Podcast
Questions and Answers
What is innovation?
What is innovation?
Innovation is the process and outcome of creating something new, which is also of value.
What are the three types of innovation? Explain each.
What are the three types of innovation? Explain each.
The three types of innovation are incremental, distinctive and disruptive innovation. Incremental innovation is characterized by a new product that incorporates a few new elements than the previous one, without changing the basic functionalities. Example: light bulbs; razors. Distinctive innovation is characterized by a new product that incorporates a few attributes which correspond to previously non-existing functions. Example: smartphones. Disruptive innovation is characterized by a complete breakdown of the previous existing products. It may arise in response to the satisfaction of a certain need, or by creating a new need which previously did not exist. Example: Internet; chip.
Who coined the term 'open innovation' and when?
Who coined the term 'open innovation' and when?
Henry Chesbrough, a professor and executive director at the Center for Open Innovation at UC Berkeley, coined the term 'open innovation' in his 2003 book "Open Innovation: The new imperative for creating and profiting from technology".
What are the main differences between open and closed innovation?
What are the main differences between open and closed innovation?
What are the two main functions of a business model?
What are the two main functions of a business model?
Explain product, process, marketing and organizational innovation.
Explain product, process, marketing and organizational innovation.
What are the challenges in outbound open innovation? (Select all that apply)
What are the challenges in outbound open innovation? (Select all that apply)
Two main modes of open innovation are: _______ and _______.
Two main modes of open innovation are: _______ and _______.
________ is the firm's ability to explore and acquire external knowledge.
________ is the firm's ability to explore and acquire external knowledge.
A firm's capability to internally explore knowledge, i.e. generate new knowledge inside the firm is known as _______.
A firm's capability to internally explore knowledge, i.e. generate new knowledge inside the firm is known as _______.
A tendency for people and organizations to avoid things that they didn't create themselves is known as _______ syndrome.
A tendency for people and organizations to avoid things that they didn't create themselves is known as _______ syndrome.
A business model performs two important functions: _______ and _______.
A business model performs two important functions: _______ and _______.
The Closed Innovation paradigm assumes that you must “make” your ideas and monetize them through _______.
The Closed Innovation paradigm assumes that you must “make” your ideas and monetize them through _______.
Intellectual property refers to the subset of ideas that are _______, _______, _______, and have been reduced to practice in a _______ form and have been managed according to the law.
Intellectual property refers to the subset of ideas that are _______, _______, _______, and have been reduced to practice in a _______ form and have been managed according to the law.
_______ is a cycle of transformation of individual knowledge into organisational, which is explicit to tacit, whereby other individuals or groups learn through practice.
_______ is a cycle of transformation of individual knowledge into organisational, which is explicit to tacit, whereby other individuals or groups learn through practice.
An innovation characterized by a significant change in one element but same overall architecture is known as _______.
An innovation characterized by a significant change in one element but same overall architecture is known as _______.
_______ coined the term open innovation. In 2003 he wrote a book called "The New Imperative for Creating and Profiting from Technology".
_______ coined the term open innovation. In 2003 he wrote a book called "The New Imperative for Creating and Profiting from Technology".
The four pillars of the knowledge economy are: _______, _______, _______, and _______.
The four pillars of the knowledge economy are: _______, _______, _______, and _______.
_______ is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology.
_______ is a paradigm that assumes that firms can and should use external ideas as well as internal ideas, and internal and external paths to market, as the firms look to advance their technology.
_______ is the systematic management of innovation processes. It refers both to product, process, and organizational innovation.
_______ is the systematic management of innovation processes. It refers both to product, process, and organizational innovation.
4P of innovation space are: _______, _______, _______, and _______.
4P of innovation space are: _______, _______, _______, and _______.
_______ assumes that an organization must discover, develop, manufacture and deliver itself in order to profit from research and development.
_______ assumes that an organization must discover, develop, manufacture and deliver itself in order to profit from research and development.
The common definition of _______ is when a division of a company or organization becomes an independent business.
The common definition of _______ is when a division of a company or organization becomes an independent business.
Firm's capability to internally retain knowledge over time is known as _______ capacity.
Firm's capability to internally retain knowledge over time is known as _______ capacity.
_______ is a model that sequences possible business models from very basic (and not very valuable) models to far more advanced (and very valuable) models.
_______ is a model that sequences possible business models from very basic (and not very valuable) models to far more advanced (and very valuable) models.
_______ involves the whole process from opportunity identification, ideation or invention to development, prototyping, production marketing and sales.
_______ involves the whole process from opportunity identification, ideation or invention to development, prototyping, production marketing and sales.
