For example, it seems that one of the daunting issues facing management when contemplating such a move is to redefine the firm’s value proposition. I can illustrate one example from a recent conversation with a book author. He wrote his first book about 25 years ago and his most recent in 2004. He was lamenting that his most recent book can now be downloaded from several web sites. Aside from whether the availability of his book on these sites is legitimate, let’s assume that it is, to him it means that he is not being compensated for the consumption of his work product.

I think this is a relevant example because. as in open innovation, the value of his work has shifted from the physical representation of his work — the book — to something else. He could see this as a new opportunity to gain credibility as the expert he clearly is that will lead to other “value generating” activities (e.g., career enhancement, consulting engagements, etc.).

Perhaps this is a trivial example of open innovation, but I think the basics are there. For firms that move toward open innovation they clearly have to accept that “always invented here” meant they could patent their ideas and build a patent portfilio of some value of its own, while also generating profits from products and services flowing from the inventions/innovations. But if they are content to not own the inventions themselves, then a new value proposition needs to established to make it all worth the effort.

I don’t know the answer to this question. I suspect it varies by firm, product, service and industry – but I’m reasonably certain it’s a major question facing the prospectcs of open innovation.

Agree? Disagree? Thanks!

You are so right! I guess I didn’t post that one- I know I saw it and was totally sucked in! His stuff is great. I find myself on his 43 folders site as well ( http://www.43folders.com/about ). He always seems to have something good going on.

Thanks for adding that. Great to see you again!

Another good presentation you might want to check out, which shows the power of simplicity and visual appeal is Merlin Mann’s Google Talk at http://video.google.com/videoplay?docid=973149761529535925