Joining Forces or Going It Alone? On the Interplay among External Collaboration Partner Types,Interfirm Governance Modes,and Internal R&D

This paper adds to the emerging literature stream advocating a contingency view on open innovation. Drawing on the relational view of the firm, this study sheds light on the complex interplay among collaboration partner types (market‐ and science‐focused innovation partners), governance modes (informal, self‐enforcing and formal, contractual collaboration governance), and internal research and development(R&D). More specifically, it is proposed that the use of governance modes tailored to both the characteristics of each innovation partner type and the specific innovation objectives pursued by the focal firm (incremental and radical new product development) can increase the payoff from innovation collaboration. Moreover, appropriate collaboration governance is expected to reduce the focal firm's vulnerability to possible negative side effects often assumed to be associated with the simultaneous pursuit of external collaboration and internal R&D, among which most notably the not‐invented‐here (NIH) syndrome. Cross‐industry evidence from 2502 German firms underlines the critical role of collaboration governance—a contingency factor that is at the heart of the relational view, yet has remained surprisingly absent from the open innovation debate so far.     

When Does Search Openness Really Matter? A Contingency Study of Health‐Care Innovation Projects

Given the growing popularity of the open innovation model, it is increasingly common to source knowledge for new product ideas from a wide range of actors located outside of organizational boundaries. Such open search strategies, however, might not always be superior to their closed counterparts. Indeed, widening the scope of knowledge sourcing at the ideation stage typically comes at a price given the substantial monetary and nonmonetary costs often incurred in the process of identifying, assimilating, and utilizing external knowledge inputs. Considering both the benefits and costs of search openness, the authors develop a project‐level contingency model of open innovation. This model suggests that search openness is curvilinearly (taking an inverted U‐shape) related to new product creativity and success. They hence assume that too little as well as too much search openness at the ideation stage will be detrimental to new product outcomes. Moreover, they argue that the effectiveness of open search strategies is contingent upon the new product development (NPD) project type (typological contingency), the NPD project leader (managerial contingency), and the NPD project environment (contextual contingency). To test these propositions empirically, multi‐informant data from 62 NPD projects initiated in the English National Health Service (NHS) were collected. The econometric analyses conducted provide considerable support for a curvilinear relationship between search openness and NPD outcomes as well as for the hypothesized contingency effects. More specifically, they reveal that explorative NPD projects have more to gain from search openness at the ideation stage than their exploitative counterparts. Moreover, the project‐level payoff from search openness tends to be greater, when the project leader has substantial prior innovation and management experience, and when the immediate work environment actively supports creative endeavors. These findings are valuable for NPD practice, as they demonstrate that effective knowledge sourcing has much to contribute to NPD success. In particular, pursuing an open search strategy might not always be the best choice. Rather, each NPD project is in need of a carefully tailored search strategy, effective leadership, and a supportive climate, if the full value of external knowledge sourcing is to be captured.     

The (Unknown) Providers to Other Firms' New Product Development: What's in It for Them?

For every inbound activity by a firm in open innovation, a reciprocal outbound activity by another firm must be generated. The reciprocal outbound activities range from transferring of knowledge and ideas to solutions delivered to other firms' new product development projects. This paper names the firms that produce the reciprocal outbound activity for “providers,” and is the first to empirically investigate such providers of ideas, solutions, and technologies for other firms' open innovation activities. The literature review shows a surprising shortage of research on who the providers are, how they engage with other firms, and not least what potential benefits can be achieved from supporting other firms' innovation activities. The paper uses a quantitative survey on Danish small and medium‐sized enterprises (SMEs) carried out in 2010 to identify the providers, the role they take on, and the main benefits the providers gain. This paper finds that firms that are providers are indeed an under‐researched and important phenomenon for firms' innovation activities. Compared to receivers of knowledge, the providers are younger, have a higher R&D intensity, adopt more open innovation practices, have higher absorptive capacity, and fewer barriers toward knowledge sharing as demonstrated by the NIH and NSH syndromes. Finally, although only tentatively, the paper finds that the provider firms are more product innovative compared to nonproviders. The paper further finds that more projects, more embedded relationships, and mutual rather than one‐way exchange relationships significantly raise the probability that a firm experiences a substantial benefit from providing to other firms' new product development projects. The overall ambition of the paper at this point is to inspire other researchers to pursue the agenda on the provider perspective for future research. To support such research, the paper suggests a broadening of the research perspectives from the receiver of knowledge, in the literature on interorganizational relationships and open innovation, to include the provider, and even suggests some preliminary ideas for such research. Hence, the contribution of this paper lies not only in opening a new research topic but also in identifying some first characteristics of the phenomenon adding a substantial perspective to the literature on open innovation and interorganizational relationships. The paper formulates three indicative recommendations for managers that consider becoming a provider to other firms' NPD.     

