Inbound open innovation in SMEs: indicators,non-financial outcomes and entry-timing

This study contributes to the literature on inbound open innovation in three ways. Firstly, it verifies the suitability of three groups of innovation activities (external information sources, cooperation and acquisition of machinery, knowledge or R&D) as indicators of open innovation, by modelling their relationship with the openness of the development of new products. Secondly, it relates these activities to three non-financial product-oriented outcomes of small and medium enterprises (SMEs): quality, product range and market share. When significant, the signs of the relationships are always positive. Thirdly, it is the first to link two streams of the literature on innovation within SMEs: open innovation and entry-timing. We distinguish between pioneers (the first to introduce innovations onto the market) and followers and find that most open innovation activities relate to the pioneering behaviour. This should be taken into consideration when designing public policies supporting innovation. Data include Spanish innovative SMEs from the Community Innovation Survey.     

Measuring emerging categories of innovation: Modularity and business model

The oft-cited dichotomy between incremental and radical innovations is less important when we have to analyze how a new technology and its social institution coevolve. In this context, besides incremental and radical innovations, C. Freeman added two more categories of technical change: one is change in the technology system and the other is change in the technoeconomic paradigm.However, as the information technology (IT) revolution progresses further, we come to need more categories of innovations. In the computer industry, the concept of “module” is becoming a solution to growing complexity. In the new IT environment, we can be proactive in demand creation. It becomes crucial, therefore, whether the creation of new “business models” has followed technical innovations. In this article, we will try to demonstrate how these different categories of innovations, i.e., modularization and new business model creation, can be measured.     

Linking technology intelligence to open innovation

The explosive growth of the Internet has led to a dramatic increase in data sources for (competitive) technology intelligence. Appropriate implementation and use of IT tools to gather and analyze these data is of key importance for the creation of actionable technology intelligence. A strategy to optimize investments in the identified technologies becomes of paramount importance if an organization wants to match knowledge and ideas originating from outside of the organization with internal core competences. Such a strategy can create competitive advantage by effectively linking technology intelligence to open innovation.We show how VIB, a life sciences research organization, has established technology intelligence processes to identify a multitude of external technologies of interest, which are subsequently “probed” for their potential and fit with VIB using real options reasoning, thereby supporting open innovation. Our methodology may be useful for other organizations which are considering implementing open innovation approaches.     

New functionality development through follower substitution for a leader in open innovation

There has been a paradigm shift to a knowledge-oriented economy in the 21st century. Consequently, there has also been a shift in where innovation typically occurs. This shift has been from the production site toward the process of product diffusion. That is, innovation occurs more frequently at the point at which a product or service is moved into the marketplace where it is immediately modified through customer interaction. In this process, new “functionality” — services, the delivery method or even product changes occur in the diffusion process. Given the need to constantly create new value through new product “functionality” or new “functionality development”, firm strategy must address the issue of how to enhance innovation at this new locus — the diffusion process. Sustainable new functionality development over time has become crucial to a firm's competitiveness. In this context, firms have to develop new functionality as early and quickly as possible; leveraging whatever innovation exists in the marketplace. According to theory, the early emergence of functionality development in this context depends on a dynamic system in which the imitator (follower) is constantly substituting for the innovator (leader). This substitution corresponds to the dynamics observed in the process referred to as “open innovation”. According to this theory, functionality development through follower substitution for a leader would be critical for a firm's competitiveness in the open innovation environment. Furthermore, open innovation could be a process for sustaining the ongoing creation of new value through functionality development maximizing limited resources. This paper attempts to demonstrate this hypothesis through an empirical analysis of this process of substitution in major innovative goods and services in Japan.     

Nonlinear dynamism of innovation and business cycles

The aim of this paper is to describe the nonlinear dynamism of innovation and to clarify the role of innovation for economic development in terms of Kondratiev business cycles, especially the causal relation of the bubble economy and depressions with innovations. Any paradigm of technological innovation develops within a definite time span reaching maturity. This nonlinear nature clarifies many characteristic features of innovation. Schumpeters innovation theory on business cycles is examined through this dynamism. Trunk innovation is defined as that which plays a decisive role in building infrastructures and inducing subsequent innovations. Every innovation has its own technological development period just before the innovation diffusion. The emergence of new markets can be estimated by chasing the ongoing technologies.JEL Classification: E32, L16, O11, O14, O30Paper presented at the 9th Conference of the International J.A. Schumpeter Society, Gainesville, Florida, USA.Previous affiliation was Ryutsu Kagaku University, Faculty of Information Science, Kobe, Japan.     

The co-evolution of business incubation and national innovation systems in Taiwan

Incubation has already proven to be of great value in promoting small and medium enterprise (SME) entrepreneurship activities and technological development in developed and developing countries. Incubation not only provides a diversified and integrated service for entrepreneurial ventures but also contributes upward to regional and national innovation and economic growth. Building upon the logic of co-evolution theory, this paper argues that incubation acts at the meso-level as a critical interface between macro-innovation systems and micro-business ventures. These multi-directional coupling elements in innovation ecology co-evolve to achieve collective interests and excellence, which in turn may stimulate technological development and social change. Important processes/mechanisms, including a policy kit and action, strategic networking, supportive associations, knowledge and intellectual capital management, among others, are discussed. Drawing on the national innovation system (NIS) and business incubation (BI) experience in Taiwan, we discuss the future prospects of incubation and innovation policies, including industrializing and globalizing incubation activities and virtual business incubation.     

