Henry Chesbrough, the father of Open Innovation and the executive director of the Center for Open Innovation, Institute for Business Innovation at the University of California, Berkeley
Henry Chesbrough, the father of Open Innovation and the executive director of the Center for Open Innovation, Institute for Business Innovation at the University of California, Berkeley

Open Innovation: Adding value to products and services

Corporate October 20, 2017 01:00

By JIRAPAN BOONNOON
THE NATION

OPEN INNOVATION is a new paradigm to create value-added products and services to support business in the country.



Henry Chesbrough, the father of Open Innovation and the executive director of the Center for Open Innovation, Institute for Business Innovation at the University of California, Berkeley, said that open innovation is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal as well as external paths to market when they look to advance their technology. Open Innovation combines internal and external ideas into architectures and systems whose requirements are defined by a business model.

Therefore, the open innovation comes with two cores: the outside in and the inside out. The outside in is the technology going into the organisation, while the inside out is the project and idea inside an organisation that are going outside. 

“Open innovation is the use of purposive inflows and outflows of knowledge to accelerate internal innovation, and expand the markets for external use of innovation, respectively. [This paradigm] assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as they look to advance their technology," said Chenrough.

Open innovation is becoming more widespread. It is useful to create added value to products and services for organisations and businesses.

“Today, we see more activity in the ecosystems of many companies collaborating. The change is that technology has become much more digital with the development of digitalisation. Technology spreads event faster that they did before. Now, it is common that ideas come from different parts of the world. In digitalisation, we see new business model taking advantages in its capability. Thailand is a useful geographic area to be effectively engaged in going forward. Thailand is too small as a nation to do everything itself but it is capable enough to be a very important partner to the US, Japan and China," said Chenrough. 

He also said that investment in R&D and science are all parts of creating added value in support of businesses and the economy of a country. However, Thailand is still in the early stage of R&D development, with spending in science accounting around 0.62 per cent of GDP, compared with 4 and 3 per cent of GDP in Korea and North America respectively . 

"Thailand still has a long way to go in term of spending in R&D. The internal R&D is beginning in order to maintain our ability to attract interesting partners to collaborate and venture outside. If you do not have internal R&D and you do not have internal capability, it is very difficult to find outside partners," said Chenrough. He also suggested that the country should drive Thailand economy via natural resource such as agriculture, and mining because the economy is developed into a knowledge economy where supply from community enhances the value of products. 

Kan Trakulhoon, trustee of Thailand Management Association (TMA) and head of Private Sector for Public-Private Collaboration Committee on Innovation and Digitalisation said that Siam Cement Group had set up an open innovation office in order to disclose its technology and technological needs to develop and exchange ideas to support its operations and utilise existing technology to support both SCG’s and others’ businesses . The firm now has over 60 technology and innovation platforms to share with other business partners in the market.