Henry Chesbrough’s “Open Innovation” was based on the idea that “not all the smart people work for you.” Simple but brilliant. 

Yet Chesbrough’s Open Innovation solution has everything to do with moving ideas and nothing to do with the movement of those smart people who create them. It deals with secondary markets in intellectual property but doesn’t seem to consider the “exchange” of individuals.
This is particularly problematic because: 
  1. Innovation is largely about the novel combination of existing ideas. Being to able to assemble a group of creative people with complementary ideas and skills is critical to innovation and entrepreneurship.
  2. The free movement of people between companies is being increasingly restricted through the use of non-compete and non-solicitation clauses in employment agreements. 
Once reserved for the highest level executives, non-compete agreements are now being used at all levels in many organizations, and law firms are ratcheting up their non-compete practices in order to help corporate clients protect their businesses (more on that here). 
Some see this trend as positive insofar as it protects companies’ IP and thus provides greater incentives to innovate (similar to the patent system). Others view the net impact as negative since the broader process of innovation is hampered in a way that damages the welfare of both society and, ultimately, individual companies.
What do you think?
Next week’s #INNOCHAT will be about the appropriate role of non-compete and non-solication clauses in promoting innovation. We’ll discuss some of the following questions:
  1. Is this a passing fad, or should we be concerned about a potential future in which creative individuals are severely restricted in their ability to contribute their ideas and skills where they would have the greatest impact?
  2. Do more restrictive employment agreements benefit society by providing greater incentives to companies to innovate? (California is decidedly anti-non-compete, as is most of Europe, while Massachusetts is perhaps the most pro-non-compete state in the US.)
  3. Do more restrictive employment agreements harm or benefit the companies who administer them?
  4. What are the implications for a country’s ability to innovate and compete globally if some are more pro- or anti-non-compete than others?
  5. How does an organization strike the right balance in its employment agreements between protecting its own IP and supporting a broader system that nurtures innovation?
Please post any additional questions or framing comments below, and join us on Twitter at 12pm EST on Feb 4th for more!  
I’m looking forward to it!

Posted via email from Human Ventures