Nine Prevalent Options Of Collaborative Open Innovation

Collaborative open innovation with technology startups is attracting considerable interest among large corporations around the world. Despite this practical relevance, an extensive and comparative analysis on collaborative open innovation options and its characteristics has not yet been a focus of research.

This paper characterizes and contrasts nine prevalent options of collaborative open innovation that are used by large corporations to innovate with tech startups. In specific, this paper proposes a taxonomic framework for corporate venture capital, mergers & acquisitions, procurement, business incubators, corporate accelerators, corporate company builders, co-working spaces, startup platform programs and innovation labs, which delimitates their characteristics following a predefined set of characteristics (strategy, financing, startup target, structure, culture, resources, performance measurement and ecosystem-leverage).

A design science research has been conducted, following a literature review approach. The findings of this thesis provide academia with a theoretical foundation for further studies and offer terminological clarifications for both researchers as well as for innovation managers and opens up new avenues for research to validate and advance the framework’s general applicability.

Get quality help now

Doctor Jennifer

Verified writer

Proficient in: Innovation

5 (893)

“ Thank you so much for accepting my assignment the night before it was due. I look forward to working with you moving forward ”

+84 relevant experts are online

Hire writer

So as Tto gain access to new technologies that may affect business models and embrace both product and service innovation across products and services, it has become a noteworthy and rapidly developingfast rising trend for corporations to open up their innovation processes to collaborate with startup ecosystems (Yoo, Henfridsson & Lyytinen, 2010; Kohler, 2016). Especially with regard to the growing necessity for practitioners to find new ways to innovate (Dee, Gill, Weinberg & McTavish, 2015), it is of the utmost importancehigh significance to provide a comparative assessment of prevalent options of corporate open collaboration with startups.

Even though the practice of collaborative open innovation in all its forms options and the emergence of corresponding programs are evident among numerous large corporations these days, extensive and comparative analysis on the characteristics of such options has not yet been a focus of research as far as the researchers of the present study have been able to identify. Next to rather traditionally rooted collaboration options such as merger and acquisitions or corporate venture capital, nascent phenomena such as accelerators or incubators have recently received much attention both in Europe and across the globe (Cohen & Hochberg, 2014).

However, besidesexiting literary approaches (academic literature, studies and reports) that elaborate on those options, other organizations and applications often lack an in-depth analysis and only span a narrow frame or isolated description of common collaboration options. Most organizations are still experimenting with different ways of setting up and managing their collaboration programs (Kohler, 2016).

In Academia in particular, these options have not been made clear enough, has not been elucidating such options satisfactory and thus, only research of limited scientific rigor focusing on the more of prevalent options of collaboration between large corporations and technology (further abbreviated as tech) startups, as well as of their unique characteristics and organizational practices, is available (Isabelle 2013; Kim and Wagman 2012). For example, the discrepancy on the use of diverse collaboration options (e.g. corporate incubator vs. business incubator) adds to the lack of comprehensive data sources. This does not only complicate research, but also confuses the marketplace and its practitioners. Especially in the case of for innovation managers who want to make conscious decisions on which collaboration options to pursue, where a rigorously developed presentation of relevant collaboration options is required.

By conducting thorough a design science research, this paper identifies nine prevalent forms of collaborative open innovation and eight delimiting characteristics, and presenting setting them in contrast by proposing a taxonomic framework (Appendix). The results mainly contribute to further research by providing a concise overview of relevant collaboration options, supported with references from experts and examples of large European companies engaging in Silicon Valley’s startup ecosystem.

It becomes increasinglymore and more common for large corporations to innovate through open innovation. Opening up the innovation process to external partners has been recognized by both researchers and managers as a key to successful innovation (Aubert, Kishore & Iriyama, 2015; Chesbrough, 2003; Dee, Gill, Weinberg & McTavish, 2015).

Due to their agility, adaptive and resilient nature, startups are well known for their power to disrupt entire industries and play a key role in accelerating corporate innovationveness (Schättgen & Mur, 2016; Weiblen & Chesbrough, 2015). What we know is that partnerships between corporations and startups have been a common practice over many years. However, especially the practice of more formal partnerships, particularly collaborations with startups, have significantly increased in practice over the last ten years (Ringel, Taylor & Zablit, 2016; Schättgen & Mur, 2016; Neyens, Faems & Sels, 2010; Bannerjee, Bielle & Haley, 2016; Weiblen & Chesbrough, 2015; Kohler, 2016). Likewise, the effort of innovation managers from large companies make to apply engage with a variety of burgeoning open collaborative innovation options to reach out to startups is a notable and fast rising trend (Spender, Corvello, Grimaldi, & Rippa, 2017; Kohler, 2016; McCafferty, 2015; Oshri, Kotlarsky & Gerbasi, 2015; Weiblen & Chesbrough, 2015; Ringel et al., 2016; de la Tour et. al., 2016). Silicon Valley is renowned worldwide as an ideal ecosystem for technology innovation (Engel & del Palacio, 2009).

Thus, many large European corporations already have - or are planning to - set foot in this startup ecosystem to enhance their collaborative engagement (Mind the Bridge, 2017; Bonzom & Netessine, 2017). To keep up with this trend and to stay relevant in a fast-changing economy, the development of instructive knowledge about different collaboration options with startups is of crucial strategic significance for innovation managers in large companies.

Sarbacher et al (2016) developed in the context of open innovation eight different types of collaboration forms between startups and established companies. They then compared the different approaches in terms of level of innovation (incremental vs. disruptive) and culture (internal vs. external culture).

R&D and Entrepreneurship programs focus on individuals inside organizations pursue opportunities without regard to the resources they currently control, as doing new things, and as a spirit of entrepreneurship within the existing organization (Hisrich and Peters 1998 & Stevenson and Jarillo 1990). Innovation labs are dedicated facilities outside of the established companies that operate independently of the daily business for encouraging creative behaviors and supporting innovative projects (Lewies & Moultrie, 2005). Open innovation or crowd sourcing platforms are ways of doing business by activating and leveraging the integration of heterogeneous outside knowledge resources, aka, the wider population of innovators (Chanal, 2010). Co-Working are creative open-plan office environments in which innovation managers work alongside other unaffiliated professionals (Spinuzzi, 2012).

Incubators are company-supported flexible working space with additional value-added services such as centralized legal or marketing support (Bruneel, Ratinho, Clarysse, & Groen, 2012). They provide established companies a path to the market for corporate noncore innovations (Dee, Gill, Livesay, & Minshall, 2011; Miller & Stacey, 2014). Corporate accelerators are company-supported programs of limited duration that support cohorts of startups via mentoring, education, and company-specific resources (Kohler, 2016). Venturing permits corporations to participate in the success of external innovation and helps to gain insights into non-core markets and access to capabilities (Weiblen & Chesbrough, 2015).