MIT Sloan Management Review Article on Beating ‘Not Invented Here' Syndrome

Resistance to external ideas hinders innovation. The right incentives can open minds.

When I was managing director of the German subsidiary of U.S.-headquartered SC Johnson, I witnessed “not invented here” (NIH) syndrome in action. The larger company paid scant attention to an innovative air freshener product successfully launched by an Asian subsidiary, apparently due in part to bias toward innovations originating from the United States. By chance, the Asian product came to the attention of the German subsidiary. We launched the product, now called Brise One Touch, with minor adaptations. It was a big success, taking a leadership position in the local market for that category with a 50% share and going on to do well in other markets.

NIH syndrome is a bias against ideas perceived as coming from outsiders. This bias can affect anyone in an organization. While there are rational reasons to reject some external knowledge — say, for intellectual property concerns or technical incompatibilities — this bias is often the driver, and it can be economically damaging when it leads to missed opportunities and fewer innovations. One research study surveyed 565 innovation projects from around the globe and found that only 16% of them remained entirely unaffected by NIH syndrome. This bias against outside ideas positively correlated with a reduced likelihood of project success.

About the Author

Rolf-Christian Wentz teaches at the RWTH Aachen University as a member of the Institute for Technology and Innovation Management. He also coaches and invests in startups as a business angel. For two and half decades, he worked for companies such as Procter & Gamble, SC Johnson, and Campbell Soup, serving as managing director responsible for business units during the last eight of those years.

Learn more about MIT SMR.