Among various forms of innovation in industry structures and business models an increasing number of companies have shown interest in aligning themselves to an open source software model as a means to capture intellectual energy, productive software processes and relevant technical skills. This is evident both within small and niche businesses, but also within the largest companies – a phenomenon known as open-sourcing. This paper presents findings from a field study of open-sourcing of software development within two large, global technology companies. It reports on the ways in which open-sourcing is accommodated within the corporate context, and assesses the innovative strategies managers use as they engage with this phenomenon and seek to work co-operatively with open source communities. The analysis focuses on three primary areas that emerge from the data and which are seen to require particular attention in such organizations; license and IPR regime; community approach; and a modified development process.