Open Innovation combines internal and external ideas into architectures and systems whose requirements are defined by a _______.
Open Innovation combines internal and external ideas into architectures and systems whose requirements are defined by a _______.
The business model influences the management of intellectual property.
The business model influences the management of intellectual property.
The value comes from the party that has a business model to create and capture value from the patent, not from the invention of the patentable technology itself.
The value comes from the party that has a business model to create and capture value from the patent, not from the invention of the patentable technology itself.
Protecting ideas is costly and time consuming.
Protecting ideas is costly and time consuming.
Open innovation assumes that an organization must discover, develop, manufacture and deliver itself in order to profit from research and development.
Open innovation assumes that an organization must discover, develop, manufacture and deliver itself in order to profit from research and development.
How companies should manage IP: First they must connect management of their IP to the underlying technology life cycle of that IP and second, they shouldn't change the management of IP surrounding the technology in the stages of the technology life cycle.
How companies should manage IP: First they must connect management of their IP to the underlying technology life cycle of that IP and second, they shouldn't change the management of IP surrounding the technology in the stages of the technology life cycle.
Patents do directly protect technologies.
Patents do directly protect technologies.
Patents allow you to exclude others from practicing a technology that is covered by your patent.
Patents allow you to exclude others from practicing a technology that is covered by your patent.
At the initial phase, the management of IP greatly depend on whether technology fits well with business model.
At the initial phase, the management of IP greatly depend on whether technology fits well with business model.
The closed innovation paradigm assumes that you must make your ideas and monetize them through your own products.
The closed innovation paradigm assumes that you must make your ideas and monetize them through your own products.
Absorptive capacity is the firm’s ability to explore and acquire external knowledge.
Absorptive capacity is the firm’s ability to explore and acquire external knowledge.
Knowledge is data that have been organized, grouped or categorized into some pattern.
Knowledge is data that have been organized, grouped or categorized into some pattern.
IP is the cost you pay to defend your knowledge and keep it from competitors.
IP is the cost you pay to defend your knowledge and keep it from competitors.
Open Innovation combines internal and external ideas into architectures and systems whose requirements are defined by a business model.
Open Innovation combines internal and external ideas into architectures and systems whose requirements are defined by a business model.
A new or significantly improved production or delivery method which includes significant changes in techniques, equipment and/or software is known as marketing innovation.
A new or significantly improved production or delivery method which includes significant changes in techniques, equipment and/or software is known as marketing innovation.
Open innovation has two dimensions: inbound and outbound open innovation.
Open innovation has two dimensions: inbound and outbound open innovation.
Intellectual property refers to the subset of ideas that are:
Intellectual property refers to the subset of ideas that are:
What are NOT a company's forms of IP:
What are NOT a company's forms of IP:
One thing that is well known and well accepted among those who study or work in technology is that technology changes:
One thing that is well known and well accepted among those who study or work in technology is that technology changes:
In the hierarchical process model of knowledge management for innovation the nurture phase is NOT characterized by which routine:
In the hierarchical process model of knowledge management for innovation the nurture phase is NOT characterized by which routine:
In managing knowledge what are the main tasks to look at:
In managing knowledge what are the main tasks to look at:
A new or significantly improved production or delivery method which includes significant changes in techniques, equipment and/or software:
A new or significantly improved production or delivery method which includes significant changes in techniques, equipment and/or software:
Organisations can acquire knowledge by:
Organisations can acquire knowledge by:
A good or service that is new or significantly improved:
A good or service that is new or significantly improved:
Type of innovation is characterised by a complete breakdown of the previous existing products. It may arise in response to the satisfaction of a certain need, or by creating a new need which previously did not exist:
Type of innovation is characterised by a complete breakdown of the previous existing products. It may arise in response to the satisfaction of a certain need, or by creating a new need which previously did not exist:
What is NOT the pillar of the knowledge economy:
What is NOT the pillar of the knowledge economy:
The investment of corporate funds directly in external start-up companies is known as:
The investment of corporate funds directly in external start-up companies is known as:
Challenges in outbound Ol imply:
Challenges in outbound Ol imply:
The firm’s ability to explore and acquire external knowledge:
The firm’s ability to explore and acquire external knowledge:
Firm’s capability to internally explore knowledge, i.e. generate new knowledge inside the firm:
Firm’s capability to internally explore knowledge, i.e. generate new knowledge inside the firm:
A model that sequences possible business models from very basic (and not very valuable) models to far more advanced (and very valuable) models:
A model that sequences possible business models from very basic (and not very valuable) models to far more advanced (and very valuable) models:
The use of purposive inflows:
The use of purposive inflows:
Which is the least effective way to acquire knowledge:
Which is the least effective way to acquire knowledge:
Inbound open innovation implies:
Inbound open innovation implies:
Flashcards
Innovation
Innovation
The process and outcome of creating something new and valuable, encompassing opportunity identification, ideation, development, marketing, and sales.
