Open Innovation 2.0 and Horizon2020: Opportunities and Challenges

Horizon 2020 has been framed as a fundamental shift in how Europe funds research and innovation. The Horizon 2020 approach deviates from prior Framework programs in two important ways. First, there is a clear shift from supporting programs, which aim to develop new inventions and technologies, toward funding programs, which aim to generate new products, processes, services and business models that make a difference in people’s life. Second, the core evaluation criteria within Horizon 2020 are no longer the extent of scientific and technological progress but rather the societal impact of particular programs. In this way, the Horizon 2020 program wants to contribute to crossing Europe’s Valley of Death, referring to Europe’s relatively strong competencies in generating new scientific breakthroughs but relative poor track record in transforming these breakthroughs into commercially valuable innovations.

It is increasingly recognized that realizing such an important transition in focus and outcomes also requires an inherently different collaborative approach. Within DG CONNECT, the Open Innovation 2.0 concept has therefore been developed. This novel concept provides opportunities to realize the ambitious goals of Horizon 2020 in two fundamental ways. First, it emphasizes the need to move from a producer-centric to a user-centric innovation model, where the end user is seen as the focal actor in the innovation process. This implies that users should be intensively involved throughout the whole processes. The creation of Living Labs and the adoption of rapid prototyping are seen as important tools to realize such intimate collaboration with users. Second, the Open Innovation 2.0 concept stresses that, in order to maximize societal impact, it is vital to move from mono-disciplinary collaborative clusters to multi-disciplinary ecosystems, in which a wide variety of different actors come together.

At the same time, it needs to be stressed that such alternative collaborative approach also triggers new challenges. In my own research (Faems et al., 2005), for instance, I found evidence that, whereas collaboration with existing clients can substantially increase the ability of partners to incrementally innovate (i.e. improve existing products and services), it does not stimulate radical innovation (i.e. generation of products or services that are new-to-the-market). As the seminal work of MIT professor Von Hippel suggests, realizing radical innovation does not require collaboration with existing customers, but rather requires interacting with lead users or users that are at the front-end of the technology that is incorporated in products or services that a company offers. Second, whereas collaboration with a wide variety of actors definitely fosters radical innovation, it also triggers additional costs in terms of managing and fostering such ecosystems. In my own research (Faems et al., 2010), I found that these costs even tend to outweigh the innovation benefits of such collaborative endeavors in the short term, pointing to the importance of adopting a long-term perspective when evaluating the development of multi-disciplinary ecosystems.

In sum, the core characteristics of the Open Innovation 2.0 approach perfectly fit with the core objectives of the Horizon2020 program. At the same time, it triggers new challenges that will require creativity and perseverance of partners who are involved in this kind of collaborative endeavors.

References

Faems, D.; Van Looy, B. & Debackere K. (2005) The role of inter-organizational collaboration within innovation strategies: towards a portfolio approach. Journal of Product Innovation Management, 22: 238-251.

Faems, D.; de Visser, M.; Andries, P.; Van Looy, B. (2010) Technology alliance portfolios and financial performance: Value-enhancing and cost-increasing effects of open innovation. Journal of Product Innovation Management, 27: 785-796.