CHAPTER 5
FUTURE OF OPEN INNOVATION
Keys to success
Chapter 4
The race to integrate AI is raising the stakes for Open Innovation, making the success of these projects more critical than ever. As AI accelerates the pace of change, corporates must refine their approach to Open Innovation — learning what drives success and minimising failure — before falling behind becomes irreversible.
The accelerating push to adopt AI is reshaping how corporates approach Open Innovation. While obviously not all Open Innovation projects are AI-driven, the urgency surrounding AI adoption highlights the need for successful collaboration.
In an environment where speed and agility are paramount, failed collaboration projects are more costly — both in terms of lost time and missed opportunities. Organisations that fail to optimise their Open Innovation strategies risk losing competitive advantage and falling behind in the AI race, where the pace of development leaves little room for error.
Corporates are learning that success in Open Innovation requires more than simply partnering with startups. It demands clarity of objectives, a willingness to embrace external expertise, cultural alignment, and flexible processes that can accommodate the complexity of emerging technologies like AI.
The most successful organisations are those that view Open Innovation as a core strategic capability, not a side experiment — applying lessons from past projects to improve outcomes and reduce the margin for failure. As AI continues to advance at breakneck speed, this mindset is becoming a prerequisite for gaining resilience and staying competitive.
To succeed in Open Innovation and be truly productive there are some key factors to success that need to be in place:
success rates for corporates who have a dedicated department for startup collaborates (compared to 49% for those without)
73%
John Olav Tande, Senior Vice President, R&D and Innovation, Statnett
To succeed in Open Innovation and be truly productive there are some key factors to success that need to be in place:
To succeed in Open Innovation and be truly productive there are some key factors to success that need to be in place:
1. Understanding collaboration objectives
Being up front about what both parties want to achieve is imperative. Corporates and startups enter collaborations with very different objectives. Startups experience cultural differences as the biggest barrier, so it’s important for corporates to understand what startups want to get out of the collaboration, rather than just taking advantage of them to experiment and never actually reaching the procurement stage.
2. A clear value proposition
Corporates must also have a clear value proposition in order to attract startups. Corporates and startups have the same number of collaborations in a year but since there are more corporates than the most sought-after startups, corporates must make themselves attractive to those startups. They can achieve this by clearly setting out the specific problems they need to solve, explaining their internal commitment and willingness to share risk and reward, not to mention a clear “build-buy-partner” strategy outlining exactly which areas they seek startup collaboration.
3. Dedicated Open Innovation departments
Corporates who have a dedicated department for startup collaborations, who are able to align strategic priorities and engage the correct business functions, have a success rate of 73%, while those without have only a 51% chance of success.
A core objective of such departments must be to industrialise the collaboration process, allowing quick onboarding of new startups and experimentation with startups that use cutting-edge tech.
OI expert (ES) – How will OI change in the future?
2. A clear value proposition
Corporates must also have a clear value proposition in order to attract startups. Corporates and startups have the same number of collaborations in a year but since there are more corporates than the most sought-after startups, corporates must make themselves attractive to those startups. They can achieve this by clearly setting out the specific problems they need to solve, explaining their internal commitment and willingness to share risk and reward, not to mention a clear “build-buy-partner” strategy outlining in exactly which areas they seek startup collaboration.
5. Strategic importance and responsibility
The data also shows that the longer a corporate has been collaborating, the more strategically important and successful Open Innovation becomes. Responsibility also shifts with time moving from undefined for those new to Open Innovation, to middle management, and then top management for those more experienced in such collaborations.
This movement of responsibility might be signalling the level of corporate-maturity when it comes to having a clear build-buy-partner strategy, for what challenges large organisations plan to solve through acquisition, through in-house development, and through collaboration with external partners.
We saw earlier that the Telecommunications industry reports the greatest level of success in Open Innovation projects, and this is in part due to the fact they score highest in strategic importance and are as a result the most satisfied with the collaborations.
4. Third-party intermediaries
Half (50%) of corporates have hired a third-party intermediary to manage such projects, and for them the chance of success rises significantly from 60% to 73%. Remembering the culture divide, it seems it could be beneficial to use a third party who understands both sides and can bridge the gaps.
50%
of corporates have hired a third-party intermediary. Success rates rise from 60% to 73% with intermediaries
Christophe Rebours, Strategic Design Director, InProcess, Sopra Steria Next
Open Innovation must be part of the strategic agenda for success
It is clear that Open Innovation has to be a part of the strategic agenda as well as part of corporates’ larger innovation strategy and systemic approach. It cannot simply be a standalone effort.
When needs arise, there should be a consideration of which approach to innovation will give the highest value between building, buying and partnering. This, in combination with a defined Open Innovation-operating model including a structured process, is what will deliver true Open Innovation success.
[pull figure] 73% success rates for corporates who have a dedicated department for startup collaborates (compared to 51% for those without)
[pull figure] 50% of corporates have hired a third-party intermediary with success rates rising from 60% to 73% when they do
[videos]
1x Client testimonial (NO) – their experience of OI
1x AI expert (DE) – Prerequisites for using OI to build AI strategy?
1x OI expert (FR) – What are the keys to success?
1x external – Liza Plug and Play
Open Innovation is an important source of competitive advantage. It brings new capabilities to corporate clients and helps them solve problems with the cutting-edge technologies. The good news is that many European companies have become better at Open Innovation, which should help them navigate environmental turbulence.
Andrew shipilov
Strategy Professor, INSEAD
