Small Group Exercise 2 The chapter compares and contrasts closed versus open innovation. It also describes Procter & GambleĂ˘â‚¬â„˘s Connect+Develop open innovation system. With your group members, brainstorm to prepare a brief memo with a set of talking points regarding the following questions:
1. What are some of the risks of an open innovation approach that a company should consider before embarking on it?
Ă‚Â 2. Do you believe P&GĂ˘â‚¬â„˘s Connect+Develop (C+D) open innovation system has the potential to create a competitive advantage for the firm? How might P&GĂ˘â‚¬â„˘s capabilities be strengthened as a result? If C+D does have the potential to create a competitive advantage, do you believe it is sustainable? Why or why not?
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3. Larry Huston and Nabil Sakkab, (former) executives at P&G, proclaimed, Ă˘â‚¬Ĺ“Connect+Develop will become the dominant innovation model in the 21st century.Ă˘â‚¬Âť89 Do you agree with their statement? Why or why not? If C+D did become the dominant innovation model, how would this affect its potential to create a competitive edge for a firm?
4. Introducing the C+D innovation model requires tremendous organizational change. As Huston and Sakkab described the change effort: Ă˘â‚¬Ĺ“We needed to move the companyĂ˘â‚¬â„˘s attitude from resistance to innovations Ă˘â‚¬Ëśnot invented hereĂ˘â‚¬â„˘ to enthusiasm for those Ă˘â‚¬Ëśproudly found elsewhere.Ă˘â‚¬â„˘ And we needed to change how we defined, and perceived, our R&D organizationĂ˘â‚¬â€ťfrom 7,500 people inside to 7,500 plus 1.5 million outside, with a permeable boundary between them.Ă˘â‚¬Âť90 Identify some of the major obstacles a manager would encounter attempting this kind of organizational change. For example, how might P&GĂ˘â‚¬â„˘s research employees react? Although you have not been formally introduced to organizational structure, consider some recommendations for how to accomplish such large-scale organizational change successfully.