Application of Open Innovation in Modern Organisations : Benefits and Barriers

This paper examines the argument that open innovation is either a fad or a phenomenon. A massive amount of literature was reviewed on four open-innovation related themes - Drivers of open innovation, benefits gained by practising open innovation, the challenges limiting its widespread adoption, and real-life cases of open innovation approach. The findings reveal the following: First, motivation for openness includes the quest for increased ideas, limited complementary resources, and the perception of derived benefits. Second, open innovation enhances organisational performance in terms of the increased internal knowledge base, continuous availability of ideas for product development and commercialisation, and increased bottom-line profitability. Third, the numerous real-world example of firms that openly innovate indicates that open innovation is a phenomenon and not a fad. The practical implication is that firms should strengthen their internal capabilities to seek external ideas, share information willingly, and collaborate meaningfully with external partners