The literature on open strategy tends to emphasize the commonalities it shares with open innovation. This is not surprising given that open strategy and open innovation are often portrayed as overlapping concepts and open strategy as a variant of open innovation (Chesbrough and Appleyard 2007) or vice versa (Whittington et al. 2011). Notwithstanding the commonalities we identified on a more general level, a closer analysis of the empirical cases of open strategy and open innovation also reveals some significant differences. In the following, we present the results of our analysis of similarities and differences between the domains of open strategy and open innovation. In order to do so, we reviewed the empirical literature on open innovation and open strategy. While the former literature is massive (Dahlander and Gann 2010), the latter is still comparatively small. To date, there are twenty empirical studies on open strategy, some of which are still part of the “grey literature”, i. e. working papers or conference papers (see Table 1 for an overview of all existing empirical studies). Given the novelty of the phenomenon of open strategy and the comparatively small number of empirical papers, we have examined each of the twenty papers very closely, while we relied partly on existing reviews (Dahlander and Gann 2010; Huizingh 2011; Lichtenthaler 2011; West and Bogers 2014) in our examination of the vast literature on open innovation. We analyzed the two literatures on the basis of our framework, examining the openness of open innovation and open strategy in terms of sociality, factuality and temporality as well as with respect to the question of how this openness is accomplished effectively.
The social dimension of openness in innovation and strategy processes
The social dimension of openness in innovation and strategy processes refers us to the groups that are treated as relevant participants to the communication process. Looking at the studies on open innovation, it is apparent that open innovation is almost always about opening up to external actors. For example, firms may share information with members of external innovation communities (Fichter 2009), acquire technology from other companies (Fey and Birkinshaw 2005; Laursen and Salter 2006) or reveal the source code of their own products to external audiences (Henkel 2006; Henkel et al. 2014). Open innovation may even include discussing internal problems with an external audience while excluding select organizational members from participating, in order to avoid the phenomenon of “groupthink” (Bonabeau 2009; Surowiecki 2004).
With respect to the means of accomplishing and sustaining this kind of openness in innovation processes, the respective literature reports on two general types of tools. First, several studies report on the use of tools that strive to establish a collaborative climate among participants in order to develop innovations (see Fichter 2009; Rohrbeck et al. 2009). The second type of tools reported on in the analyzed literature takes a much more competitive approach. There, the innovation process is opened up to external groups by means of some sort of innovation contest that follows a winner-takes-all-logic (see Füller et al. 2011; Piller and Walcher 2006). Afuah and Tucci (2012) termed the first form “collaboration-based crowdsourcing” and the second form “tournament-based crowdsourcing”.
For open strategy processes we find that, in contrast to open innovation, these processes are much more often about opening up to internal groups. Stieger et al., for example, emphasized that involving many employees in the strategy process is “a means [of creating] shared understanding, stronger commitment, and effective implementation” (Stieger et al. 2012, p. 46). The authors pointed out the role of two-way communication between management and employees: “the combination of listening and talking should lead to a dialogue, which creates new knowledge and [allows] shared understanding to emerge in the organization” (Stieger et al. 2012, p. 60). Also in the cases investigated by Baptista et al. (2017), Luedicke et al. (2017) and Mack and Szulanski (2017) the main target groups for open strategy processes are members of the organization. Only rarely are large groups of external actors invited to participate in open strategy-making, as was the case of Wikimedia (Dobusch and Müller-Seitz 2012; Heracleous et al. 2017), where a non-profit organization invited not only its large community of volunteers but also the wider public to contribute to a one-year strategy-making process (for another such study see Malhotra et al. 2017).
Reflecting the different challenges of opening up to (mostly) external groups in open innovation, the tools used in open strategy to accomplish and sustain the openness to internal groups put much more emphasis on joint sensemaking. Hence, only tools that help in establishing collaborative forms of engagement are used. An example is the “strategy dialogue” reported on in the study of Stieger et al. which is aimed at creating “identification and understanding” (Stieger et al. 2012, p. 46) between the participants. In a similar vein, the study by Dobusch and Müller-Seitz highlights the “collaborative exchange” that is part of “collaborative strategizing where both parties interact” (Dobusch and Müller-Seitz 2012, p. 5). Especially the studies on open strategy that focus solely on joint sensemaking, such as the works by Baptista et al. (2017), De Gooyert et al. (2014), Hardy et al. (2006), Werle and Seidl (2012, 2015) as well as, Schmitt (2010), have shown that open strategy is performed by those who participate in meetings and workshop processes.
Taken together, we find that the means and ends of establishing and maintaining openness in the social dimension differ clearly between open strategy and open innovation. While open innovation typically strives to open up to external audiences by means of either collaboration or competition-based tools, open strategy more often strives to open up to internal audiences and stakeholders by means of tools that focus on collaborative forms of engagement.
