How to Make Open Innovation Work Better? Leverage Your Competitors

Henry Chesbrough; Sea Matilda Bez

doi:10.37725/mgmt.2026.9967

Henry Chesbrough Haas School of Business, University of California Berkeley, Berkeley, CA, USA; and Luiss University, Rome, Italy
Sea Matilda Bez Montpellier Research in Management, University of Montpellier, Montpellier, France https://orcid.org/0000-0002-7747-2765

DOI: https://doi.org/10.37725/mgmt.2026.9967

Keywords: Open-Innovation, Outside-in, Behavioral syndrome, Not invented here syndrome

Abstract

Corporate open innovation initiatives involving start-ups often fail to deliver the expected results. Such failure is due in part to the behavior of individuals within corporate business units. Specifically, we examine the notion of ‘not invented here syndrome’ (NIHS), a behavioral bias that leads employees to reject external innovations, thus hindering collaboration with promising start-ups. This paper explores how corporations can overcome individuals’ NIHS, thus collaborate more effectively with external start-ups. Our research, which is based on an in-depth case study of Telefónica, confirms that NIHS can be the result of a lack of information on start-up promises, use cases, and viability. We identify a three-step organizational routine that can help mitigate NIHS in the process of evaluating external start-ups: (1) referring external start-ups to competitors, (2) monitoring competitors’ collaboration with start-ups, and (3) diffusing this additional information with the aim of shifting individuals’ decision-making by reducing their reliance on behavioral biases against external start-ups. Our findings extend the behavioral theory of the firm by demonstrating that the organizational routines implemented to offset individual biases can involve external actors rather than being limited to internal processes. We also contribute to open innovation by revealing that bringing the knowledge possessed by outside start-ups into the organization is insufficient in isolation to ensure adoption; external perspectives on those start-ups provide a second opinion to the organization that may offset internal NIHS biases.

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Author Biographies

Henry Chesbrough, Haas School of Business, University of California Berkeley, Berkeley, CA, USA; and Luiss University, Rome, Italy

Henry Chesbrough is faculty director of the Garwood Center for Corporate Innovation at the Haas School of Business, UC Berkeley, and Maire Tecnimont Professor of Open Innovation at Luiss University in Rome. Widely recognized as the ‘father of open innovation’, he introduced the concept in his landmark book Open Innovation (2003), followed by Open Business Models (2006), Open Services Innovation (2011), and Open Innovation Results (2020, Oxford University Press). His research has been published in leading journals and cited over 120,000 times on Google Scholar. Prior to his academic career, he spent a decade in the computer industry, primarily with Quantum Corporation. He holds a PhD in Business administration from UC Berkeley, an MBA from Stanford, and a BA summa cum laude from Yale.

Sea Matilda Bez, Montpellier Research in Management, University of Montpellier, Montpellier, France

Sea Matilda Bez is associate professor at Montpellier Management, University of Montpellier. Her research trajectory includes a PhD on strategizing and managing coopetition, a postdoctoral fellowship at UC Berkeley with Henry Chesbrough on open-coopetition, and participation in the steering committee of the Horizon 2020 DiHECO project on digital health platforms. She has participated in organizing several world open innovation conferences and published in international journals, including Technovation. Beyond coopetition, her research interests cover corporate-startup engagement and, more recently, patient feedback platforms in healthcare.

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