Closed Innovation is a model for product development where ideas are generated and refined internally, without any external input. It relies heavily on internal resources, such as research and development departments, to come up with new products or services. In this model, innovation tends to be more incremental in nature, as companies rely on their own experience and expertise to identify opportunities for improvement rather than taking risks on more radical ideas from outside sources. Closed Innovation also allows organizations to maintain control over their intellectual property rights. By keeping processes internal, companies can protect the secrecy of their innovations and maintain their competitive edge in the marketplace.
While Closed Innovation offers certain benefits, it can also lead to stagnation if not managed properly. Without access to the insights provided by external sources, companies may miss out on important trends or innovative solutions that could give them a strategic advantage in their markets. Furthermore, closed systems tend to be less adaptable when compared with open models that allow collaboration with multiple parties. As such, businesses should weigh the pros and cons of both approaches before settling on a particular approach for product development.
Related Terms: Internal Development, IP Protection, Incremental Improvement, Open Innovation