A Capability-Based Framework for Open Innovation: Complementing Absorptive Capacity

We merge research into knowledge management, absorptive capacity, and dynamic capabilities to arrive at an integrative perspective, which considers knowledge exploration, retention, and exploitation inside and outside a firm's boundaries. By complementing the concept of absorptive capacity, we advance towards a capability-based framework for open innovation processes. We identify the following six 'knowledge capacities' as a firm's critical capabilities of managing internal and external knowledge in open innovation processes: inventive, absorptive, transformative, connective, innovative, and desorptive capacity. 'Knowledge management capacity' is a dynamic capability, which reconfigures and realigns the knowledge capacities. It refers to a firm's ability to successfully manage its knowledge base over time. The concept may be regarded as a framework for open innovation, as a complement to absorptive capacity, and as a move towards understanding dynamic capabilities for managing knowledge. On this basis, it contributes to explaining interfirm heterogeneity in knowledge and alliance strategies, organizational boundaries, and innovation performance.     

Environmental management capabilities for a “circular eco‐innovation”

At a micro level, eco‐innovation marks a transition towards a circular economy (CE), and standardised routines and controls are being implemented by businesses to introduce eco‐innovative processes and thus a circular business model. Eco‐innovation applied to a circular model implies changes to companies' environmental management and accounting practices used to manage natural resources. In this context, this study analyses and measures formal and informal environmental management systems, such as certification standards and other management and environmental accounting procedures used in eco‐innovation and the CE within the dynamic capabilities theoretical framework. The study also investigates the cause‐and‐effect relationship between firms' “circular eco‐innovation” and environmental capabilities using partial least squares structural equation modelling and tests it using a sample of Spanish companies. This study offers new knowledge about the interposition of business eco‐innovation and CE‐related activities introduced by firms from the dynamic capabilities perspective.     

Green Product Innovation in Manufacturing Firms: A Sustainability‐Oriented Dynamic Capability Perspective

Despite environmental sustainability being identified as one of the key drivers of innovation, extant literature lacks a theoretically sound and empirically testable framework that can provide specific insights into green product innovation from a capability perspective. This study develops a theoretical framework from a sustainability‐oriented dynamic capability (SODC) perspective. We conceive SODCs as consisting of three underlying processes (external resource integration, internal resource integration, and resource building and reconfiguration) that influence the change/renewal of sustainability‐oriented ordinary capabilities (SOOCs) (green innovation capability and eco‐design capability). This study answers two key questions: which SODCs are needed to develop green innovation and eco‐design capabilities? Which of these capabilities lead to better market performance of green products? We test a structural model linking SODCs to market performance in 189 Italian manufacturing firms. First, we find that the nature of the SODC–performance link (direct or indirect) depends on the SODC type. Specifically, resource building and reconfiguration is the only SODC with a direct effect on market performance. Second, all three types of SODC affect the eco‐design capability, which mediates the link between SODCs and market performance. Third, we find that external resource integration is the only SODC affecting the green innovation capability, which mediates the link between external resource integration and market performance. Resource building and reconfiguration is the SODC with the overall (direct and indirect) highest impact on market performance. This study, among the first to consider capabilities for green product innovation under a dynamic capability perspective, provides implications for scholars, managers and policy makers. Copyright © 2016 John Wiley & Sons, Ltd and ERP Environment     

Purchasing orchestration practices – Introducing a purchasing-innovation framework

This research investigates the purchasing role in enhancing an organization's innovation performance. Taking a purchasing perspective, this research introduces a new purchasing-innovation framework and specific purchasing orchestration (PO) practices related to the acquisition, integration, re-configuration, and commercialization of critical resources to enhance innovation performance. A theory elaboration methodology is applied to broaden the scope of resource orchestration theory (ROT) and introduce PO practices as an essential enabler of innovation. Qualitative interviews with managers from different industries enrich the theory elaboration process. This research contributes to theory by developing the concept of PO and enhancing the theoretical understanding of its meaning. Based on theory and empirical data, this research elucidates the PO practices of resource structuring, bundling, and leveraging support. The purchasing innovation framework explains how open-mindedness and technological uncertainty influence purchasing orchestration practices and innovation performance. Purchasing managers benefit from this research by learning to identify and address potential PO capability gaps and take a holistic perspective on resource management, looking both upstream and downstream in the supply chain.     

