Entry #1This entry will focuson the impact of the transition from the closed innovation to the openinnovation in people behavior. The period between the end of the Second WorldWar and the mid-1980s is the golden age for internal Research & Development(R&D) Departments. New business development proceeds; marketing of newproducts changed and took place within the firm boundaries. Tension appearedwithin companies as innovation grows up.
As a result, people’s behavior hasevolved to better adapt to the new changes in today’s society. They have gonefrom a “closed circle” state of mind to one based on open-mindedness. Closed innovationconsist to have everything done inside the firm (Dasher, 2009). All theknow-how of the company is internal; closed innovation companies trust only theemployees they have recruited and trained to keep a better profit and a betterreputation. If you want something doneright you should do it yourself (Sales, 2014). As Chesbrough (2003)explained, closed innovation is due of lack of involvement of universities andgovernments in the early 20th century in industrial and commercial applicationsof scientific research. This lack of involvement has led companies to createtheir own R&D Departments to fully control the development cycles of newproducts. People bring their knowledge with them when they are taking anotherjob hence involving knowledge and processes flows between firm, especiallyinstance suppliers such as supply chain companies.
As the result, Not InventedHere’s syndrome appeared: everything that comes from outside is suspect bydefault and is unreliable (Chesbrough, 2003). For companies from closedinnovation, the goal is to come up with the best ideas in the industry to win. Becauseof this very closed side of mind, the need to be specialized in a field is feltin order to bring a plus to the company in which they will be employed. In the other hand,open innovation – term defined by Chesbrough in 2003 – is looking to knowledgeflowing for other companies in order to find the best possible market.
Businessesare seeking new knowledge – especially in the R Department – across boundariesof firm (Dasher, 2009) such as licenses, technologies, or even just ideas. Tothem, acquiring and developing the know-how from people outside the company aimto achieve greatest return and develop new business models. They are alsoflexible in their business planning (Dasher, 2009). It is the only way torealize the full potential of innovation efforts (Sales, 2014). New long-termtalent acquisition with external expertise are henceforth required to getinside a company. In order to have a clear vision of the company, employershave to be tacit, but explicit as their knowledge should came from differentexperiences and researches (cf. know-how and know-why, Nonaka 2003).
We can seehow open innovation impacts life with the growth of Microsoft, the firstsoftware and electronical multinational company who buys nonexclusive rights tothe prototype (1980) and all rights to the first commercial version a yearlater. Nowadays, companieshave shifted from so-called closed innovation processes towards a more open wayof innovating. In order to increase their efficiency and effectiveness of theirinnovation processes, a lot of different businesses had started to look forsome other possibilities (Chesbrough, 2003).
Open innovation proves that byfinding best researches and ideas, and regardless of if it originatedinternally or externally, profit is more valuable and the value is maximizing.In any cases, companies are seeking a brilliant understanding of marketpsychology and potential new markets (Dasher, 2009) as well as developing theirbusinesses with or without outside knowledges. Open innovation presents morecomplex challenges than closed is innovation as it requires different knowledgefrom people across firms.
Thepossibility for good and promising ideas and technologies to be furtherdeveloped outside the firm increase. The mobility and availability ofhighly educated people with large amounts of knowledge exist outside theresearch laboratories of large companies. They do not hesitate to change jobsin order to acquire new experiences and share their knowledge with everyone. Open innovation andclosed innovation are aims to become a model of discovery and divergence(Almirall and Casadeus-Masanell, 2010).
Sales (2009) describes the importancefor a business to choose between open innovation and closed innovation: allorganizations need to innovate with times in order to stay relevant in theirindustry and interesting to their customer base. They need to be aware andrecognize when it’s time to change plans. To take better account of thosechanges, the first step is to build innovation into their business model. Asthe result, strong external sources of knowledge will cooperate a newacquisition skills for the purpose of introducing a clear vision of companydirection and strengths. As for instance, suppliers and competitors cooperateand create more customer value in people behavior (Chesbrough, 2003) with thesupport of universities and cooperation between firms. No innovation system iscompletely open or completely closed (Nonaka, 2007). Entry #2This entry will focuson the role of the boundary spanning in today’s leadership.
It is important toknow how to manage a team, especially when your company is at stake. But how doyou go about being the most effective in your role while being a good manager? Foryears, leadership was linear. The decision-making power is owned by the GeneralOffice. Therefore, a new way of conducting leadership due to the complexity intoday’s world. A good leader should be able to create directions andcommitments across boundaries in service, as well as work between differencesthat traditionally divide them. From communication to a different hierarchicalsystem, boundary spanning occurs in today’s businesses. ‘Boundary’ is defined by the area of knowledgepossessed by individuals (Rogers and Kincaid, 1981; Conway, 1997; Lehrer,2012).
