottom-up?

Implications

Top management has to be committed

Top management has to empower the OI Team

Create OI strategy aligned with corporate strategy

Have a CEO mandate

Top Management Implication 2:
Top Management has to empower the OI Teamvation: Overview

Top management gives the fundamental push to establish an OI implementation team [Mortara et al., 2009]

Create and empower the CDE task force [Bingham & Spradlin, 2011]

The innovation mandate should lay out the resources and authority given to the innovation team [Lindegaard, 2010]

Innovation leaders must feel full support from executives [Lindegaard, 2010]

Link with OI team

Sources:Mortara, L. et al. (2009): How to implement Open Innovation

The Open Innovation Marketplace (Bingham A - Spradlin D.) (2011)

Sloane, P. (2012): A guide to Open Innovation and Crowdsourcing

Lindegaard S. (2011): Making Open Innovation Work

Igartua, J. I., Garrigs, J. A., & Hervas-Oliver, J. L. (2010). How innovation management techniques support an open innovation strategy. Research Technology Management, 41-52.

Top Management in Open Innovation Innovation: Overview

Findings

Support from top management is important

Needs the right skills

OI managed top-down or bottom-up?

Implications

Top management has to be committed

Top management has to empower the OI Team

Create OI strategy aligned with corporate strategy

Have a CEO mandate

Top Management Implication 3:
Align OI strategy with corporate strategy: Overview

Top management should understand and buy into the creation of a tight link between innovation strategy and the overall corporate strategy [Lindegaard, 2010]

Establish the CEO mandate [Bingham & Spradlin, 2011]

Successful CEOs focus the organization on a small number of key initiatives and some choose a single theme or strategy that defines their administration

A CEO mandate makes that everyone in the organization will understand the importance and commitment attached to this program by the CEO

Never launch without a mandate from the CEO. [Open Innovation] cannot succeed if its cordoned off in R&D. It must be a top-down, companywide strategy [Huston & Sakkab, 2006].

Sources:Lindegaard, S. (2010): The open innovation revolution

Bingham A - Spradlin D.(2011): The Open Innovation Marketplace

References

Bingham A & Spradlin D. (2011): The Open Innovation Marketplace

Igartua, J. I., Garrigs, J. A., & Hervas-Oliver, J. L. (2010). How innovation management techniques support an open innovation strategy. Research Technology Management, 41-52.

Lindegaard, S. (2009)/

http://www.slideshare.net/StefanLindegaard/open-innovation-summit-stefan-lindegaard-presentation-2645946

Lindegaard, S. (2010): The open innovation revolution

Lindegaard S. (2011): Making Open Innovation Work

Mortara, L. et al. (2009): How to implement Open Innovation

Interview Rutledge H (Head of OI GSK) (2012)

Sloane P (2012): A guide to open innovation and crowd sourcing

Slowinski and Sagal (2010): Senior Management Roles in Open Innovation

Interview Chris Thoen (P&G) by Shaugnessy (2011)

Interactive poll 2

What are the three most important actions for top management to maximize impact?

Commitment

Financial support

Support to build culture for OI

Good understanding of OI

Establishment of OI-team

Link between (open) innovation strategy and corporate strategy

Sources:Mortara, L. et al. (2009): How to implement Open Innovation

Lindegaard S. (2011): The Open Innovation Revolution

Q&A

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