Most research on open innovation has focused on the use of ideas and knowledge from outside the
organization in the development of products and services. But openness can be useful for process
innovation, too. The authors' research shows that manufacturers can benefit substantially when they
look for ideas beyond the factory gates, especially when their operations are already advanced.
In this article, the authors analyzed nine years of survey responses from 1,000 Swiss manufacturers,
as well as 200 interviews with personnel at the Volvo Group (AB Volvo), a manufacturer of trucks,
buses, construction equipment, and marine and industrial engines that is based in Gothenburg, Sweden.
Although the authors concede that some companies have good reasons for keeping process innovations
concealed, they found that for many manufacturers, such defensiveness deprives companies of a valuable
source of ideas for productivity improvement.
The authors present six ideas to help manufacturing companies open up their innovation process.
The first idea is to encourage factories within a large company to share innovative practices and success
stories with one another. Companies that already do this informally, the authors say, can extend
their activities with a systematic effort inside their factory networks and lay the groundwork for other
open information sharing about processes. The second idea is to focus on the pace of process
The third idea is to recognize that increased use of data access systems leads to greater production
cost reductions. Customer relationship management, supply chain management, and enterprise resource
planning software systems all require codification of tacit knowledge, which enhances a company's
capacity to spread external process ideas and technology to the people who need it.
As a fourth step, the authors recommend improving the organization's ability to absorb and
implement ideas from external sources. A good way to achieve this, they say, is to establish routines
for gathering ideas from external sources and putting them to use. Fifth, the authors advise reaching
beyond a company's internal factory networks for inspiration. Finally, they say companies should
remember that "nontraditional sources of knowledge may spark process innovation and help overcome