Incremental Innovation
Incremental Innovation
Small improvements or additions to an existing product or process without changing its core functionality.
Distinctive Innovation
Distinctive Innovation
New product with some similar features to the previous one, but incorporating new functions.
Disruptive Innovation
Disruptive Innovation
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Open Innovation
Open Innovation
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Closed Innovation
Closed Innovation
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Inbound OI
Inbound OI
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Outbound OI
Outbound OI
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Absorptive Capacity
Absorptive Capacity
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Inventive Capacity
Inventive Capacity
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Not-invented-here Syndrome
Not-invented-here Syndrome
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Business Model
Business Model
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Value Creation
Value Creation
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Value Capture
Value Capture
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Product Innovation
Product Innovation
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Process Innovation
Process Innovation
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Marketing Innovation
Marketing Innovation
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Organizational Innovation
Organizational Innovation
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Intellectual Property (IP)
Intellectual Property (IP)
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Innovation Management
Innovation Management
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Spin-out
Spin-out
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Transformative Capacity
Transformative Capacity
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Business Model Framework
Business Model Framework
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Study Notes
Essay Questions
- Innovation: The process and outcome of creating something new and valuable. It encompasses opportunity identification, ideation, development, prototyping, production, marketing, and sales (entrepreneurship often just involves commercialization). Adapting to new innovations (products, processes, strategies, organization) is vital.
- Incremental Innovation: New products with a few new elements compared to the previous versions, without altering core functions (e.g., light bulbs, razors).
- Distinctive Innovation: Products that build on previous products but add new, not previously existing functions (e.g., smartphones).
- Disruptive Innovation: Products or services that completely alter existing ones by addressing new needs or satisfying a need in a totally new way (e.g., the Internet, microchips).
Open Innovation
- Open Innovation: A paradigm where firms leverage both internal and external ideas and paths to market to advance technological development.
- Coined By: Henry Chesbrough.
- When: 2003 (In his book "Open Innovation: The new imperative for creating and profiting from technology").
Open vs. Closed Innovation
- Closed Innovation: The traditional approach where companies develop and market innovations independently. Key aspects: internal R&D, internal idea generation, and a controlled market entry path. A company discovers, develops, produces, and ships itself.
- Open Innovation Differences: Companies actively seek out and use external ideas. External R&D can create significant value, and companies don't need to create the research to profit from it. Business models should be improved more than quickly getting to market.
Inbound and Outbound Open Innovation
- Inbound Open Innovation: The use of purposive inflows of external knowledge. Acquiring existing knowledge, new knowledge collaborations, corporate ventures, capital, or alliances are examples of inbound activities.
- Outbound Open Innovation: Involves the use of purposive outflows of internal knowledge. Includes bringing product ideas to the market, selling or licensing intellectual property, or multiplying technology.
IP Management
- Closed Innovation Paradigm IP Management: Focuses on creating and maintaining control over ideas to exclude others.
- Open Innovation Paradigm IP Management: Actively buys and sells intellectual property to leverage ideas. Utilizes IP to leverage its own business and profit from others' use.
Business Model
- Two Main Functions:
- Value Creation: A series of activities from procuring raw materials to satisfying the consumer.
- Value Capture: Companies earning profits from portions of their value creation activities.
Types of Innovation
- Product Innovation: A new or significantly improved good or service.
- Process Innovation: A new or significantly improved production or delivery method.
- Marketing Innovation: A new methodology for presenting a product (e.g., packaging, placement, promotion, or pricing).
- Organizational Innovation: A new method in business practices, the workplace, or outside (external) relations.
Challenges in Outbound Open Innovation
- Complexities: High transaction costs, difficulties in finding suitable partners, time and financial constraints.
- Internal conflicts: Imbalance occurs between open innovation activities and day-to-day operation.
Open Innovation Modes
- Inbound: Exploiting external knowledge.
- Outbound: Acquiring external knowledge or technology.
Aspects of IP
- Absorptive Capacity: The firm's ability to explore and acquire external knowledge.
- Inventive Capacity: The firm's ability to internally generate new knowledge.
- Intellectual Property (IP): Ideas that can be legally protected to create or maintain control.
- True/False Questions about Open Innovation: Answers provided in the document.
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