Nevertheless , it remains difficult to determine the value of a joint research project in advance , given the unpredictability of results . Timing plays an important role here , too , since an invention that is patented just one day earlier by a competitor can render one ' s own research entirely worthless . On the other hand it is possible to estimate the effort it would take to find and hire and motivate people with the same knowledge and experience as are made available by the partner .
Technology Licensing
In 2003 Henri Chesbrough introduced the concept of „ open innovation ‟ in his book „ Open innovation , the new imperative for creating and profiting from technology ‟ 26 . Chesbrough builds on what is known as the „ funnel ‟ model , in which companies start with a large amount of ideas of which just a small selection is elaborated , and an even smaller portion ultimately reaches the market ( Figure 22 ). The ideas that are not elaborated into a product remain unused , and are sometimes even inaccessible to others because they are patented .
Idea
Product development
Market introduction
Products are commercially unsuccessful Products are technically too complex
Ideas are discarded
Figure 22 . Usual ' funnel ' for product development
Market
Chesbrough ' s proposal is that companies sell their unused knowledge to other companies , thereby generating extra income ( Figure 22 ). They can also elaborate the ideas in new start-ups . Conversely , they can buy technologies and patents from other companies in order to achieve a shorter time-tomarket for their own new products .
Ideaselection
Ideaselection
Product development
Ideas / technology from outside
Market introduction purchasing knowledge Idea
Products / concepts from outside
Products are ommericially unsuccessful Products are technically too complex
Ideas are discarded Selling unused knowledge
Figure 22 . ' Funnel ' for product development according to Chesbrough ' s concept of open innovation
Market
In most cases , technology and intellectual property rights are acquired through licensing . In this form of alliance , you benefit from the knowledge , competences , technologies and perhaps patents of another party , or instead you make such knowledge available . Chapter 5 takes a closer look at the settlement .
The Galapagos bio-technology firm is a typical example of open innovation . The company develops biotechnology for new medicines , but is too small to process that technology into medicine and to embark on the costly process of getting the medicine approved through clinical testing in the US and Europe . So instead they sell patents and procedures to partners such as Astra Zeneca , Eli Lilly and Janssen Pharmaceuticals . Galapagos is generally remunerated directly , and subsequently shares in the profits if a medicine makes it to the market .
The price payable for a certain technology will depend to a large extent on its direct applicability ,
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