The fact dimension of openness in innovation and strategy processes
The fact dimension of openness refers us to the range of topics allowing for follow-up communication within the respective innovation or strategy process. In the case of open innovation, openness is mostly about technological and product-related knowledge. Chesbrough (2006) has pointed out that many existing works, including those by Nelson and Winter (1982), Cohen and Levinthal (1990) and Rosenberg (1994), have already emphasized the importance of external sources of useful knowledge for internal R&D (see also Trott and Hartmann 2009). Especially for open innovation, factual openness to other innovation processes also plays an important role. With regards to knowledge-sharing, open innovation implies that what was previously considered a “knowledge spillover” in fact concerns “purposive outbound flows of knowledge and technology” (Chesbrough 2006, p. 11).
A focal topic in the literature on open innovation are the means to establish and sustain this factual openness throughout the process. The exemplary studies included in our analysis show that organizations strive to increase the receptiveness and connectivity of their innovation processes to a wide range of topics via such measures as partnering and contracting (Chesbrough and Crowther 2006; Christensen et al. 2005; Fey and Birkinshaw 2005; Laursen and Salter 2006), sharing the source code of the programs they develop (Henkel 2006; Henkel et al. 2014; West 2003), collaborating informally with innovation communities (Fichter 2009), discussing strategic innovations in workshops that involve several companies and industries (Rohrbeck et al. 2009), collecting ideas via online crowdsourcing platforms (Füller et al. 2013; Piller and Walcher 2006), engaging in the commercialization of external technology by out-licensing agreements, striking alliances, generating spin-offs and promoting sales in the area of technology (Lichtenthaler and Ernst 2007).
Of specific importance for the effective accomplishment of factual openness in innovation processes is the management of intellectual property rights. The means discussed in the literature include specific licensing practices (Chesbrough 2006; Dahlander and Gann 2010), “free revealing” (Henkel et al. 2014; von Hippel and von Krogh 2003), alternative licensing, licensing open-source software or explicitly avoiding patentability (Baldwin and von Hippel 2011; Merges 2004). They all rely on the formalized appropriation of communicated content.
Of similar importance to open innovation are tools to crowdsource solutions to a problem. “Broadcast search”, for example is a type of crowdsourcing that involves broadcasting to a wide audience a problem and the requirements that an appropriate solution must fulfil, in the hope that some member of that audience will provide a solution (Jeppeson and Lakhani 2010). A related tool involves sourcing ideas through contests (Afuah and Tucci 2012). The degree of openness on the fact dimension that can be accomplished by such online-tools will of course largely depend on the features of the specific online platform that is used, such as access to intermediate results, discussion boards or evaluation systems. In addition to online communication tools, the literature also points to a range of offline practices such as “innovation jams” (Bjelland and Wood 2008).
In the case of open strategy, the range of “connective” topics is not limited to defined and relatively unequivocal knowledge regarding technologies and products. Instead, and in contrast to most open innovation processes, it also includes opinions, ideas and interpretations on a wide variety of social issues. This reflects the fact that the primary focus of open strategy is joint sensemaking. Those who participate in open strategy may provide primary ideas and interpretations as well as opinions on or interpretations of what others think, say and do (Hutter et al. 2017; Luedicke et al. 2017; Mack and Szulanski 2017; Malhotra et al. 2017; Turco 2016). For example, in their study on strategy crowdsourcing, Stieger et al. emphasized the “diversity of opinions” (Stieger et al. 2012, p. 51) that were exchanged in this way. In yet another example, Teulier and Rouleau noted that the process of participating in open strategy revealed how “the interpretations […] differed” (Teulier and Rouleau 2014, p. 323) and how the process of participation as such helped “alleviate the divergent interpretations” (Teulier and Rouleau 2014, p. 323). Others point to the relevance of position-specific perspectives on strategic problems (Baptista et al. 2017) or the greater variety of ideas more generally (Malhotra et al. 2017; Turco 2016).
Regardless of the increased openness that open strategy processes exhibit on the fact dimension of meaning, the tools used in the effective accomplishment of that openness seem to be quite similar to those used in open innovation processes. Stieger et al. (2012), for example, described how the company they studied used web-based crowdsourcing tools for the purpose of open strategizing, which were similar to the crowdsourcing tools used in open innovation (see also Hutter et al. 2017). In the context of open strategy, tools such as strategy platforms (Stieger et al. 2012), wikis (Dobusch and Müller-Seitz 2012; Heracleous et al. 2017), blogs (Gegenhuber and Dobusch 2017), social media (Neely and Leonardi 2017) or online games (Aten and Thomas 2016) are used to crowdsource strategic suggestions. Just like in open innovation processes, we also find studies on the use of offline tools such as meetings and workshops (see, for instance, Turco 2016). In contrast to open innovation, however, the offline tools are typically conceived of as an indispensable element of – and not just as a possible supplement to – open strategy processes (e. g. Stieger et al. 2012; Dobusch and Müller-Seitz 2012).
Taken together, we find some indication that compared to open strategy processes, open innovation processes in general seem to be less open with regards to the fact dimension of meaning. More specifically, most open innovation processes will be connective only to rather unambiguous topics such as defined knowledge regarding technologies and products. Open strategy processes on the other hand, will also be open to much more polysemous topics, that is, topics which can be interpreted very differently. The means to effectively accomplish this kind of openness reflect this difference insofar as open innovation often focusses on the use of online-tools, while studies on open strategy processes highlight that offline-tools involving face-to-face interaction will be an indispensable element in most open strategy processes. In turn, unrestricted use of online tools may lead to substantial distractions, as was documented by the analysis of social media use by Neely and Leonardi (2017), who found that non-work related content shared via these tools can become a source of tension for enacting strategy.
