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Open Innovation: An HP Case Study

August 2008. Open Innovation: An HP Case Study. Mauricio Leon Hewlett Packard Consumer Desktops BU Taiwan. Agenda. Consumer Desktop PCs at HP Open/Closed Innovation Open Innovation at the Consumer Desktop GBU Challenges. HP’s Consumer Desktop PC GBU.

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Open Innovation: An HP Case Study

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  1. August 2008 Open Innovation:An HP Case Study Mauricio Leon Hewlett Packard Consumer Desktops BU Taiwan

  2. Agenda • Consumer Desktop PCs at HP • Open/Closed Innovation • Open Innovation at the Consumer Desktop GBU • Challenges

  3. HP’s Consumer Desktop PC GBU • Responsible for managing the consumer desktop category worldwide • Classical business unit organization • Headquarters in Cupertino, California

  4. Consumer Desktops -- Business Environment • Very competitive • Flat to declining market • New product categories • Geographical segmentation • Need to do more with less

  5. Closed Innovation • Ideas are internally generated • Results of innovation carried through to the markets as a product or service by the same company • Commercialized innovations generated this way drove profits and enabled further investment in R&D • Innovation model followed by most companies in first half of 20th century

  6. Open Innovation • Internal and external ideas as inputs to the innovation process, combined with internal and external paths to markets • Under Open Innovation, ideas come to the innovation process via • Internal research, external research • Licensing other companies’ technologies • Acquisition of other companies products • Conditions that supported the transition from Closed to Open • Increased availability of quality technical talent globally • Increased mobility of talent across geographies and firms • The increasing number of firms developing new products and services • Adoption is driven by R&D management or business strategy

  7. Open Innovation atHP’s Consumer Desktop GBU • Open Innovation has been a key part of the Consumer Desktop GBU’s business strategy • Our use of Open Innovation has evolved with time • Focus has evolved from R&D to global R&D management • Taipei operations • Develop new skills

  8. Business Drivers of Open Innovation • Very competitive market • Low profit margins, low R&D budgets • Complex product portfolio • Open Innovation delivers for Consumer Desktops • New ideas, new products • Lower R&D investments, manageable risks • Broader product portfolio

  9. Enablers of Open Innovation • Standards, open architectures, platforms • Design modularization • Ecosystem around platforms • Standards • Products • Companies • Information and communication technologies

  10. Challenges • Determine how to evolve the Open Innovation model as the PC market matures • Identify the need for developing owned IP • Develop the skills to execute “Closed Innovation” where needed

  11. Questions

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