Free OpenIDEO Case Study Solution | Assignment Help

MBA Staff Writer
Written by Gary F. Smith
Publish Date: 2024-12-01

Harvard Case - OpenIDEO

"OpenIDEO" Harvard business case study is written by Karim R. Lakhani, Anne-Laure Fayard, Natalia Levina, Stephanie Healy Pokrywa. It deals with the challenges in the field of Social Enterprise. The case study is 29 page(s) long and it was first published on : Feb 24, 2012

At Fern Fort University, we recommend OpenIDEO adopt a hybrid organizational structure, leveraging the strengths of both for-profit and non-profit models to achieve sustainable growth and maximize social impact. This approach will allow OpenIDEO to attract and retain top talent, secure diverse funding sources, and scale its operations effectively while remaining true to its mission of driving positive social change through design.

2. Background

OpenIDEO is a non-profit organization dedicated to harnessing the power of design thinking to address global challenges. Founded in 2008, OpenIDEO has gained recognition for its innovative approach to problem-solving, engaging a global community of designers, innovators, and changemakers in collaborative challenges. The case study explores OpenIDEO's journey, highlighting its successes and challenges in achieving its mission.

The main protagonists of the case study are:

  • OpenIDEO's leadership team: Facing the challenge of balancing financial sustainability with its social mission.
  • OpenIDEO's community of designers and innovators: Contributing their skills and expertise to solve global challenges.
  • OpenIDEO's funders: Supporting the organization's mission and seeking a return on their investment.

3. Analysis of the Case Study

This case study can be analyzed through the lens of Social Entrepreneurship and Hybrid Organizational Structures.

Social Entrepreneurship: OpenIDEO exemplifies a social enterprise with a strong commitment to social innovation and impact investing. Their approach aligns with the principles of triple bottom line, aiming to achieve positive social, environmental, and economic outcomes.

Hybrid Organizational Structures: OpenIDEO's current non-profit structure faces limitations in attracting and retaining top talent, securing diverse funding sources, and scaling operations. A hybrid structure, incorporating elements of both for-profit and non-profit models, can address these challenges.

Framework for Analysis:

  • Mission and Values: OpenIDEO's mission is deeply rooted in social impact and design thinking.
  • Business Model: OpenIDEO's model relies on a combination of grants, sponsorships, and fee-based services.
  • Financial Sustainability: OpenIDEO faces challenges in securing sustainable funding to support its growth.
  • Social Impact: OpenIDEO's impact is measured through the adoption of solutions developed through its challenges.
  • Organizational Structure: OpenIDEO's current non-profit structure limits its ability to attract and retain talent and secure diverse funding.
  • Governance: OpenIDEO's governance structure needs to adapt to the evolving needs of a growing organization.

4. Recommendations

To address the challenges and capitalize on opportunities, OpenIDEO should adopt a hybrid organizational structure. This structure would combine the social mission and impact focus of a non-profit with the financial flexibility and growth potential of a for-profit entity.

Here's a breakdown of the recommended approach:

  1. Establish a for-profit subsidiary: This subsidiary would focus on developing and delivering commercial products and services derived from the successful solutions generated through OpenIDEO's challenges. This subsidiary would generate revenue and provide a sustainable funding stream for OpenIDEO's non-profit activities.
  2. Develop a blended value model: This model would ensure that both social impact and financial returns are prioritized. The for-profit subsidiary would be structured to reinvest a portion of its profits back into OpenIDEO's non-profit activities, further strengthening the organization's social impact.
  3. Implement a dual governance structure: A separate board of directors would oversee the for-profit subsidiary, ensuring its financial viability and market competitiveness. The non-profit board would continue to oversee OpenIDEO's mission and social impact activities.
  4. Leverage impact investing: OpenIDEO should actively seek impact investors who are interested in supporting organizations with a strong social mission and a clear path to financial sustainability. This would provide access to a broader range of funding sources and attract investors who value both social and financial returns.
  5. Develop a robust social impact measurement framework: OpenIDEO should invest in developing a comprehensive framework to measure the social impact of its initiatives. This will allow OpenIDEO to demonstrate the value of its work to funders, stakeholders, and the broader community.

5. Basis of Recommendations

These recommendations are based on the following considerations:

  1. Core competencies and consistency with mission: The hybrid structure aligns with OpenIDEO's mission by leveraging its design thinking expertise to create both social and commercial value.
  2. External customers and internal clients: The for-profit subsidiary would cater to external customers seeking innovative solutions, while the non-profit would continue to serve its community of designers and innovators.
  3. Competitors: A hybrid structure would allow OpenIDEO to compete effectively with both traditional non-profits and for-profit businesses, offering a unique value proposition.
  4. Attractiveness ' quantitative measures: The for-profit subsidiary would generate revenue, providing a sustainable funding source for OpenIDEO's non-profit activities. This would improve the organization's financial stability and attract investors seeking both social and financial returns.
  5. Assumptions: The success of this approach depends on the ability to develop commercially viable products and services from the solutions generated through OpenIDEO's challenges.

6. Conclusion

By embracing a hybrid organizational structure, OpenIDEO can unlock its full potential for growth and social impact. This approach will allow OpenIDEO to attract and retain top talent, secure diverse funding sources, and scale its operations effectively while remaining true to its mission of driving positive social change through design.

7. Discussion

Alternatives not selected:

  • Remaining solely a non-profit: This would limit OpenIDEO's ability to scale and attract diverse funding sources.
  • Becoming a fully for-profit organization: This would potentially compromise OpenIDEO's social mission and alienate some stakeholders.

Risks and key assumptions:

  • Risk of losing focus on social impact: The for-profit subsidiary needs to be carefully managed to ensure that its commercial activities do not overshadow OpenIDEO's social mission.
  • Assumption of commercial viability: The success of the hybrid model depends on the ability to develop commercially viable products and services from OpenIDEO's challenges.

8. Next Steps

  1. Develop a detailed business plan for the for-profit subsidiary: This plan should outline the proposed products and services, target market, revenue model, and financial projections.
  2. Secure funding for the for-profit subsidiary: OpenIDEO should actively seek impact investors and explore other funding options.
  3. Establish the for-profit subsidiary and recruit a dedicated leadership team: This team should have experience in both social enterprise and commercial business development.
  4. Develop a robust social impact measurement framework: This will allow OpenIDEO to track and demonstrate the impact of its initiatives.
  5. Communicate the new structure to stakeholders: OpenIDEO should clearly communicate the rationale for the hybrid model and its potential benefits to funders, partners, and the broader community.

By taking these steps, OpenIDEO can position itself for long-term success, achieving both financial sustainability and a lasting positive impact on the world.

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Case Description

The case describes OpenIDEO, an online offshoot of IDEO, one of the world's leading product design firms. OpenIDEO leverages IDEO's innovative design process and an online community to create solutions for social issues. Emphasis is placed on comparing the IDEO and OpenlDEO processes using real-world project examples. For IDEO this includes the redesign of Air New Zealand's long haul flights. For OpenIDEO this includes increasing bone marrow donor registrations and improving personal sanitation in Ghana. In addition, the importance of fostering a collaborative online environment is explored.

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