Open innovation

It is basically an alternative to this conventional method of doing innovation where

information has to stay within preset confines. it to be the mindset of being open to sharing
and receiving information. However, although being a necessary point in internalizing the
concept, it doesn’t really elaborate as to what it actually is in practicality.
We have many examples of open innovation should encourage and inspire you to apply the
concept to your own business! The stakeholders from our examples of open innovation range
from product users to smaller companies, that complement the product or help solve your
problems, all the way to scientists and individuals wanting to participate in order to learn new
skills and gain valuable experience.

Benefits of Open Innovation

1. Engaging larger audiences
With open innovation, the audience size potential is vastly larger than in closed innovation. If
you want the input to be as large as possible, as you would for gaining insight on consumer
buying habits regarding an everyday household item, it is possible to expand the audience
without any apparent limits. Of course, it is important to note that with larger participation
come higher costs.

2. Engaging relevant audiences

In closed innovation, “audience relevance” is limited by the expertise of the employees within
the company, thus affecting what kind of topics can be focused on. With open innovation it is
only a matter of finding the right audience to solve your problem, whatever it may be. Of
course, this means that finding a relevant audience is also more difficult and costlier since you
have to narrow it down from a much larger audience to begin with.

3. Improving Cost efficiency

The overall costs in open innovation are likely to be smaller in relation to the amount of ideas
and input, which is especially profitable for companies in the downturn. Internal innovation
consumes work hours from employees as they participate in managing the innovation process,
as well as the ideation itself. In open innovation, the time used by employees mostly goes
towards managing the process.

4. Involve customers in R&D

Designing products or services according to customer need is always important, despite how
open or closed the innovation process is. However, open innovation additionally opens the
door for involving customers in the R&D process from the very beginning. This increases the
viability of the product as you get near instant feedback regarding which aspects or features are
necessary or useful to the end user and which aren’t.
 Types of Open Innovation
We have narrowed the levels of inclusion down to 4 different types:

 Intracompany: Inside the company or organization. Although, this could be considered a

contradiction to the definition of open innovation itself, it’s important to include this
level as inside a large organization it can be considered open innovation to collaborate
within different functions or business units.

 Intercompany: Between two or more different companies.

 For experts: All people outside the company who have the required knowledge to give
relevant input.

 Publicly open: All people regardless of previous knowledge or stature.

We have selected the following 4 areas to define different use cases in companies:

 Marketing: Getting information across

 Gathering insight: Valuable information on the market and customers

 Finding talent: Scouting for talent

 R&D: The most typical form where you develop products or services

 Mountain Dew – A Practical Joke Gone Bad

Mountain Dew is no stranger to open innovation. In the good, as well as bad, or at least so it
would appear.
In 2009 they released a platform named DEWmocracy where customers were able to develop
new lemonade flavors together. This venture was a huge success. Not only did they get new
flavors that accurately matched customer demand, but this project also worked as a marketing
channel for their new products.The success was, unfortunately, short lived.
Excited of their earlier positive experiences, they dove straight into a classic pitfall of open
innovation, the naming game. In 2012 Mountain Dew released their Dub The Dew campaign
with the apparent intent of getting a crowd-pleasing name for their new green-apple product.
Long story short, the campaign was an epic fail. At least on paper it was. The names that
gained traction were anywhere from practical jokes to atrocious profanities. Mountain Dew
later closed down the campaign and admitted their failure.
This may, however, also have been a strategic way to get viral media coverage. After all, in
the aftermath Mountain Dew didn’t look like an amateur out of their depth, but rather a victim
of unfortunate circumstance. The fault was with the trolls, while Mountain Dew was getting
great attention from media outlets around the world.
In conclusion, if viewed purely from the viewpoint of finding a new name for their product,
Mountain Dew’s worldwide open innovation challenge was very unsuccessful.