Recombination in digital innovation: Challenges,opportunities, and the importance of a theoretical framework

In this article I argue that the quest to establish digital innovation as a research domain is hindered by three challenges. As digital innovation research we are too often: a) reifying the agency of digital innovation actors; b) developing explanations of digital innovation detached from the specifics of digital technology, and c) developing overly specific explanations of digital innovation. I begin by providing a brief overview of the recombination perspective and considering why this perspective holds great appeal in the digital age. I then engage with Henfridsson et al.'s (2018) value spaces framework as a platform for framing value creation and value capture in relation to recombination in digital innovation. Next, I push Henfridsson et al.'s arguments one step further to discuss them in relation to what I consider to be the key challenges for digital innovation research. Illustrating with some of my own recent projects, I suggest that in order to fully address these challenges we need to (1) develop explanations of digital innovation acknowledging the complexity of sociomaterial interaction in digital innovation; (2) develop explanations of digital innovation building on the specifics of digital technology, and (3) develop explanations of digital innovation based on an oscillation between the specific and the general. The article concludes by pointing to future challenges and developments for digital innovation research.     

Innovation ecosystems as a service: Exploring the dynamics between corporates & start-ups in the context of a corporate coworking space

The desire to create innovative organizational spaces has led to various instantiations of innovation ecosystems. Towards this direction, there is a growing interest in establishing corporate innovation ecosystems in the form of ‘corporate coworking spaces’ (CWS). From a relational ontological standpoint, this study builds on the collaborative spaces literature with the aim to investigate the emerging dynamics between corporates and start-ups in an innovation ecosystem. Through an abductive research strategy (ARS) as well as service design methods, we explore how co-creation between corporates and start-ups emerges (or not) in an innovation ecosystem that serves as a collaborative space in Denmark. Our empirical findings challenge the mostly overenthusiastic connotations and thus the study contributes to the critical coworking research stream. More specifically, we give emphasis on the co-constructive entanglement of socio-spatial arrangements and we propose a framework for revisiting the design of CWS through 1) balancing the engineered and evolving parts of the ecosystem, 2) facilitating stakeholder alignment, 3) adopting a service-oriented approach and 4) developing inclusive strategies. Apart from the implications for scholars and practitioners who study and design CWS, we argue that future research would especially benefit from building on a service-oriented approach of innovation ecosystems and we call for more interdisciplinary research.     

Linking routines to operations capabilities: A new perspective

A typical approach to studying capabilities in the operations management literature is to assess the intended or realized competitive operational performance and their contribution to business and organizational objectives. While it is crucial to identify the operational performance that helps create competitive advantage, it is equally important to understand the means for delivering the needed performance at the operational level. Drawing on the resource-based view (RBV), we argue that routines are a critical source of operations capabilities and subsequently investigate operations capabilities by means of their underlying routines. Because a common problem to studying capabilities is the ambiguous and confusing definitions, we conduct an extensive literature review to address the semantic confusion among various definitions of capabilities and delineate it from other related terms. We identify improvement and innovation as two critical plant level capabilities, each consisting of a bundle of interrelated yet distinct routines. We then empirically measure the two capabilities as second-order latent variables and estimate their effects on a set of operational performance measures. The results suggest that routines form internally consistent bundles which are significantly related to operational performance. This supports our notion of “capabilities as routine bundles” that are difficult to imitate and thus a source of competitive advantage.     

Doing More with Less: Building Dynamic Capabilities for Eco‐Efficiency

This article sheds light on the manner in which managers perceive, develop and integrate dynamic capabilities for eco‐efficient activities inherent to industrial ecology. The research employs a case study of 12 Canadian facilities involved in the processing of a wide variety of waste materials. Findings from the experiences of 60 managers interviewed reveal that capabilities for industrial ecology largely depend upon the integration and coordination of competencies, innovations and new routines related to several functional areas: innovation and technological development; control of residual material flows; adjustments in human resources; management of environmental constraints; and networking and marketing. These dynamic capabilities are developed and integrated through a four‐stage process: local experimentation, internal operationalization, enlargement/cross‐functional integration and strategic consolidation. The paper contributes to the extant literature related to dynamic capabilities and the natural resource‐based view by offering an understanding of those factors necessary for the success of industrial ecology, and also by demonstrating the functional and dynamic nature of such factors. Copyright © 2017 John Wiley & Sons, Ltd and ERP Environment     