Product Innovation Processes in Small Firms: Combining Entrepreneurial Effectuation and Managerial Causation

This article reports a multimethod study of product innovation processes in small manufacturing firms. Prior studies found that small firms do not deploy the formalized processes identified as best practice for the management of new product development (NPD) in large firms. To explicate small firms' product innovation, this study uses effectuation theory, which emerged from entrepreneurship research. Effectuation theory discerns two logics of decision‐making: causation, assuming that means are selected to attain goals; and effectuation, assuming that goals are created based upon available means. The study used a process research approach, investigating product innovation trajectories in five small firms across 352 total events. Quantitative analyses revealed early effectuation logic, which increasingly turned toward causation logic over time. Further qualitative analyses confirmed the use of both logics, with effectual logic rendering product innovation resource‐driven, stepwise, and open‐ended, and with causal logic used especially in later stages to set objectives and to plan activities and invest resources to attain objectives. Because the application of effectuation logic differentiates the small firm approaches from mainstream NPD best practices, this study examined how small firms' product innovation processes deployed effectuation logic in further detail. The small firms: (1) made creative use of existing resources; (2) scoped innovations to be realizable with available resources; (3) used external resources whenever and wherever these became available; (4) prioritized existing business over product innovation projects; (5) used loose project planning; (6) worked in steps toward tangible outcomes; (7) iterated the generation, selection, and modification of goals and ideas; and (8) relied on their own customer knowledge and market probing, rather than early market research. Using effectuation theory thus helps us understand how small firm product innovation both resembles and differs from NPD best practices observed in larger firms. Because the combination of effectual and causal principles leverages small firm characteristics and resources, this article concludes that product innovation research should more explicitly differentiate between firms of different sizes, rather than prescribing large firm best practices to small firms.     

When Is Open Innovation Beneficial? The Role of Strategic Orientation

Various scholars have accomplished a great deal to better understand open innovation effectiveness. Case studies have detailed its performance effects, while other studies showed the effectiveness of an aspect of open innovation, such as collaboration with third parties, external technology commercialization, and cocreation. Though most studies report a positive relation between open innovation and innovation performance, some studies indicate possible negative effects. This has resulted in a call for research on what kind of organizational context suits open innovation best. This study therefore addresses two questions: (1) does performing open innovation activities lead to increased innovation performance, and to which aspects of innovation performance is open innovation most strongly related? (2) what is the moderating impact of various kinds of strategic orientation on the relation between open innovation and innovation performance? In this study, we investigate three types of strategic orientations: entrepreneurial orientation, market orientation, and resource orientation. In a survey among 223 Asian service firms, we first develop and test a comprehensive measurement scale for open innovation that captures the entire range of open innovation activities, including outside‐in activities, inside‐out activities, and coupled activities. The final scale comprises of 10 items and indicates to what extent a firm has implemented open innovation activities. Next, we study the relation between open innovation and innovation performance. The results indicate that performing open innovation activities is significantly and positively related to all four dimensions of innovation performance: new product/service innovativeness, new product/service success, customer performance, and financial performance. The impact of open innovation is not limited to a particular aspect of innovation performance; it positively affects a broad range of innovation performance indicators. Though open innovation is positively related to all four dimensions of innovation performance, the effect sizes are not equal. The impact on new service innovativeness and financial performance is relatively stronger. Regarding the influence of a firm's strategic orientation, we find that all significant moderation effects are positive. This suggests that, in general, having a more explicit strategic orientation enhances the effectiveness of open innovation. When comparing the three strategic orientations, entrepreneurial orientation strengthens the positive performance effects of open innovation significantly more than market orientation and resource orientation do. In turn, market orientation has a significantly stronger moderation effect than resource orientation. These findings provide empirical evidence of the context dependency of open innovation. Especially an entrepreneurial orientation, which is associated with proactive and entrepreneurial processes, seems to create a fertile setting for open innovation.     

