Globalisation increasingly affects how companies in OECD countries operate, compete and innovate, both at home and abroad. Global competition drastically shortens product life cycles, while the growing integration of different technologies makes innovation riskier and more costly. Companies more and more internationalise knowledge-intensive corporate functions, including R&D, and simultaneously open up their innovation process to collaborate with external partners (suppliers, customers, universities, etc.). This clearly has important implications for policy making, given the contribution of (business) innovation to economic growth. 

Globalisation increasingly affects how companies in OECD countries operate, compete and innovate, both at home and abroad. Companies now face an environment in which competition is global, in which knowledge is spread more widely, in which R&D investments are increasing and in which product life cycles are shortening. In addition, the integration of large emerging economies such as China and India has more than doubled the world’s supply of labour. To meet these new challenges, companies need to adopt new approaches to innovation processes, organisational models, finance and decision making. 

This chapter reviews the trends and drivers of open innovation and the advantages and disadvantages of greater openness. It analyses open innovation in relation to other factors, such as user-driven innovation, open source innovation, the role of lead markets, intellectual property rights, and the broader national innovation system framework. It discusses the link between globalisation and open innovation in light of the emergence of global innovation networks. Companies increasingly set up R&D facilities in other countries and initiate technology collaborations abroad to get access to knowledge in local centres of excellence. The diversity of global innovation networks, differences not only between industries but also between modes of open innovation, is also discussed. 

Chapter 2 develops new empirical indicators that help to show the importance and the evolution of open innovation across companies, industries and countries. Until now open innovation has been mainly discussed in terms of case studies, largely in hightechnology sectors. Different indicators based on R&D data, patent data, innovation surveys and data on licensing are presented.

Chapter 3 complements the “academic” analysis with insights from the 59 company case studies undertaken for this project. Their number and variety (manufacturing and services, high and low technology, MNEs and SMEs) enable an informed discussion of the diversity of open innovation in various contexts. In addition to the aggregate information drawn from the case studies, examples of how companies organise open innovation are presented. 

Chapter 4 discusses the policy implications of global and open innovation for national and regional innovation systems. The impact on different domains of innovation is discussed, with examples of how countries are responding to the changing innovation environment.