The temporal dimension of openness in innovation and strategy processes
The temporal dimension of openness in innovation and strategy processes refers us to openness with regards to the variety of interpretations of the past (e. g., founding myths and historical backgrounds of current strategies) and the future (e. g., strategic plans and visions), and, hence, point us to the different purposes that are typically accepted as a basis for communication. Studies on open innovation have revealed three main purposes of such processes: First, many studies refer to advantages in R&D as a reason for opening up. For example, Laursen and Salter (2006) argued that openness is a way “to draw in ideas from outsiders to deepen the pool of technological opportunities”. Second, many organizations highlight standardization and ecosystem development (separately or in addition to the benefits gained in the domain of R&D) as reasons for opening up. In particular, they point to the marketing benefits that can be generated by increasing “the extent and pace of diffusion of that innovation relative to what it would be if the innovation were either licensed at a fee or held secret” (von Hippel and von Krogh 2003, p. 301). Studies on open-source software in particular emphasize that openness ensures that a product remains “compatible to other products” (Henkel 2006, p. 961) and helps products succeed in “standard contests” (West 2003, p. 1279). Third, some studies refer to impression management in this regard. For example, according to Henkel (2006, p. 961), wanting to “appear as a good player in the open source community” is one of the most important motives for revealing software code (aside from the legal requirements that are associated with open source licenses).
To sum up, it can be said that the rather clear-cut focus of open innovation on products and related engineering problems tends to be associated with moderate levels of openness in the temporal dimension of meaning. In line with this insight, studies on open innovation do not report on specific tools that would enable an organization to deal with radically new visions of the company’s future or help in integrating competences that differ substantially from the established set of competencies and values acquired through past experiences.
In contrast to open innovation, open strategy processes are often confronted with “wicked issues” that call for “less controlled, open and sense-making oriented strategizing with stakeholders” (Schmitt 2010, p. 11). Apart from one (Yakis-Douglas et al. 2017), all twenty empirical studies on open strategy emphasize the central role of joint sensemaking, where strategy-related communication allows for the emergence of a wider scope or a greater depth of issues being addressed in strategy-making. Schmitt (2010), for example, described a process of collaborative strategy-making at a multinational company posited that its purpose is to create and co-construct “shared understanding” (Schmitt 2010, p. 14) among stakeholders in the face of radically new challenges. Another example are the studies by Werle and Seidl (2012, 2015) which described two cases in which groups of organizations engaged in the joint exploration of strategic topics that they had not been able to make sense of on their own. Baptista and colleagues (2017), in turn, even introduce the capability of “reflexiveness” in sensemaking as both precondition for and outcome of greater openness in strategy-making. Finally, in a case of “radical openness” analyzed by Luedicke et al. (2017, p. 12), open strategizing resulted “in a continuous rejuvenation of a collective identity” while, at the same time, endowing “the organization with a particularly strong sense of moral purpose.”
Given the central importance of openness to a wide variety of purposes in strategy processes, the studies on open strategy also report on a number of approaches to accomplish this kind of openness. The reported tools almost always focus on some form of intensive real-time interactions within well-defined groups (Turco 2016). Werle and Seidl (2012, 2015), for example, show how the exchange between participants of different organizations gave rise to new understandings of strategic issues that none of the participants would have been able to develop on their own. Similarly, Hardy et al. analyzed collaborative strategy-making that concerned meta-problems and showed that such practices helped construct “shared meanings and understandings” (Hardy et al. 2006, p. 108). In the case of radically open strategizing investigated by Luedicke et al. (2017), the organization relied on intensive mailing-list discussions and occasional Skype conferences. De Gooyert et al. (2014) described how an individual organization involved its internal and external stakeholders in the joint exploration of strategic developments and trends. Wolf et al. (2014) and Teulier and Rouleau (2014) also examined open strategy-making, focusing on sensemaking within different group-formations. Aten and Thomas (2016, p. 6), in turn, present the case of a “highly bureaucratized organization” – the U.S. Navy –, where officials turned to crowdsourcing technology in an attempt “to find new and innovative strategies”; the format of the strategizing initiative was a specifically designed online gaming environment, which provided participants with strategically relevant information on “everything from marketing to training and preparation, to subject matter analyzing, to security and PAO, and contracts, and union legalities and negotiations” (Aten and Thomas 2016, p. 14).
Taken together, we find that there are marked differences between open innovation and open strategy processes with respect to their openness on the temporal dimension of meaning. Open innovation processes do generally not require the participating actors to integrate radically new visions and values and be open to radically new competence-sets. The opposite seems to be true for open strategy processes which, in most cases, are opened up in order to deal with radically new developments in the organizations’ internal and external environment. Consequently, effective open strategy processes make use of communication tools that enable the participants – mostly via some form of real-time interaction within a well-defined group – to make sense of uncertain developments and emergent trends.