Outsourcing innovation: strategic perspective of opportunities and challenges

Abstract

The changes in the innovation landscape and growing importance of outsourcing in the ever connected world led us to the study of innovation outsourcing. We sought to understand the underlying reasons why companies outsource and the benefits they accrue from the process. With outsourced vendors moving up the value chain rapidly we thought that it would be interesting to study their moves in the innovation realm. With this motive we set out by understanding the current innovation practices at companies and carried an in-depth study of those who have innovative models of dealing with the challenges posed. We also interacted with management at various organizations that are involved in the innovation outsourcing process and collected valuable data about their outsourcing practices. We synthesized the information so collected and came up with parameters to apply when companies go in for different models for outsourcing innovation. We conclude the paper with specific recommendations and a checklist that can be used for considering various alternatives for outsourcing innovation.