In today's information-rich environment, companies can no longer afford to rely entirely on their own ideas to advance their business, nor can they restrict their innovations to a single path to market. As a result, says Harvard Business School Professor Henry W. Chesbrough, the traditional model for innovation--which has been largely internally focused, closed off from outside ideas and technologies--is becoming obsolete. Emerging in its place is a new paradigm, "open innovation," which strategically leverages internal and external sources of ideas and takes them to market through multiple paths. This path-breaking analysis is based on extensive field research, academic study, and the author's own longtime experience working in Silicon Valley. Through rich descriptions of the innovation processes of Xerox, IBM, Lucent, Intel, Merck, and Millennium, and the many spin-offs that have emerged from these firms, Open Innovation shows how a company can use its business model to identify a more enlightened role for R&D in a world of abundant information, better manage and access intellectual property, advance its current business, and grow its future business.Arguing that companies in all industries must transform the way they commercialize knowledge, Chesbrough convincingly shows how open innovation can unlock the latent economic value in a company's ideas and technologies.
Introduction; 1. Xerox, PARC, and the Limits to Internal Innovation; 2. The Closed Innovation Paradigm; 3. The Open Innovation Paradigm; 4. The Business Model - A Focusing Device for Internal and External Innovation; 5. From Closed to Open Innovation: The Transformation of the IBM Corporation; 6. Open Innovation at Intel; 7. Creating New Ventures out of Internal Technologies: Lucent and Its New Ventures Group; 8. Business Models and Managing Intellectual Property; 9. What Do I Do Monday Morning?; 10. Open Innovation and Public Policy; Appendix; Notes; Index; About the Author