HR and Open Innovation

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MOOI Theme 4HR and Open Innovation
Prof. Henry Chesbrough, University of
California, Berkeley ESADE Prof. Wim
Vanhaverbeke, Hasselt University, ESADE
National University of Singapore Dr. Nadine
Roijakkers, Hasselt University March 4, 2013
We would like to acknowledge the efforts of
Svenja Paul for providing input to this
presentation on the basis of her master thesis.
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Big gap in the (academic) literature

• Very little has been written in the academic
  literature concerning HR practices and the role
  of HR professionals in Open Innovation
• Golightly (2012) states that () there is
  considerable potential for further research into
  the people side of Open Innovation, including ()
  human resource practices ()

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The importance of HR practices

• Open Innovation is a people-driven business
• () Fundamentally, Open Innovation is about
  people dealing with people () (Harwood, 2010)
• Its therefore highly important to learn how HR
  practices related to both internal and external
  talent management can drive Open Innovation
  success

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Quotes
You can create followers, but you cant create
leaders - Tom Coen, Founder and Managing
Director at Induct
Openness exists in many people but it is
buried - Harry Berry, Founder of Brightstar
Innovations
People can be trained to be more open -
Lucienne van der Werff, VP HRM at DSM Innovation
Center
People should be a lot more proactive than
average in order to make quick changes - Marc
Hufkens, HRM and Deputy CEO at Ridley Bikes
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The relation between HR and OI effectiveness
HR practices (Internal and external talent
management)
Organizational climate / culture
Employees attitudes and behaviors
Open innovation effectiveness
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Internal talent management

• OI skills, traits, and roles relevant for
  selection, training, and evaluation purposes
• Other HR practices to stimulate OI behavior
• Dynamic view on HR in relation to OI

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OI skills, traits, and roles

• HR needs to select and train individuals for OI
  based on identified skills (du Chatenier et al,
  2010)
• Individuals should have the right capacities
  (Wagner Piller, 2012), skills (Mortara et al,
  2009), and capabilities (Golightly, 2012)
• Training is essential, rather than merely
  desirable, when preparing the company for open
  innovation(Mortara et al, 2009)

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Soft and hard skills

• Soft skills rather than hard skills underlie OI
  success
• OI performance evaluation should focus on these
  soft skills Its not only important what people
  get done but also how (Sloane, 2012)
• There should be a balance between hard and soft
  skills (Thoen, 2011)

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Necessary OI skills

• General (based on Thoen, 2011)
• T profile Breadth and depth fusing
  specialisation and generalisation
• Three legged stool The technical mastery, the
  organizational mastery, and the business mastery

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Listing of specific OI skills

• Entrepreneurship
• Internal and external networking
• Belief in change, bring about change, faciliate
  change, question status quo
• Tolerance of uncertainty and risk taking
• Need to learn, open to learn, and quick to learn
• Optimism, passion, and energy
• Able to grasp the big picture
• Team player

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Interactive poll 1

• What are the three most important skills for Open
  Innovation?
• Entrepreneurship
• Internal and external networking
• Belief in change, bring about change, faciliate
  change, question status quo
• Tolerance of uncertainty and risk taking
• Need to learn, open to learn, and quick to learn
• Optimism, passion, and energy
• Able to grasp the big picture
• Team player

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HR practices

• Strategic challenge exchange to stimulate change,
  creation of relations, exchange of ideas,
  acquisition of external knowledge, create
  interdisciplinary knowledge in employees, etc.
  (Donkor and Monti, 2010)
• Leads to high motivation and retention of staff
• Examples Google and PG swapping employees and
  network of four Swiss MNCs strategically
  exchanging staff frequently

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HR practices

• Open choice of career paths and researcher
  mobility within the firm (Petroni et al, 2012)
• Ideally all talents and future managers start in
  the RD department and then move further, so that
  RD knowledge is integrated in all departments
  (Petroni et al, 2012 Harryson, 1997)

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A dynamic approach

• Different skills are needed in different phases
  of the innovation process (Lindegaard, 2010)
• It is very rare for one person to possess all the
  ideal skills for OI different people may need to
  be involved in the OI activity at different
  points in time (Mortara et al, 2009)

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External talent management

• From 'talent ownership' to 'talent attraction
• Talents need to be kept connected even when not
  internally employed
• Attract and manage external talent in addition
  to finding the best internal talent
• Build and curate talent pools
• Create value for the external talent pool in
  order for them to want to stay connected
• Philips example on spinoffs

