Divergent Paths in Open Innovation: Market Dynamics vs. Community Collaboration PPT

This PPT slide, part of the 26-slide Open Innovation Management PowerPoint presentation, presents a comparative analysis of 2 distinct approaches to open innovation: competitive markets and collaborative communities. It outlines the fundamental differences in how external innovators interact and contribute within these frameworks.

In competitive markets, external innovators provide variations of products, focusing on substitutable components. The governance structure is formal, emphasizing contractual relationships and market dynamics. Innovators in this space tend to have competitive relationships, with profit motives driving their contributions. Value capture for platform owners typically occurs through direct contracts and licensing agreements with these innovators.

Conversely, collaborative communities foster a more informal governance model, where interactions are socially embedded and based on norms rather than strict contracts. Here, external innovators engage in cooperative relationships, sharing technology and knowledge freely. The motivations for participation are varied, encompassing both extrinsic rewards and intrinsic satisfaction. Value capture in this context is less direct, often relying on increased platform demand generated by innovations from the community.

The slide also provides examples to illustrate these concepts. Competitive markets are exemplified by the Nintendo Wii and the Apple App Store, where third-party developers are encouraged to create competing products. In contrast, open-source communities like Linux and Ethereum showcase collaborative innovation, where contributions are made freely and collectively.

The concluding statement emphasizes the importance of selecting the right approach based on the significant differences between these 2 models. This insight is crucial for organizations looking to align their innovation strategies with their overall objectives.

This slide is part of the Open Innovation Management PowerPoint presentation.

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