Knowledge processing and ecosystem co-creation for process innovation: Managing joint knowledge processing in process innovation projects

Process innovation drives industrial competitiveness and sustainability but remains elusive since it requires co-creation and the sharing of idiosyncratic design knowledge in ecosystems of providers and customers of process equipment. This paper investigates how firms can manage knowledge processing through co-creation in joint process innovation projects. Analysis of cross-comparative case studies –including nine industrial ecosystem actors – identifies three types of technological challenge (complexity, novelty and customization) that creates knowledge-processing requirements (uncertainty, equivocality) during the value co-creation process. To manage these knowledge-processing requirements, this paper explains how three joint knowledge-processing strategies (joint problem solving, open communication and end-user involvement) help ecosystem partners make sense of the requirements and demands in process innovation. In this context, the procurement approach (such as contracting and relationship development) helps to facilitate higher levels of joint knowledge processing, drawing on the diverse knowledge of ecosystem actors to secure successful process-innovation outcomes. The present study contributes to the emerging literature on co-creation in process innovation by developing a framework that highlights the knowledge-processing dynamics in ecosystem relationships for process innovation. The implications for management extends to a practical tool that guides project managers in ensuring appropriate levels of joint knowledge processing among ecosystem actors.

     

HR in collaborative innovation with customers: role,alignment and challenges

Companies are engaging in collaborative innovation with their customers (CIC), but there has been no comprehensive discussion of the role of human resources (HR) in such initiatives or the challenges involved. We begin with a brief overview of CIC and the challenges for HR and then draw on different streams of research to develop a conceptual framework for the alignment of HR with CIC strategies. Theoretical foundations for the components of the framework are integrated with the discussions of its various components. We begin with a review of staffing and development practices focused on collaboration and relationship skills, as well as creativity, and collaborative- and commitment-oriented HR systems. We then discuss how HR deployment, performance management, control practices and contextual factors potentially affect the relationship between antecedent HR practices and the collaborative and innovative behaviors needed for CIC. Several challenges in aligning HR practices with CIC are explored, such as the limited supply of research talent inclined toward CIC, skills for collecting tacit knowledge, performance assessment and risk-related career implications. Other broader challenges are discussed, such as deployment, preserving internal innovation capabilities and controlling confidential information. Suggestions for overcoming challenges for HR in CIC are discussed and ideas for future research are provided.     

A maturity framework for autonomous solutions in manufacturing firms: The interplay of technology,ecosystem, and business model

Significant advancements within the fields of digitalization, electrification, and automation have enabled the development, testing, and implementation of increasingly advanced autonomous solutions. Current examples of industrial automation promise significant economic and sustainability-oriented benefits for industrial customers. Yet, implemented autonomous solutions have rarely advanced beyond ‘islands of autonomy’. Although enabling initial improvements in the efficiency and effectiveness of operations, they have not led to the systemic process improvements that fully integrated site-wide solutions can achieve. It is becoming increasingly clear that the major challenges in this shift extend beyond technology to focus on business transformation and ecosystem relationships. Yet, extant research offers few insights into these domains. There is a need to develop a business-focused maturity framework for autonomous solutions to contribute to a predominantly technical discourse and support equipment actors and their wider ecosystems in commercializing autonomous solutions. Thus, the purpose of this paper is to investigate how industrial equipment manufacturers can align the development of technology, business models and ecosystem relationships for the advancement of autonomous solutions. We build on case studies that include 32 interviews from four industrial equipment manufacturers and their extended ecosystems of customers and partners. We capture our findings in a three-level maturity framework for industrial autonomous solutions. This framework unwraps the attributes of each level from the perspectives of technical system development, ecosystem configuration, and business model design and is complemented by three overarching principles for the successful commercialization of autonomous solutions.

     

Capability hierarchy in electronic procurement and procurement process performance: An empirical analysis

This paper examines the interrelationship between two hierarchically structured functional capabilities pertinent in the organizational procurement process, and the impact of these capabilities on procurement process performance. These functional capabilities operate at different levels in an organization's procurement process. We draw upon resource- and knowledge-based views of the firm to theorize that in this hierarchy of information technology-enabled procurement capabilities, the higher-level capability – procurement integration competence – enables firms to develop and deploy a lower-level capability – digital procurement competence. Further, we theorize that the lower-level capability impacts procurement process performance directly and completely mediates the relationship between higher-level capability and performance. Thus, although performance is impacted directly only by the lower-level capability, the higher-level capability facilitates the development and use of the lower-level capability. Our research model is tested using survey data from a large sample of 412 manufacturing firms. The results provide strong support for the proposed research model. In particular, we find that as hypothesized, the impact of procurement integration competence on performance is completely mediated by digital procurement competence. Our results suggest that when examined at the procurement process level, the impact of higher-level capabilities may be manifested completely through the lower-level capabilities. Theoretical and practical implications of the research are discussed.     