How to Overcome Pro‐Change Bias: Incorporating Passive and Active Innovation Resistance in Innovation Decision Models

Adoption literature is largely subject to a pro‐change bias; researchers mainly assume that consumers are open to change and thus interested in evaluating new products. However, consumers often reject innovations without considering their potential, such that the adoption process ends before it really has begun. The present study instead argues that innovation resistance, prior to product evaluation, is a regular consumer response that must be recognized and managed to facilitate new product adoption. The authors suggest differentiating passive from active innovation resistance. While passive innovation resistance results from a consumer's generic predisposition to resist innovations prior to new product evaluation, active innovation resistance is an attitudinal outcome that follows an unfavorable new product evaluation. This study also extends extant innovation decision models by describing how passive and active innovation resistance emerge and how they affect decision‐making in later stages of the process.     

Submission quality in open innovation contests - an analysis of individual-level determinants of idea innovativeness

The digital age allows for integration of dispersed groups into the innovation process. These heterogeneous groups of individuals varying in size and knowledge distribution, also referred to as crowds, build the basis for open innovation contests (OIC), one of the most common forms of crowdsourcing innovation. Different from more focused forms of open innovation, at OIC innovation managers often do not identify or evaluate participants ex-ante. Instead, innovation managers often make use of open calls for participation and assume efficient self-selection of participants i.e., that only motivated and qualified participants will volunteer and engage in the innovation contest. This behavior reflects one of the key assumption of crowdsourcing in participatory innovation settings. However, not every self-selected member is in the position to solve the contest task appropriately. Hence, innovation contests often result in large numbers of submissions, covering a wide range of quality levels, causing decision biases and significant workloads for innovation managers to select ideas. This problem is referred to as “crowding”. In order to reduce “crowding”, open innovation researchers are interested in understanding which types of individuals make the “best” contributions and therefore should be preferably encouraged to participate in in OIC. In this paper, we are assessing what characterizes those participants who submit innovative ideas to OIC, in particular those who submit incremental ideas vs. those who have more radical ideas. Drawing on the componential model of creativity and data generated in innovation contest held by chocolate producer Ritter Sport, we analyze the effect of participants‘ creativity, domain knowledge, and several motivational factors on the innovativeness of their contributions. We find all of these factors to affect the innovativeness of an idea. However, regarding generating incremental or radical innovations, some factors have opposing roles. Our findings imply for practice that innovation managers must decide which type of innovations they intend to generate and then design contests to attract participants with the required characteristics, if they want to increase the number of appropriate ideas and reduce the problems of “crowding”.     

Selecting Influential Business-to-Business Customers in New Product Development: Relational Embeddedness and Knowledge Heterogeneity Considerations

This study examines how the most influential business‐to‐business (B2B) customers, both existing and potential, involved in providing input to a new product development (NPD) project influence new product advantage. As the relational literature suggests, involving customers who have had close and embedded relationships with a firm's new product organization, such as a firm's largest customers, and customers who have been involved in past collaborative activities, should lead to the development of superior products. To the contrary, the innovation literature suggests that a firm may become too close to its large, embedded customers resulting in less innovation and in lower performing products. Also, the relationship between the heterogeneity of the knowledge of the most influential customers and new product advantage is examined. A contingency perspective is hypothesized such that the degree of product newness sought in the project moderates the effects of both relational embeddedness and knowledge heterogeneity on new product advantage. Empirical findings from a sample of 137 NPD projects support this contingency view. For projects seeking to develop incremental products, where the product being developed is an extension or an enhancement to an existing product, new product advantage tended to be higher in projects using embedded or homogeneous customers. For incremental projects, projects using less‐embedded or heterogeneous customers tended to have lower product performance. For projects following a highly innovative product strategy, new product advantage tended to be higher in projects that involved heterogeneous customers. These heterogeneous customers provided NPD projects with a diversity of perspectives, competencies, and experiences that fostered significant product innovations. The study contributes to the literature by empirically testing relational and innovation theories in NPD projects and by providing evidence on the importance of relational embeddedness and knowledge heterogeneity in selecting influential customers in NPD projects.     