Organisational change in new ventures in Chinese context: the open innovation

This paper uses case study method to examine the acquisition process of information and funding through the implementation of open innovation (OI) in new ventures in Chinese context. We find that in the process of accessing to the marketing or technical information through OI, the most important thing for enterprises is to establish trust and cooperation with familiar partners, and trust is derived from existing social relations. In the process of funding acquisition through OI, the most important thing for enterprises is to strike a balance between gains and losses.     

Dynamics of CSFs for business innovation: Normal vs. Crisis economic conditions

This research reviews the literature on business innovation, identifies CSFs for business innovation, empirically tests the validity of CSFs as well as examines the impact of CSFs on the success of business innovation, and investigates whether CSFs for business innovation are identical or different in normal and crisis economic conditions. Thorough extensive literature review, eleven CSFs were identified: motivation and rewards, TF team manpower, strategy, methodology, goals and measurement, organizational structure, change management, role of information technology, implementation, leadership, and communication. The respondents rated leadership as the most important CSF, followed by motivation & rewards, change management, TF team manpower, role of information technology, and strategy. In crisis economic conditions, the respondents evaluated leadership as the most important CSF, followed by motivation and rewards, TF team manpower, change management, strategy, and role of information technology. It may be that management approaches business innovation more strategically and methodologically to successfully complete business innovation projects since there are scarce resources and increasing pressure for success in crisis economic conditions. Regression analyses show that CSFs in total have very significant explanatory power in the success of business innovation and reveal that leadership and TF team manpower have the strongest explanatory power.     

Top management team boundary-spanning behaviour,bricolage, and business model innovation

ABSTRACT

Resources are basic element of business model innovation, but most enterprises face serious resource constraints due to their capability limitations. This study focuses on boundary-spanning behaviour of top management team and bricolage, to explore their influence mechanism on business model innovation. A hierarchical regression analysis is carried out on data from China. Responses from 163 enterprises indicate that top management team boundary-spanning behaviour has a significantly positive influence on business model innovation, that bricolage has a significantly positive effect on business model innovation, and that bricolage plays a significant intermediary role between top management team boundary-spanning behaviour and business model innovation. This study enriches theoretical and empirical researches on business model innovation while serving as a valuable reference for business practice.     

The impact of exploration and exploitation learning on organisational innovativeness among hospitals: an open innovation view

This study tries to explore the impact of exploration and exploitation learning on organisational innovativeness among health service organisations from an open innovation view. We developed several constructs including realised absorptive capacity (RACAP), breadth and depth of external knowledge acquisition and tried to explore the roles of these constructs in the influence process of organisational learning on organisational innovativeness. The mail survey was used to collect research data from top hospital managers in Taiwan. The overall valid response rate was 44.23%. We applied a structural equation model to test the research hypothesis. Results indicated the breadth and depth of external knowledge acquisition would affect organisational innovativeness through RACAP. Exploration learning had a directly positive influence on RACAP and also had an indirect impact through the mediation of breadth and depth of external knowledge acquisition among health service organisations.     

中小企业开放式创新能力提升途径研究

从知识管理的视角出发,将企业开放式创新能力分解为发明能力、吸收能力、转换能力、连接能力、创新能力和解吸能力,指出通过吸收能力、转换能力和连接能力来带动发明能力、创新能力和解吸能力的提升是中小企业实施开放式创新的有效途径。从企业内部合作、外部网络化、由内而外和由外而内合作三个方面揭示了连接能力所包含的主要内容及提升方法;从管理、组织内部、组织间和先前拥有的知识等方面分析了影响吸收能力的前因及其提升方法;对转换能力提升过程中,如何进行知识的保留、选择和激活进行了研究。     

The relationship between business diversification and productivity: considering the impact of process innovation at different corporate life cycles

This paper investigates the link between a firm's process innovation (PI) and its segment productivity at different life cycles. The results show that business diversification is negatively associated with a firm's productivity, and further reveal that a firm's PI moderates the above relationship. In addition, the corporate life cycle literature builds blocks for this study to explain that the involvement of administrative costs varies across life cycles when diversified firms get mature and bigger. Our empirical evidence indicates that the potential costs of a complex organisational structure contingent on business diversification at a firm's mature life cycle could be alleviated by the conduct of process innovation. As process innovation at different life cycles may alter managerial incentive that leads to different firm performance, the managerial implication is that diversified firms should appropriately engage in process innovation to prevent unfavourable liability from the development of their businesses.     

