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As the aviation industry continues to grow rapidly with improved technology, Open Innovation becomes increasingly critical to its success. Embraer, a leading aircraft company based in Brazil attended Berkeley Haas for a one-day seminar on Open Innovation to gain insight into disrupting their current business model. In Brazil, Embraer is one of the largest manufacturers of corporate, commercial and defense aircraft; and one of the country’s three largest exporters, especially to the overseas market with nearly 4,730 million dollar in revenue in 2006.
The firm’s vision is to continue making aircraft models that are “just right”—they found that most aircrafts were either too big or too small, thus their new series had “right sized” capacity to optimize carrier profitability. Today, Embraer looks for innovation opportunities and turns to Open Innovation to seek a new business model for expansion.
In 2009 their competitor Bombardier implemented Open Innovation and re-designed their vision for modern transportation. For Bombradier, this resulted in the next generation of transportation, which in recent years was adapted to a larger scale.
The value of co-creating and end-user experience is a natural deliverable of Open Innovation. Since its inception in 1969, Embraer continues to be a legacy company with several success stories. They hope to make Open Innovation their own business model to capture value for their services. What’s next for Embraer? Will their Open Innovation practice impact the aviation industry as whole?