The Contribution of In‐house and External Design Activities to Product Market Performance

Design may be seen as one of several key factors contributing to new product development, along with research and development, marketing, manufacturing, purchasing, etc. More and more, creative design comes to the fore, and many companies believe that superior design will be the key to winning customers. It has the ability to create corporate distinctiveness and also possesses the potential to give a product an individual or new look. Furthermore, the model of open innovation suggests that firms can and should use external and internal knowledge flows in order to create valuable ideas, and also internal and external paths to the market. Also, in the design process, a common trend toward external design skills has emerged in recent years. Due to cost and control factors, firms are increasingly outsourcing design activities. By using a sample of Belgian companies, this paper explores the contribution of design activities to product market performance. While there is mounting evidence that design can be seen as a strategic tool to successfully spur sales of new product developments at the firm level, the topic of design innovation has not yet been linked to the open innovation concept. In this paper, it is empirically tested whether design activities conducted in house differ in their contribution to new product sales from externally acquired design. So, do design activities that have been developed only with internal resources lead to a greater success than those that have been carried out with external sources of knowledge? Using a large cross‐section of manufacturing and service firms, the effects on sales of products new to the market and of imitations or significantly improved products of the firm are investigated. At first glance, the findings indicate that externally acquired design is not superior to in‐house design activities: the results show that only design activities that are mainly conducted with internal knowledge sources play a crucial role regarding the product innovation's success with market novelties. Design conducted in collaboration with external partners, however, has no significant influence. This is not the case for imitations, that is, products only new to the firm. Their success is also influenced by design activities developed with external collaborators. This effect is robust for several modifications of the model specification. In contrast to earlier literature on new technological developments, this paper argues that external design may not affect the sales of market novelties as the “market news” may spill over quickly to rivals through common suppliers including external designers.     

Innovation, imitation, and new product performance: The case of China

This paper compares the effects of innovation and imitation strategies on new product performance and examines their contingency across different market conditions in China. The empirical results from a cross-industry survey show that, compared with an imitation strategy, an innovation strategy leads to better new product performance. Furthermore, the benefits of an innovation strategy over an imitation strategy become stronger as market demand is increasingly uncertain, technology changes rapidly, and competition intensifies. The author compares the findings with the predictions put forward in previous Western-based literature and discusses the implications of the findings in light of China's unique market characteristics.     

An Exploratory Study of the Innovation Evaluation Process

In their search for the keys to successful product innovation, product managers and researchers typically focus on trying to identify the most effective organizational processes, strategies, and structures. Surprisingly, little or no effort is directed toward understanding the process that consumers use for evaluating an innovation. By gaining insight into this evaluation process, a firm can present an innovative product in a more effective manner and thus increase the likelihood that consumers will respond favorably to the innovation. Richard W. Olshavsky and Richard A. Spreng provide insight into this process by describing the results of an experiment in which subjects were asked to evaluate several innovative concepts. From their observations, they develop a model of the detailed information-processing steps that these consumers employed in order to evaluate the new products. Consistent with previous research, they found that judgment was the predominant evaluation strategy, particularly for the most innovative concepts. Various subjects also used a categorization strategy, though none used categorization for more than four of the nine concepts that were evaluated. Contrary to expectations, none of the evaluations relied solely on the manufacturer's reputation or the recommendation of a friend. In a simplified model of the evaluation process, when presented with an innovative concept, consumers first attempt to categorize the product. In other words, an innovation may be rejected simply because consumers somehow link it to an existing category that has a negative connotation. If consumers cannot categorize the product, they then employ a judgment process based on some evaluative criteria. Based on the data collected in this study, this simplified model is extended to include four other cognitive processes that strongly influence the evaluation process: forming evaluative criteria, forming expectations about the innovative concept, assessing satisfaction with an old product, and comparing the new and old products. When faced with a highly innovative concept, consumers may find it difficult to form their own evaluative criteria and expectations concerning that innovation. Consequently, managers may have an opportunity to shape the judgment process by educating consumers about the appropriate evaluative criteria or by clearly communicating the product's attributes, benefits, and appropriate use.     

