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Report: 95% of organizations are now practicing open innovation

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Open innovation — a democratized approach to innovation where collaboration among internal and external resources replaces conventional closed R&D silos — is fast becoming ubiquitous. An impressive 95% of organizations now report leveraging open innovation practices, with 54% doing so on “most” or “all” projects, according to a new research report from The Economist that was sponsored by SUSE.

Respondents paint a picture of rapid adoption across many of the key pillars of open innovation (or report planning to over the next three years). Those pillars include implementing a dedicated team to support open innovation initiatives, senior leadership positions (with titles like “Manager of Open Innovation”), standardized innovation procedures and metrics, open source technology adoption and related licensing/IP management systems. That said, internal closed innovation practices remain far more common across product, service, and process development –making clear that open innovation practices still have substantial space to grow within enterprises.

However, several notable barriers are hampering more widespread open innovation adoption. Increased time and managerial costs stand as the greatest obstacle to implementing open innovation models, cited by 28% of the technology leaders surveyed. Close behind, 27% of respondents pointed to increased managerial and organizational complexity, while 25% reported reliance on outdated or insufficient technology. Another 25% named regulatory risks, and 23% cited conflicting expectations between their organizations and partners.

The report also found that nearly all respondents (91%) acknowledged that their organizations will increase the budget allocated to open innovation projects over the next three years, with 85% reporting this will include increased funding for open source technologies.

The takeaways from this report are clear: firms that successfully pursue open innovation reap significant dividends and command competitive advantages that span across their businesses. 

The report surveyed 500 technology executives across five industries (automotive, financial services, manufacturing, retail/consumer goods, and telecom) and three countries (the United States, the UK, and Germany). Based on responses across 65 factors, organizations received a 0-100 rating based on their progress toward — and success with — open innovation practices.

Read the full report from The Economist.

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