Open Business Models: How to Thrive in the New Innovation Landscape

Open Business Models: How to Thrive in the New Innovation Landscape
by Henry Chesbrough

Open Business Models: How to Thrive in the New Innovation Landscape
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Book Summary Information

Author: Henry Chesbrough
Edition: Hardcover
Published: 2006-12-06
ISBN: 1422104273
Number of pages: 256
Publisher: Harvard Business School Press

Book Reviews of Open Business Models: How to Thrive in the New Innovation Landscape

Book Review: Worthwhile Read for Some
Summary: 3 Stars

To put my response in context, I work with startup companies every day so I'm continually exposed to the importance of IP and business models and markets and markets and suppliers and distributors... many of the elements that that turn a cool idea or a cool technology into a profitable product.

From that perspective, both this book and Open Business Models are a disappointment. As I would suggest that you only read one (and in most cases the latter), I'll briefly review both here.

Open Innovation is supposed to bring attention to changing industry landscape. In this regard, it does a decent job to point out the trends in innovation and partnerships that are likely to drive companies forward. If you've missed out on IBM's reinvention of itself and are finding increasing pressures on your business, Open Innovation might give you some insight. Unfortunately, the content seems to border on obvious and, since it's thoroughly revisited in the latter book, it doesn't really make sense to read Open Innovation.

Marginally better, Open Business Models offers some simple frameworks or ideas about how to classify companies (based on their embracing of innovation and open innovation) and how companies move from one to another. While offering few or no "aha" moments, Open Business Models paints a decent roadmap of the transition, identifying pitfalls and opportunities. If you were responsible for this process in your company, it could help you understand where you are and how to get where you need to be.

If you're just looking for an insightful read and have any passing knowledge of open business models, I wouldn't bother with either. If you're responsible for this process in your company, try Open Business Models as it could be rewarding. Unless you're devouring everything you can find on the "open innovation" subject, I wouldn't really bother with Open Innovation.

Summary of Open Business Models: How to Thrive in the New Innovation Landscape

In his landmark book Open Innovation, Henry Chesbrough demonstrated that because useful knowledge is no longer concentrated in a few large organizations, business leaders must adopt a new, “open” model of innovation. Using this model, companies look outside their boundaries for ideas and intellectual property (IP) they can bring in, as well as license their unutilized home-grown IP to other organizations.

In Open Business Models, Chesbrough takes readers to the next step—explaining how to make money in an open innovation landscape. He provides a diagnostic instrument enabling you to assess your company’s current business model, and explains how to overcome common barriers to creating a more open model. He also offers compelling examples of companies that have developed such models—including Procter & Gamble, IBM, and Air Products.

In addition, Chesbrough introduces a new set of players—“innovation intermediaries”—who facilitate companies’ access to external technologies. He explores the impact of stronger IP protection on intermediate markets for innovation, and profiles firms (such as Intellectual Ventures and Qualcomm) that center their business model on innovation and IP.

This vital resource provides a much-needed road map to connect innovation with IP management, so companies can create and capture value from ideas and technologies—wherever in the world they are found.

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