Escaping the "productization trap" - open innovation and servitization trends combined in a single thought.

Professor Henry Chesbrough is indispensable when it comes to open innovation. He is best known for his 2003 book, Open Innovation: The New Imperative for Creating And Profiting from Technology (Harvard Business Review Press, 2003). In 2006, he published two more books on open innovation, including Open Innovation: Researching a New Paradigm, Oxford University Press, with Wim Vanhaverbeke and Joel West, and Open Business Models: How to Thrive in the New Paradigm, which extends open innovation to business models: Researching a New Paradigm (Oxford University Press), co-authored with Wim Vanhaverbeke, Joel West, and Open Business Models: How to Thrive in the New (Innovation Landscape, Harvard Business Review Press). In 2011, five years later, he brings another book on "open innovation" to readers, this time thinking about open innovation in services.


Open service innovation: rethinking the survival and development of enterprises under the new situation

By Henry Chesbrough.

Lin Lei, Zhang Xiaosi Translation

Tsinghua University Press

Open Services Innovation: Rethinking Your Business to Grow and Compete in a New Era

Author: Henry Chesbrough

Publisher: Jossey-Bass

Henry Chesbrough's book, Open Service Innovation, responds to the current trend towards servitization. Now that most developed economies have entered the post-industrial era, traditional companies, such as IBM and General Electric, have discovered that services are now the most productive sector of the enterprise. While innovation in agriculture and industry has led to significant productivity gains, the services sector needs to find its own way to innovate in order to sustain growth in an economy where services represent an increasing share of the economy.


Henry Chesbrough is Professor at the Haas School of Business, University of California, Berkeley, Executive Director of the Center for Open Innovation at the Haas School of Business, and formerly Professor at Harvard Business School. He is known as the "Father of Open Innovation" for his outstanding contributions to the field of open innovation.

Henry Chesbrough begins with the "productization trap". Products are the product of an industrial economy, and with the widespread dissemination of information, inventions and technological innovations around the world, production efficiency has reached an incredible level. On one level, companies in any region can almost always develop equally good products when they have the same raw materials, tools, methods and management tools, and consumers are finding it increasingly difficult to spot the differences between the products themselves and are beginning to consider price more and more. In addition to dealing with brutal price and cost competition, product manufacturers need to keep up with the "treadmill" of product competition by introducing new and better products quickly.


In order to escape the "productization trap", manufacturers are looking to bundle services and products to showcase their uniqueness through services, while IBM and other cutting-edge companies are actively transforming from product providers to service providers. How to innovate has become one of the biggest difficulties for these companies.

With the first part of this book, Henry Chesbrough builds a conceptual framework for open service innovation.

This framework is based on four basic concepts.

 everything is at one's service

This section discusses how to think about business from the perspective of "services". The author argues that no matter whether a company is producing products or providing services, it should think beyond the usual product-led value chain and reposition its business strategy from the perspective of "services". Make "service" a powerful tool for enterprises to surpass their competitors.

 Collaborative innovation

This section focuses on the important role that customers play in the process of collaborative innovation. By working collaboratively with customers and involving them in innovation activities, it can create a better consumer experience for customers while providing a greater competitive advantage for companies.

 Open innovation

The authors point out that open innovation also plays a crucial role in the area of services. Similar to open innovation in products, innovation in services benefits from a specialized division of labour. Through "outside-in" open innovation, service firms can achieve economies of scope by leveraging external ideas, creativity and technology, while through "inside-out" open innovation, service firms can share their core business processes with other firms. Economies of scale. Of course, the most effective way to do this includes building a business platform based on an open innovation approach, building an open business platform that attracts upstream and downstream companies and partners.

 Business model innovation

Henry Chesbrough argues that by bringing these four concepts together, it is possible to show the way out of the "productization trap" and thereby maintain business growth and gain competitive advantage in the service economy by transforming business models to incorporate openness into the business model design process. .

In the second part of the book, the authors also analyze cases of open service innovation in large firms, SMEs, service firms, and emerging economies, respectively.

The most valuable part of Open Service Innovation is the first part, where the authors establish a conceptual framework for open innovation in the service sector in a consistent manner, thus expanding the concept of open innovation from the product-centric industrial sector to the service sector, which I believe will become another classic in the field of open innovation.

The value of Henry Chesbrough's post-2003 series of books on open innovation also lies in the realization that open innovation is not only related to product development, guiding firms to seek technological solutions externally, but also to The value proposition of a business is relevant and can influence a company's business model; in addition, it is closely related to services, user experience, business processes, etc. - although many companies are just starting in these areas.


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