How to Appropriate Value from General-Purpose Technology by Applying Open Innovation. (May 2022)

• Record Type: Journal Article
• Authors: Yang, Jialei; Chesbrough, Henry; Hurmelinna-Laukkanen, Pia
• Is Part Of: California management review. Volume 64:Number 3(2022)
• Page Start: 24
• Page End: 48
• Publication Date: 2022-05
• Subjects: innovation management -- intellectual property -- open innovation -- patents -- general-purpose technology -- artificial intelligence -- appropriability -- appropriation; Industrial management -- Periodicals; Industrial management; Management; Bedrijfseconomie; Periodicals; 658.005
• DOI: 10.1177/00081256211041787
• Languages: English
• ISSNs: 0008-1256

Abstract

Artificial intelligence increasingly attracts attention and investments. However, appropriating value from this general-purpose technology (GPT) can be difficult. To understand these challenges, this article analyzes why IBM failed to generate significant profits from IBM Watson Health despite its promising starting points. The findings suggest that, considering the characteristics of GPT, an overly closed approach for taking it to market contributed to the failure. Furthermore, conditions such as the immaturity and the complexity of the application field intensified the challenges. This study suggests that using a strong appropriability regime in open innovation can enhance the appropriation of value from a GPT.