Ambidexterity and IT competence can improve supply chain flexibility? A resource orchestration approach

Supply chain flexibility (SCF) has become an important competitive weapon for companies in the current dynamic environment. This paper explores the influence of ambidexterity on supply chain flexibility (SCF) and theorizes the moderating effect of information technology (IT) competence on that relationship. Whereas prior research focuses on the positive results of SCF for business performance, little empirical research has studied its facilitators, leaving the gap this study seeks to fill. We draw on resource orchestration theory to develop our research model. According to this theory, a firm can exploit the full potential of its resources and capabilities only when these are deployed in a complementary manner. This study proposes that ambidexterity impacts SCF positively and that its effect is amplified when the firm possesses IT competence. In order to test our hypotheses we have employed a hierarchical regression methodology and put into service data collected from manufacturing enterprises. The study confirms that ambidexterity, as the ability to explore and exploit SC resources, enables their orchestration, making SC resources flexible, and a high IT competence facilitates that orchestration.     

Are fiscal policy incentives effective in stimulating firms' eco-product innovation? The moderating role of dynamic capabilities

This study investigates the effectiveness of fiscal policy incentives—in particular, direct subsidies and tax credits—in stimulating eco-product innovation among Chinese manufacturing firms. We also examine the moderating effects of dynamic capabilities. The empirical results, which are based on survey data from 265 firms in China, demonstrate that both direct subsidies and tax credits are conducive to firms' eco-product innovation. In addition, we find that when firms' dynamic integration capabilities are strong, the facilitating effects of direct subsidies and tax credits on eco-product innovation are likewise strong. Moreover, dynamic reconfiguration capabilities positively moderate the relationship between tax credits and eco-product innovation. By identifying moderators that influence the effect of fiscal incentives on eco-product innovation in heterogeneous firms, this study contributes to fiscal policy debates and realizing sustainable development.     

Enhancing green product and process innovation: Towards an integrative framework of knowledge acquisition and environmental investment

Despite the increasing interest in green innovation literature, little is known on how and under what conditions firms' knowledge transfer activities affect green innovation. There is lack of research that on how particular organizational capabilities are seen more useful and how it influences on green innovation performance. To address this research gap, we examine a mediation model in which we explore whether a firm's knowledge acquisition capability and investment in environmental management mediate the impact of buyer-driven knowledge transfer activities on green product innovation and green process innovation. On the basis of an analysis of a sample of 239 manufacturing firms, we find that buyer-driven knowledge activities have a greater positive impact on green product innovation than green process innovation. Investment in environmental management fully mediates the relationship between buyer-driven knowledge transfer activities and green process innovation, and knowledge acquisition capability partially mediates the relationship between buyer-driven knowledge transfer activities and green product innovation. The current study provides evidence that internal competencies and the role of buyers in knowledge transfer are critical for explaining the green product innovation and green process innovation. Our results suggest that buyer involvement pushes firms to develop resource acquisition capability to enhance green product innovation. Our results also highlight the importance of investment in environmental management for overcoming the environmental challenges in the manufacturing firms.     

The HR ecosystem framework: Examining strategic HRM tensions in knowledge-intensive organizations with boundary-crossing professionals

In this article, we use Snell & Morris' (2021) new HR ecosystem framework to empirically examine strategic fit and alignment tensions for knowledge-intensive organizations and professional knowledge workers. Rich data were collected through in-depth interviews with 75 members of faculty engaged in knowledge-intensive work for Business and Management Schools (B&M), and the analysis of strategy documents. The application of the framework enables us to contribute to dynamic capabilities theory and SHRM in four ways. Firstly, drawing on the findings, we propose an adapted HR Ecosystem framework for analyzing knowledge-intensive organizations, which incorporates tensions across the four subsystems of an HR ecosystem (strategy, capabilities, composition, and cultures). These tensions are shaped by interactions within and between levels (meso, macro and micro) and ecosystems. Secondly, our findings underscore the need for knowledge-intensive organizations to engage with a plurality of collaborative and competing internal and external stakeholder interests, including those of knowledge workers who constitute key organizational stakeholders. Thirdly, our analysis shows how the views and behaviors of internal organizational stakeholders are affected by ecosystem dynamics within and beyond the physical boundaries of an organization. Fourthly, we reveal how conflicting organizational cultures connect with other HR ecosystem subsystems to constrain collegialism and cohesion. By evidencing how knowledge-intensive organizations are in a constant flux of alignment and misalignment, the article demonstrates the value of the HR ecosystem framework in examining and informing SHRM in organizations in other industries.     