Organizing for Inbound Open Innovation: How External Consultants and a Dedicated R&D Unit Influence Product Innovation Performance

Firms increasingly acquire technological knowledge from external sources to improve their innovation performance. This strategic approach is known as inbound open innovation. The existing empirical evidence regarding the impact of inbound open innovation on performance, however, is ambiguous. The equivocal results are due to moderating factors that influence a firm's ability to acquire technological knowledge from external sources and to transform it into innovation outputs. This paper focuses on a relevant yet overlooked category of moderating factors: organization of research and development (R&D). It explores two organizational mechanisms: one informal and external‐oriented (involvement of external consultants in R&D activities) and one formalized and internal‐oriented (existence of a dedicated R&D unit), in the acquisition of technological knowledge through R&D outsourcing, a particular contractual form for inbound open innovation. Drawing on a capabilities perspective and using a longitudinal dataset of 841 Spanish manufacturing firms observed over the period 1999–2007, this paper provides a fine‐grained analysis of the moderating effects of the two organizational mechanisms. The involvement of external consultants in R&D activities strengthens the impact of inbound open innovation on innovation performance by increasing marginal benefits of acquiring external technological knowledge through R&D outsourcing. Moreover, it reduces the level of inbound open innovation to which the highest innovation performance corresponds. Instead, the existence of a dedicated R&D unit makes the firm less sensitive to changes in the level of inbound open innovation, by reducing marginal benefits of acquiring external technological knowledge through R&D outsourcing, and increases the level of inbound open innovation to which the highest innovation performance corresponds. The results regarding the role of informal and formalized R&D organizational mechanisms contribute to research on open innovation and absorptive capacity, and also inform managers as to what organizational mechanism is recommended to acquire external technological knowledge, depending on the objectives that the firm pursues.     

Understanding the Antecedents,Contingencies, and Performance Implications of Process Innovation: A Dynamic Capabilities Perspective

This paper examines one of the most important sources of competitiveness in dynamic industries—the capability of firms to introduce process innovations. While the management of product innovation has received considerable theoretical and empirical attention in the literature, our knowledge about how firms become process innovators—and why many firms fail to do so—remains underdeveloped. In order to provide novel insights into the configuration of firms' process innovation activities and their performance implications, this paper draws on the dynamic capabilities approach. More specifically, this study aims to shed light on the antecedents, contingencies, and performance consequences of interfirm differences in process innovation success, that is, firms' propensity and effectiveness of implementing new production, supply chain, or administrative processes. Particular emphasis is placed upon the analysis of potential complementarities or substitution effects between innovation activities such as internal and external research and development, prototyping, external knowledge acquisition, and employee training. Cross‐sectional data from a large‐scale survey of German manufacturing and service firms serves as the basis for testing the hypotheses advanced in this paper. Findings suggest that by engaging in a broad range of different innovation activities, firms can indeed increase the likelihood of achieving process innovation success, which is in turn positively related to firm financial performance. Yet decreasing marginal returns to innovation activities have to be considered as process innovation propensity was found to increase with the number of activities pursued simultaneously only up to a point, after which negative marginal returns set in (inverted U‐shaped relationship). Furthermore, while environmental turbulence was found to have surprisingly little influence when it comes to translating process innovation success into firms' subsequent financial performance, industry membership as well as the nature of the innovation process (i.e., internal generation, external adoption, or cocreation of an innovation) emerged as key contingency factors. These findings have important theoretical as well as practical implications for managing new process introductions.     

Coopetition and product innovation performance: The role of internal knowledge sharing mechanisms and formal knowledge protection mechanisms

Coopetition is an important new product development strategy; yet, studies addressing the impact of collaboration with competitors on product innovation performance provide mixed evidence. Conducting Tobit analyses on a sample of 627 manufacturing firms that responded to the fifth wave of the Flemish Community Innovation Survey, we find that the innovation performance implications of competitor collaboration depend on fine-grained intra-organizational design characteristics. In particular, our results show that competitor collaboration has a significant positive impact on product innovation performance only when internal knowledge sharing mechanisms and formal knowledge protection mechanisms are present. These findings contribute to the emerging contingency perspective on coopetition and provide specific recommendations to managers that are involved in coopetitive endeavors.     

