V06 Exploration and expliotation across firms boundaries

• Definiton
  • A spinout is a type of corporate action where a company splits off a section as a seperate business
  • It is a mechanism for dealing with inventions that do not fit the parent organisazion'score strategy
• Advantage
  • Spinouts have the opportunity to desocialize from parent organization (desocialisation and exploration)
  • Parent organization stys with its core focus and traditional business, while spinout can exploit market opportunities and keep growing

Move 1: Become a customer or supplier of your former internal project.

If: Your business is pursuing an important capability that it can not afford to develop itself or not acquire on the market. And others in the industry also covet (begehren) this capability.

Then: Join whith those others to fund, develop and launch an indiependent business to gain this capability.

Example: Philipps engaged in a joint venture (Gemeinschaftsunternehmen) with ASM to launch the new product Philips Automatic Stepper which was sold to Philips. 

• Definition
  • Process where members of an organization grows more alike and develops something like an organizational code (reduced diversity and individual beliefs)
  • It hinders the learning process and decreases the efficiency of organizational learning of the members but at the same time it is good for the individual performance
• Mechanism
  • 1. Experiance with a technology
  • 2. Greater competence (compared to other technologies)
  • 3. Increased use
  • 4. Increased experiance

Move 2: Let others develop your nonstrategic initiatives.

If: Your business is refocusing on its core activities and you've identified adjacent, complementary initiatives that drain too much attention, time, and capital but that attract outside interest and investment.

Then: Spin them out to investors. Keep some Equity (Eigenkapital) so you can reaquire the spin of in case of success.

Example: Shapeways as a spin-out of Philipps which prints anything people want. The idea came from Philips Dessign but required to much time and investment for new 3D printers. 

• Turnover: Introduces less socialized people into the firm
• Mobility: Implements interfirm knowledge flow
• Open innovatoin: Helps organizations to maintain and enhance conections to external environment
• New esternal simuli: Can modify and update organizational code
• Spinouts: Organizational members gain a new context (more effective than mobility)

Move 3: Make your IP (intellectual property) work harder for you and others

If: a lot of your companys intellectual property sits on a shelf and generates no financial benefit but you recognize that they have value on the market. 

Then: Sell the intellectual property (patent) with licensing fees to your partners.

Example: Patent from Philipps "User interface system based on pointing device" which succesfully used to sue Nintendo for Wii

Move 4: Grow your ecosystem, even when you are not growing

If: Your company is an active innovator & collaborates with customers, industy, trade associations to identify future opportunities.

Then: Build on your ecosystem of potential innovation partners. (Check out who is interested in which innovation for what price!)

Example: Philips as light bulb producer developed ecosystem around smart lightning -> new products like smart light switches and ondooor positioning systems and services

Move 6: Create open domains to reduce costs and expand participation

If: Internal Ideas are likely to attract interests from valuable outside communities.

Then: Establish open domains that either exchange information and ideas or provide shared facilities and services. 

Example: Philips turned its R&D facility in the Netherlands into an open campus leads to knowledge sharing.

• A spin-out increases the extent of exploration by inventors who join it
• A spinout decreases the extent to which inventors who join it rely on the company’s knowledge in their inventive activities.
• The positive effect of spinouts on inventors’ extent of exploration is stronger for highly socialized than for less socialized inventors.
  • "The older the inventor, the more innovative he/she becomes."
• The negative effect of spinouts on the extent to which inventors rely on the parent company’s knowledge is stronger for highly socialized than for less socialized inventors.
  • "The longer in the parent company, the more you look for alternative sources of knowledge."

• Motivation: people know they have an exit strategy
• Informal knowledge transfer: the parent company access new relevant knowledge
• Formal knowledge transfer and buy back closes
• Assessment of market readiness to new technologies

• Very close contacts to market and clients
• Very open to every industry (food, medicine, digital)
• Strategy: Becoming a full solution provider with maintanance service and education of employees allowed to get informations about valuable new solutions and new innovative opportunities.

View of IMRA

• Strategy: They wanted to stay in the automotive sector

View of Michel

• Hirarchical organisational Structure led to unefficiency, lot of bureaucraty, less explorative freedom (New internal processes are simple and transparent) 
• New team no one fro IMRA