To make a business unique, Nonaka (Harvard Business Review, 2007) also explained the “knowledge-creativity”with the know-how tacit knowledge and know-why explicit knowledge, a newboundary-spanning communication, in his knowledge spiral model which includefour modes of knowledge-conversation: Socialization, Articulation, Combination,Internalisation. According to Rogers and Kincaid (1981), Conway (1997) and Lehrer (2012),the boundary-spanning communication is the communication withindividuals (or groups) of different social and/or technical backgrounds andskills. As an example, using intranet applications became the new boundaryobjects-in-use, especially the Q applications (Levina and Vaast, 2005) asit created an internal communication into all different sector in a samecompany. It is leading to novel innovation entails a balance between similarityand dissimilarity, and prevent the lack of openness which could cause thepooling of ignorance. But, what would have happened if communication had notimproved? If it is poorly managed, the system would be chaotic. Another moreunderstandable leader would take over, thus showing tension within the group.
For that reason, boundary-spanning communication is really important,especially in growing enterprise, and mainly as a leader position. Nowadays, newleaders must have a managerial spirit to better handle their business. Morethan just controlling, the goal of a head of a company is to delegate as muchas possible to better develop his business, and retain its employees.
Spanningboundaries of diverse professional and organizational settings can become a keyorganizational competence (Lenia and Vaast 2005; Grant 1996; Nonaka 1994; vonHippel 1988). In the early 19th century, the “Agency Form” was the model forevery company. The owner was also the leader who managed and controlled everyemployee without any hierarchy. At the end, the organization changed and becamemore structured: it is managed by a General Office, itself divided by divisionswhich grouped other departments (the “pyramidal hierarchy”, or the FormalOrganization/Chart).
Managers were managing their team vertically, means theinformation was passed from Seniors to employees (according to the pyramidhierarchy). Few feedbacks were transmitted from both sides of the group, usingonly direct reports as communication. The control was high, and the autonomywas limited. Then, since the 1920’s, the “Multi-divisional structure” arrived:each division takes the functional structure with a set of functionaldepartments. Every subdivision got a specific manager until the General Office,who is still remain the main leader of the company.
In the current world ofwork, it is essential for managers to have a privileged connection with theirteam, as well as work in close collaboration with the functions, places andother stakeholders of their team. According to Yip, Ernst and Campbell (2009) researches, “global competition,changing demographics, and increasing cross- organizational exchanges areradically changing the market dynamics in which leaders operate, requiringleaders to operate beyond the boxes and lines of traditional organizationalcharts”. Furthermore, this new managerial structure also shows the limits ofleadership, namely having the ability to lead multiple affiliates whilemaintaining a lofty goal. Besides, 86% of senior managers feel it is”extremely important” for them to have their leadership role on theirteam, however only 7% of these executives say they are really effective in thisrole (Yip, Ernst and Campbell, 2009). This gap opens up a new area ofleadership, where the challenge is also an opportunity, and the goal is tocreate a new business environment. The boundary spanninghas lead the today’s leadership. Communication improved, especially theinternal one, which expanded the capacity of many businesses.
Thanks to a newhierarchical system, from an agency form to a better pyramidal hierarchy,companies perform better with better effective teams as before. Nevertheless,despite the improvement of the leading position, and depending of theenvironment and line of business, it is still not well mastered from most oftoday’s leaders. It requires extensive efforts to control this positon. Forthat reason, it is important to pay attention to other boundary-spanning willinitiate a new way to lead people efficiency.
Entry #3Pixar promotesboundary-spanning communication by rolling a new work environment, the peerculture, where everyone in techno-logical team, artistic team and shareholdersneed to share and exchange information in order to progress and succeed. Thereis no barrier; everyone is encouraged to give their opinion and give theirideas no matter their hierarchical position in the company. From Pixar’sprospective, “if you give a good ideato a mediocre team, they’ll screw it up. But if you give a mediocre idea to agreat team, they’ll make it work” (Harvard Business Review, 2008).
Comparingsome other companies, Pixar’s teams are working in parallels, making sure togive enough advices to each other on the ongoing project which allow them tocorrect the mistakes or improve the story boarding as early as possible as itshows with Toy’s Story 1 & 2. In Nonaka’s knowledge spiral model, the boundary-spanning communicationis taking place in the “knowledge-creative” (Harvard Business Review, 2007)which include four modes of knowledge-conversation: Socialization,Articulation, Combination, Internalisation. To define those four modes, Nonakauses two different models – the “know-how” tacit knowledge and the “know-why”explicit knowledge – and involves a good balance between metaphors and analogyundergoes. With his theory, Nonaka is making each business organization unique.