TITLE

OPEN VERSUS CLOSED INNOVATION: A MODEL OF DISCOVERY AND DIVERGENCE

AUTHOR(S)
ALMIRALL, ESTEVE; CASADESUS-MASANELL, RAMON
PUB. DATE
January 2010
SOURCE
Academy of Management Review;Jan2010, Vol. 35 Issue 1, p27
SOURCE TYPE
Academic Journal
DOC. TYPE
Article
ABSTRACT
When is open innovation superior to closed innovation? Through a formal simulation model we show that an open approach to innovation allows the firm to discover combinations of product features that would be hard to envision under integration. However, when partners have divergent goals, open innovation restricts the firm's ability to establish the product's technological trajectory. The resolution of the trade-off between benefits of discovery and costs of divergence determines the best approach to innovation.
ACCESSION #
45577790

 

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