Industrial Companies' Evaluation Criteria in New Product Development Gates

This article presents the results of a study on the evaluation criteria that companies use at several gates in the NPD process. The findings from 166 managers suggest that companies use different criteria at different NPD evaluation gates. While such criteria as technical feasibility, intuition and market potential are stressed in the early‐screening gates of the NPD process, a focus on product performance, quality, and staying within the development budget are considered of paramount importance after the product has been developed. During and after commercialization, customer acceptance and satisfaction and unit sales are primary considerations. In addition, based on the performance dimensions developed by Griffin and Page (1993), we derive patterns of use of various evaluative dimensions at the NPD gates. Our results show that while the market acceptance dimension permeates evaluation at all the gates in the NPD process, the financial dimension is especially important during the business analysis gate and after‐market launch. The product performance dimension figures strongly in the product and market testing gates. The importance of our additional set of criteria (i.e., product uniqueness, market potential, market chance, technical feasibility, and intuition) decreases as the NPD process unfolds. Overall the above pattern of dimensions' usage holds true for both countries in which we collected our data, and across firms of different sizes, holding different market share positions, with different NPD drivers, following different innovation strategies, and developing different types of new products. The results also are stable for respondents that differ in terms of expertise and functional background. The results of this study provide useful guidelines for project selection and evaluation purposes and therefore can be helpful for effective investment decision‐making at gate‐meetings and for project portfolio management. We elaborate on these guidelines for product developers and marketers wishing to employ evaluation criteria in their NPD gates, and we discuss directions for further research.     

An Empirical Study of Platform and Derivative Product Development Projects

Many firms now realize the importance of planning product families and product platforms. However, little research addresses planning and execution of different types of projects within a product family platform series. This study investigates project characteristics, development challenges, typical outcomes, and success factors for product development projects at different locations in the product family spectrum. “Platform” projects result in products that initiate a new product family platform for a company. “Derivative” projects result in products consisting of extensions to an existing product family platform. Data on 108 new product development projects from a variety of assembled products industries were collected via a detailed survey and analyzed. Findings indicate that: (1) platform and derivative projects differ in project task characteristics (including the amount of new technology development undertaken and project complexity) and market newness; (2) platform and derivative projects generally do not differ in terms of project success (achievement of project objectives, level of company satisfaction, and perceived customer satisfaction) or smoothness of project execution; (3) both platform and derivative projects generally are executed in similar ways; (4) certain managerial approaches (including contingency planning, project-based evaluation of personnel, and overlap of design and manufacturing engineering) are associated with higher project execution success for both platform and derivative projects; and (5) use of interdependent technologies and novel project objectives are associated with project execution failure for platform projects. The results suggest that firms can continue to employ a single product development management process for both platform and derivative projects, as long as modest customization of the process is made for the given project type. Completely different management processes are not required. In all, the results presented in this article suggest specific managerial actions companies can take to significantly improve product development success. © 1999 Elsevier Science Inc.     

Developing an expert system on project evaluation: Part 1: Structuring the expertise

This paper reports interim results obtained from research on the development of an expert system originally intended to be advisory to managers at all levels of R&D on the selection of projects. Whilst diversity had been expected, when the 'Experts' were consulted, there was a total absence of agreement as to how projects were selected.
This led to a shift in objectives. The first shift was from project selection to project evaluation which was identified as the real activity which managers undertook in conditions where the number of projects was likely to exceed the resources available. The second was to try to classify projects such that projects in one class might have similar criteria for evaluation
In pursuit of these new objectives, the rigorous thinking necessary to structure the guidance of the 'Experts' into an expert system gave new insights into the nature of projects themselves and their management in support of corporate strategy. This paper sets these out and will be followed by Pt. II which will report on structuring the actual Expert System, and Pt. Ill giving the details of the managerial approach and the decision support process of the actual expert system     

Should You Really Produce What Consumers Like Online? Empirical Evidence for Reciprocal Voting in Open Innovation Contests

