Open Innovation- What Companies Can Learn From Open Source Communities

Posted by ownCloud GmbH – 28. October 2015

The term open innovation is quite old. Over the last few years I have heard this term more and more, and it feels a little over-hyped at the moment. But it got me thinking. How is open innovation related to what we do in open source and at ownCloud?

I think open innovation can be summarized as the idea of a company sharing information with the outside, while also listening to the feedback and suggestions from outside the company. So rather than the Gyro Gearloose model of having one or more engineers in a room ‘innovating,’ the company lets the engineers work in an open environment with others within, and outside, the company.

This is essentially how universities work, for example, and through history, opening up to a diversity of ideas and input has been clearly linked to increases in innovation, productivity and wealth. Take the Huguenots coming to the Netherlands in the 16th century, the development of ARPANET (precursor to the current internet) or recent developments in crowd sourcing in the medical world.

Here are some of the advantages of the open approach for businesses:

– It boosts innovation and development of new products.

– You get a lot more ideas than you can create internally behind closed doors (“no matter who you are, most of the smartest people work for someone else” from).

– You can evaluate this idea, do market research, discuss with existing and potential customers and users.

– It reduces the cost to develop something that doesn’t work in your target market.

Potential drawbacks are that often ‘secret’ information and IP leaves the company so that you might lose an advantage against your competitors. I’ll get to that further below as this is far less an issue than you might think. Another thing to consider is that structuring all the incoming information and moderating the discussions takes time and resources. This is a substantial cost and makes it so that open innovation does not always pay off, however, more than a loss of IP does, in my opinion.

Our Open Innovation

ownCloud is, as you know, a community driven open source project as well as being a company. So what do we do and how is this related to open innovation?

For a lot of companies introducing open innovation is a huge cultural shift. We, at ownCloud, don’t have this issue! I started ownCloud as an open source project nearly 6 years ago and in open source it is very natural that all the information is public. Otherwise, no contributors can actually understand what is going on to get involved. This is how KDE and most other open source projects I was involved with work. So when we founded ownCloud Inc. as the company that helps bigger enterprises to be successful, it was very natural for us to keep on working out in the open. Actually, we would have killed our community if we had changed that. And if you look at the latest Bitergia statistics, over 850 community contributors have contributed to ownCloud so far. So it is seems that our approach has worked.

But being open is not only good for growing a community of contributors, we also work together with a large number of partners who have helped to rollout ownCloud. In addition, we work with a bunch of partners from the research community like CERN or AARNet on innovative, forward looking features. We get direct feedback on our work from these partners in our development repositories, and they even develop tools around ownCloud which we, in turn, adopt! Obviously all of this wouldn’t work if we didn’t work in the open.

In the case of ownCloud, this open process is especially important because ownCloud is very flexible and used in a ton of different scenarios and setups. This complexity would make it incredibly hard to make the right decisions internally; about how to push the product forward, even with traditional product management. Our open development process allows for a much more direct feedback loop for customers, users, contributors, prospects and partners. Mind you, this doesn’t replace product management, as planning is important. Rather it is part of the entire process.

Practical Openness

So what exactly is public and in the open in the case of ownCloud?

* All the bugs are completely public in our github repository and visible and to everybody. This is super important because often, input from other people to reproduce a problem or get more information is essential.

* All the feature requests are also collected and visible to everyone on github. Everyone can contribute and submit a feature request. This is very valuable because we get feedback to refine the proposals and community members can start working on the idea, integrate it in other things, or take the feature in mind when developing in other areas.

* All the actual code changes are done in the form of pull requests. These pull requests are also discussed and reviewed in the open. Small implementation details can have big consequences and doing this in the open helps in getting input from many more perspectives than you’d otherwise get.

* We also make beta and RC versions of ownCloud regularly available. There are public, nightly builds available so that everyone can follow the development on a daily basis. This gives people an opportunity to give early feedback on merged features and check if problems they previously had are fixed.

* Additionally all the roadmap end development planning is also visible for everyone on Github. This makes it easier to follow development, prevents duplicate work, and gives people a place to get started or provide their input.

About Protecting Our Valuable Knowledge

An often used argument against open innovation is that you’d leak information to competitors, losing your edge. But people, it’s 2015! Technology moves so quickly, that by the time a competitor becomes aware of your great idea you’re already getting close to publishing it and they could, at best, scramble to not be too late to the game. Working in the open speeds up innovation making it easier for you to stay ahead.

Another aspect of this is that companies tend to over-estimate the value of their code. Yes, I am sure your engineers are brilliant, but so are ours. But 99% of your value isn’t in the day to day solutions for day to day problems. The value is in the big picture functionality, which is rarely, if ever, adaptable without all the engineering effort that comes with a clean implementation in a competing product. Add to that the fact that competitors tend to look far less at what you’re doing on a technical level than you might think, and in reality, there isn’t even half as much to “protect” as you would think.

The often raised concern about leakage of company’s confidential information is not a problem for us. ownCloud is open source anyway, so we don’t consider all this information secret.

Sometimes when we work with customers, they share confidential information with us that we have to make sure to protect. For this scenario we obviously store them in non-public systems. But luckily, this is only the case for customer specific topics.

Another drawback with doing everything in the open is that the moderation, evaluating, and processing of all the information takes some time and resources. But I think it is totally worth the effort if you look at the end results.

So, I think that most open source projects follow an open innovation approach even if they don’t call it that. This has a ton of benefits, and I recommend that a lot more companies take this as an example on how successful product development is done in the future.

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