Open Innovation: A Theory-Based View

Abstract

In this short essay we argue that open innovation requires a point of view—a firmspecific theory. In competitive environments, openness is not a free and obvious resource: openness can be costly and requires a theory of what a firm should uniquely be open to. Openness is most effective when firms are not merely scanning or filtering the environment, but rather when they know what they are looking for—a critical distinction. Thus we argue that the commonly-used funnel or filtering metaphor of open innovation—where the firm seeks to be more and more open to the environment—is misleading and problematic. Instead, openness should be conceived of as a directed activity: an activity directed by the theories, hypotheses and problems of the firm. To use a metaphor, rather than increase the aperture, lens size, breadth and overall capacity to be open to and absorb external factors (information, ideas, products, solutions), we argue that the best outcomes from openness emerge from a more targeted searchor flashlight approach. We conclude with a discussion of future directions building on this agenda.