In open innovation, firms increasingly rely on online consumer votes to evaluate ideas for new products and services. Votes can represent cost‐effective external information about idea quality that can inform and facilitate a firm's task of evaluating and screening of ideas at the early stages of the innovation process. Challenging this perception, we proposed that consumer votes provided in open innovation contests can be socially biased by reciprocal voting. On the basis of theories related to cooperation and social influence, we argued that both gregarious consumers (those who solicit social ties) and consumers who initiate direct reciprocity (those who vote for others) signal a willingness to cooperate that stimulates reciprocal voting from peers. We empirically investigated consumer voting behavior using a unique dataset with information obtained from actual open innovation contests in which consumers could submit their own ideas and see and vote for the ideas of others. We found that both gregariousness and the initiation of direct reciprocity positively influence votes received. Such cooperation pays off for consumers because firms indeed use votes to inform internal idea evaluations. We also found, however, that the votes an idea receives during an innovation contest cannot significantly explain its later revealed quality. Reciprocity may be an effective form of cooperation among consumers, but it has potentially negative implications for firms' evaluations. Our results also indicated that beyond reciprocity, consumers and firms value different types of ideas, which further differentiates their evaluations. Thus, firms should not only be aware of social biases in votes but also account for the diverging idea preferences of customers.     

Sustainability,Social Media Driven Open Innovation,and New Product Development Performance*

Sustainability and social media use in open innovation play important roles in a firm's new product development (NPD) process. This research examines, in conjunction, the roles of sustainability and social media driven inbound open innovation (SMOI) for a firm's NPD performance, and further, takes a more refined approach by differentiating between different types of SMOI activities. To this end, this research develops and tests a conceptual framework, which predicts that (1) a firm's sustainability orientation (SO) is positively associated with its NPD performance, (2) customer focus (CF) partially mediates the SO–NPD performance link, and (3) particular SMOI activities moderate the CF–NPD performance link. The empirical results, using data from the Product Development and Management Association (PDMA)'s comparative performance assessment study, provide support for most of the framework. Notably, this research documents a positive link between SO and NPD performance, as well as a partial mediating role of CF. The results further suggest that social media driven open innovation activities focused on gathering market insights enhance CF directly, while social media driven open innovation activities that garner technical expertise enhance the link between CF and NPD performance. This paper bridges the separate literatures on sustainability and open innovation, and contributes to the NPD research. The findings suggest that managers should take a strategic approach to sustainability and embed it in the NPD process. Furthermore, managers should manage social media based open innovation carefully to fully benefit the firm during the front end and back end of NPD.     

CEOs’ Transformational Leadership and Product Innovation Performance: The Roles of Corporate Entrepreneurship and Technology Orientation

Product innovation is an important research topic that has stimulated significant interest among management scholars and practitioners. Leadership has been suggested to be a critical factor affecting product innovation. Numerous studies have documented that transformational leadership positively influences product innovation performance, which is conceptualized as the degree to which a new product and/or service has achieved its market share, sales, rates of asset return, rates of investment return, and profit objectives. However, there is a lack of studies examining the specific means through which transformational leadership influences product innovation performance at the firm level. Therefore, this study aimed to investigate the processes through which such effect is achieved and to determine whether corporate entrepreneurship and technology orientation as intervening factors influence this effect. To test the hypotheses, data were collected from 151 matched top management team (TMT) members and chief executive officers (CEOs) from Chinese manufacturing firms. Two separate questionnaires were used to collect the data. TMT members’ questionnaire included measures of CEO's transformational leadership, whereas CEOs’ questionnaire included questions about corporate entrepreneurship, technology orientation, and product innovation performance. Hierarchical linear regression was used to test the hypothesized effects. The results of the analysis provided the support for the fully mediating role of corporate entrepreneurship on the relationship between CEOs' transformational leadership and product innovation performance. In addition, technology orientation was found to significantly moderate the CEOs' transformational leadership–corporate entrepreneurship linkage. Furthermore, the mediated moderation effect of corporate entrepreneurship on the relationships among CEOs’ transformational leadership, technology orientation, and product innovation performance was significantly supported. By studying leadership among CEOs, this study contributes to the research by elucidating the mechanisms through which transformational leadership influences product innovation performance. The mediating role of corporate entrepreneurship encourages managers to improve their leadership style so as to enhance the development of corporate entrepreneurship and innovation practices. The findings also show that technology orientation provides the conditions for the smooth translation of the CEO's transformational leadership into actual entrepreneurial activities. Hence, firms should prioritize technology orientation to optimize the implementation of transformational leadership so as to emphasize innovation and new venture creation.