Knowledge transfer in an innovation simulation model

To understand the development of innovation processes in these knowledge-driven economies, one needs to focus on underlying processes of creating and sharing new knowledge. In this paper, an evolutionary simulation model is used to achieve some insights into these innovation processes. The model is based on the one hand on rules about market performance, investments and R&D strategies, and on the other hand on a model concerning knowledge creation (the ability of firms to create knowledge through intramural R&D efforts and the ability to discover and absorb new developments from basic academic research and competitors) and knowledge transfer based on an exponentionally expanding pool of (not necessarily new) knowledge of innovations in the own sector, but also from external sources. It is demonstrated that the imitative firm can be economically more successful but this strategy may prove to be superior only after a long time span.     

Users and radical innovation performance: the moderating role of the organisational context

This study investigates four key factors of the internal organisational context that moderate the relationship between connecting with users and radical innovation performance: performance management, autonomy, internal networking and organisation and culture to support innovation. These components define a firm's organisational context. A sample of Austrian- and Italian-based firms shows that the connecting with users–radical innovation performance relationship is amplified at higher levels of all the investigated elements of the organisational context. The authors discuss the study's implications as well as future research directions.     

Influence of open innovation strategies on employment dynamics: evidence for Spanish manufacturing firms

ABSTRACT

In this paper, we explore the influence of different modes of openness of innovative firms on employment growth. Using a panel database of Spanish manufacturing firms during the period 1998–2015, we analyze the influence open innovation (OI) strategies on employment distinguishing by type of external partner. The main objective of the research is to know whether opening innovation strategy contributes to employment taken into account another firm capabilities and sectorial technological opportunities. For this purpose, a two-step procedure is specified. Firstly, a random-effect computes the effects of OI on the innovation probability. In the second step, the variation of innovativeness due to openness on GMM-system estimation controlling by potential endogeneity and unobserved firm heterogeneity is used. The results support that the influence of open strategy on employment growth is positive. Moreover, the employment depends on the breadth of OI measured by the number of out-inbound relationships. Finally, the employment consequences are different for each mode of open strategy.     

Determinants of innovation behaviour and investment estimates for west-german manufacturing firms

In this paper, the determinants of innovation behaviour and investment are explored with a large micro-data panel from West-German manufacturing firms. The estimates are discussed within a microeconomic model with monopolistic competition, demand uncertainty and a delayed adjustment of capacities and the production technology. The estimates reveal positive firm-size effects which hint towards scale economies associated with innovations. Market power promotes innovations but not investment, and exporters innovate more but exhibit less investment expenditures. Finally, excess demand promotes innovations. This indicates a complementarity of innovations and investment and hints towards permanent productivity effects of temporary demand shocks.     

The role of top management team diversity in shaping the performance of business model innovation: a threshold effect

Business model innovation is one of the firm’s most important strategic decisions. Top management team (TMT), as the critical decision-makers, has essential influence upon such decisions. However, the role of TMT diversity in shaping the performance of business model innovation is less explored in the literature. Based on a sample dataset of 906 observations of small and medium enterprises from China Startups Stock Market during the period of 2009–2011, we find that TMT diversity exhibits a significant threshold effect on the relationship between business model innovation (in terms of novelty-centred and efficiency-centred business model) and firm performance. More specifically, when TMT functional diversity arrives at a certain level, the positive relationship between novelty-centred business model and firm performance becomes more pronounced. On the other hand, the positive relationship between efficiency-centred business model innovation and firm performance will be more significant when TMT tenure diversity increases to a certain level.     

Beyond absorptive capacity in open innovation process: the relationships between openness,capacities and firm performance

The literature has shown that open innovation (OI) can be a winning strategy in improving firm performance. However, in order to adopt and implement it, managers need to resolve practical problems, such as understanding the role played by OI capacities and openness on firm performance. In response to these needs, this study aims to investigate the hierarchical relationships between openness, OI capacities and performance using a structural equation model approach. This paper also attempts to compare the levels of openness between firms in different industries to discover similarities and differences in OI phenomena. The analysis of data obtained from a survey of Korean firms shows significant interrelations between openness, OI capacities and firm performance. Our results go further in developing understanding of the building blocks on which successful OI is built and particularly suggest that desorptive capacity which underpins the out-bound OI process, is in turn strongly supported by knowledge management capacity. It is hoped that the results of this study can enrich our understanding of the OI mechanism and provide managerial and policy implications.     

不同战略导向对自主创新与合作创新的影响研究

在动态竞争的环境下,如何选择适合自身发展的创新方式已成为企业技术创新中面临的难题.文章在借鉴前人研究的基础上,把企业家导向、市场导向、自主创新及合作创新整合在同一理论模型中,针对相关因素之间的关系,提出4种命题,从而为企业提高自主创新效率提供了有效路径.     

A Schumpeterian model of investment and innovation with labor market regulation

Theoretical and empirical models provide ambiguous responses on the relationship between labor market regulation, innovation and investment. On the one hand, labor market regulation increases firms' adjustment costs and, ceteris paribus, decreases investment. But, on the other, it also stimulates firms to invest, innovate, increase productivity and profit in the long run. In this paper we present an endogenous growth model that describes the role of these opposite forces, and why a stricter labor market regulation may positively affect innovation and investment in the long run. Most of the theoretical and empirical results hold for Italy, Germany, France, and Spain.