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People-driven OI

• Individuals and their attitudes are the driving
  force behind the success of OI (Du Chatenier et
  al, 2010 Lichtenthaler et al, 2011).
• Focus first on getting individuals to realize the
  potential value of Open Innovation, so that they
  can then put in place practices that realize its
  actual value (Golightly, 2012).
• The ability of an organization to increase the
  absorptive capacity of its individuals has come
  through strongly as a crucial step in realising
  OI value (Golightly, 2012).
• With respect to absorptive capacity people may
  be in a certain role today but have the expertise
  we're looking for because of previous experience.
  We often forget people are in their second and
  third careers (Byrum, 2012)

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The role of the HR department

• The HR profession will have to build new core
  competences in network orchestration and managing
  talent - no matter where the talent lives
  (Kelley, 2012)
• The HR department needs to redefine its role
  (Mattes, 2011) Establish a Chief Talent Officer
  Engage in building internal and external
  innovation networks Contribute to the design of
  these networks (with respect to e.g. cultural
  issues) Drive adoption of internal and external
  innovation networks Support OI implementation by
  providing leadership in culture change Drive OI
  into all of the firms business processes
  Consider OI leadership aspects when leader/top
  management positions are to be filled Bring in
  OI aspects when corporate structures and
  processes are redesigned Review existing
  training and coaching programs in the light of
  OI Design new training and coaching programs in
  the light of OI concepts

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Interactive poll 2

• What are the three most important focus points
  for the HR department?
• Establish a Chief Talent Officer
• Engage in building internal and external
  innovation networks
• Contribute to the design of these networks (with
  respect to e.g. cultural issues)
• Drive adoption of internal and external
  innovation networks
• Support OI implementation by providing leadership
  in culture change
• Drive OI into all of the firms business
  processes
• Consider OI leadership aspects when leader / top
  management positions are to be filled
• Bring in OI aspects when corporate structures and
  processes are redesigned
• Review existing training and coaching programs in
  the light of OI
• Design new training and coaching programs in the
  light of OI concepts

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References

• Golightly, J. (2012) Realising the value of Open
  Innovation
• Blog entry (2011a) innovation-3, Mattes, F. HR
  departments take the drivers seat in Open
  Innovation
• Blog entry (2011b) innovation-3, Mattes, F.
  Report from the German flagship conference on
  Open Innovation
• White paper (2012) innocentive, Kelley, B.
  Harnessing the global talent pool to accelerate
  innovation
• Harwood, R. (2010) Motivation in Open
  Innovation, University of Cambridge (audio
  interview)
• Du Chatenier, E. (2010) Identification of
  competencies for professionals in OI teams, RD
  Management, 30, 3
• Sloane, P. (2012) A guide to Open Innovation and
  crowdsourcing
• Interview Chris Thoen (2011) Chris Thoen on Open
  Innovation part II
• Lindegaard, S. (2010) The open innovation
  revolution
• Lindegaard S. (2011) Making Open Innovation work

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References

• Donkor, C. and Monti, F. (2010) Strategischer
  Talentaustausch als Erfolgsfaktor für
  Innovationen
• Mack, J. (2008) Google, PG swapping employees,
  Direct Marketing News
• Byron, E. (2008) A new odd couple Google, PG
  swap workers to spur innovation, The Wall Street
  Journal
• Wupperman, A. (2011) Kann man Talente
  tauschen? Open Innovation im Bereich Human
  Resources, Presseanzeiger
• Petroni, G. et al (2012) Open Innovation and new
  issues in RD organization and personnel
  management, The Int. Journal of Human Resources
  Management, 23, 1, 147-173
• Palensky, F. (2011) 3Ms Open Innovation,
  strategybusiness (Interview)
• Harryson, S. (1997) How Canon and Sony drive
  product innovation through networking and
  application- focused RD, Journal of Product
  Innovation, 14, 288-295
• Bingham A - Spradlin D. (2011) The open
  innovation marketplace

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References

• Interview with Byrum, J. (Global Head of Soybean
  Seeds and Traits RD, Syngenta) (May 2012). From
  Syngenta Thoughtseeders, IdeaConnection.
  Retrieved from http//www.ideaconnection.com/inte
  rviews/00304-Syngenta-Thoughtseeders.html
• White paper (2012) innocentive, Kelley, B.
  Harnessing the global talent pool to accelerate
  innovation
• Lichtenthaler, U. Hoegl, M. Muethel, M. (2011).
  Is your company ready for open innovation? In
  MIT Sloan Management Review, Vol. 53, no.1.

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