Leveraging entrepreneurial ecosystems as human resource systems: A theory of meta-organizational human resource management

Entrepreneurs require human resources to establish and scale their ventures; however, constraints often prevent entrepreneurs from investing in formal human resource systems. How entrepreneurs overcome human resource challenges by leveraging their entrepreneurial ecosystems as informal inter-organizational talent management systems has been overlooked by scholars. We propose a model of entrepreneurial ecosystem human resource management, theorizing that ecosystem participants collectively perform the human resource management function for entrepreneurship communities. Drawing from economic rents theory, we explain how entrepreneurial ecosystems encourage a form of meta-organizational human resource management that allows ecosystem participants to coordinate talent acquisition, learning and development, performance management and rewards, and retention. Coordinated entrepreneurial ecosystems improve entrepreneurial performance by sourcing talent, onboarding selected members, enculturating ecosystem values, developing entrepreneurial skills, and retaining human resources, which in turn generates rents. We discuss how our theory catalyzes research at the HR and entrepreneurial ecosystems interface and reveals insights for practitioners.     

The microfoundations of firms’ explorative innovation capabilities within the triple helix framework

In this paper we show how the triple helix model provides an organising regime within which participant firms can extend their capabilities for explorative innovation through funded collaborations with academia. In so doing, we adopt Felin et al.’s multi-level framework to examine the microfoundations of participant firms’ capabilities for explorative innovation in university partnerships. In our qualitative case study of a set of research projects that comprise a national research programme, we decomposed the microfoundations of the processes, interactions and the structures that facilitated the extension of member firms’ explorative innovation capabilities nurtured within each university-industry partnership. We explain the attitudinal and behavioural modifications of the firms’ individuals involved in the research project collaborations with university partners that aggregated into firm-level capabilities. Ultimately, we show that using a microfoundational lens allows for a deeper understanding of how triple helix programmes can influence the capabilities of firms for explorative innovation.     

From circular business models to circular business ecosystems

The circular economy aims to minimize resource inputs and waste and emission outputs of the economy and its organizational subsystems. This can benefit both financial and sustainability performance of companies. To analyze industrial implementation of the concept, the prevalent unit of analysis on the firm level is currently the circular business model. Our investigation of nine Swedish biogas companies and one branch organization indicates a range of conceptual shortcomings that challenges this approach. Our comparative case analysis points towards circular ecosystems being a more appropriate concept to describe the high level of coordination between different stakeholders necessary to implement circular systems. This increases the suitability to analyze, plan, and communicate circular economy systems on an organizational level, especially if value chain integration is low. An ecosystem perspective can thus support innovation and entrepreneurship in the context of the circular economy.     

Exploring early purchasing involvement in discontinuous innovation: A dynamic capability perspective

This paper aims to address the gap concerning our knowledge about early purchasing's involvement (EPI) in new product development (NPD) projects in contexts characterized by discontinuous innovation. We adopt a dynamic capability perspective to explore how existing sourcing and supplier relationship management capabilities are adapted when purchasing agents become involved in discontinuous innovations projects. We use an embedded case-study approach to study four NPD projects in a heating, ventilation, and air conditioning (HVAC) company. The case studies are based on interviews with managers and staff from the research and development, purchasing, and marketing departments, as well as suppliers involved in the projects. Our empirical findings capture emerging purchasing practices including a “reversed” sourcing process, purchasing-marketing interaction, and the coordination of “a learning atmosphere” between the R&D department and suppliers through proactive innovation meetings and creativity workshops. We derive propositions to conduct further research into the role of the purchasing department in times of discontinuous innovation. We also provide a framework of sourcing and supplier-relationship practices that firms can use when embarking on discontinuous innovation.