From Closed to Open Innovation: The Evolving Nature of Teams and the Use of Information Technology - Information Technology and Product Development - page 125

and will remain, a fundamental organizational mechanism for driving innovation.
It is important for both researchers and practitioners alike to understand the nature
and characteristics of the product development team of today, and even more impor-
tantly, that of the team of tomorrow. By looking at the evolution of teams as we move
toward more open innovation models, and the role that information technology (IT)
plays in this evolution, we can better understand how some of the challenges of open
innovation can be met.
In this chapter, we look at the movement from closed to open innovation, a
paradigm shift that is creating new opportunities and challenges for both theory and
practice. We address crucial research issues that arise as companies increasingly
adopt more open forms of innovation.
The focus is twofold: on the product development team and on the role of IT in
supporting both teams and teamwork. While the organization itself embraces new
innovative practices, it is the team that must act upon these new philosophies and
carry them out in a tactical nature. Thus, we look to address the nature of teams and
teamwork in an open innovation context. This type of research is crucial during this
point of transition from closed to more open models of innovation, as it is likely that
standard theories of organization and teamwork may no longer apply in this new
innovation context.
The chapter is organized based on three key elements that define and shape prod-
uct development teams: team structure, team function, and team management. We
discuss each aspect as it relates to both a traditional organization in addition to one
that embraces more open forms of innovation practices. Information technology,
often the foundation in shaping each one of these elements, is addressed throughout
the chapter as it pertains to the structure, function, and management of innovation
teams. In addition, we highlight research questions within each one of these ele-
ments that offer focus and direction as we begin to further investigate this emerging
phenomenon.
7.2 Closed Innovation and the Traditional Organization
Closed innovation models are characterized by internally focused firms that generate
innovative product ideas, invest heavily in R&D, and manufacture, distribute, and
service their own innovations. Essentially, both the development and marketing of
new products take place within the boundaries of the firm. In addition to being
supported by large R&D organizations, these firms make effective use of a highly
educated and savvy workforce.
The traditional team is central to this process. While suppliers, distributors, cus-
tomers, and competitors may contribute on an as-needed basis, they take a backseat
and witness as the innovation process unfolds. As a strategy, closed innovation
firms may also use intellectual property defensively by not letting other firms
have access to extended uses and thereby miss out on potential revenue streams
(Chesbrough, 2003).
In many firms today, innovation is “still largely confined to specific, select depart-
ments, which have a monopoly on new ideas” (Tucker, 2002). While functional,