STIINPL › Public sector research - shaping factors - open innovation
What does ‘open innovation’ refer to?
Companies increasingly rely on outside innovation for new products and processes and have become more active in licensing and selling results of their own innovation to third parties. The open innovation model is typically contrasted with the so-called traditional closed model, in which companies innovated internally, relying primarily on their own R&D departments to develop new products and processes (OECD, 2008a). Open innovation is not necessarily a within-country phenomenon but can involve international sourcing of innovations. This is closely related to the operation of international value chains and how countries participate in them.
PUBLIC SECTOR RESEARCH
How is open innovation relevant to the contributions of public sector research activities to innovation performance?
If firms adopt increasingly open innovation strategies, then a number of channels of interaction with public sector research begin to open up further. These include R&D collaboration and technological development by research universities and PRIs for private firms, particularly for large firms (including foreign ones) and high-tech SMEs that have embraced such innovation strategies. Moreover, knowledge markets become more viable channels for exploiting knowledge. Innovation sourcing is often global in nature, so there is little guarantee that local firms will source from local research universities and PRIs. Indeed, when firms do source from public sector research, they tend to do so from centres of excellence.
How does open innovation shape the interests, activities and resources of the relevant actors?
Open innovation is an idea that shapes the way firms view their innovation activities and plan them accordingly. The idea has attraction in that it reduces the amount of R&D and design work done in-house and instead exploits expertise found elsewhere, including that found in research universities and PRIs. There are limitations to the extent to which different firms will apply such procedures in that they will not want to “externalise” their core capabilities. For instance, firms operating in sectors marked by fast-moving technological development need to retain strong absorptive capacities to adopt new ideas; reducing in-house innovation activities might lead to a loss of such capacity.
Open innovation offers research universities and PRIs more expansive roles in fostering national innovation systems. In this sense, it is in their interests to exploit firms’ open innovation strategies, which offers new channels for research commercialisation. But success in linking research capacities and intellectual property to private businesses will require certain capabilities, for example, around the management of partnerships with the private sector, including issues of IP (which might be managed by technology transfer offices). Where these are weakly developed, the opportunities for exploiting firms’ open innovation strategies will be few and far between. Success will also depend upon the types of research being carried out and their fit with the innovation needs of firms.
What policies are relevant to open innovation and its shaping of the contributions of public sector research to innovation performance?
Several policies seem relevant to foster open innovation. These include specifically those aimed at strengthening ties between public and private sectors such as university-industry linkage schemes, science and technology parks as well as collaborative R&D programmes.
OECD (2008a), Open Innovation in Global Networks, Paris, OECD.
OECD (2008b), The Internationalisation of Business R&D, Paris, OECD.
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