Developing a coevolutionary account of innovation ecosystems

Whilst research in innovation ecosystems has focused on the connectivity, interdependence, and coevolution of actors, technologies, and institutions, there has been a gap in the study of these relationships between actors, with little explanation given on how mutually interdependent parties adapt. In this paper, we draw further on the ecological metaphor to present a view of innovation ecosystems as complex adaptive systems, where patterns of change emerge from microlevel coevolutionary interactions between actors. Drawing on this view, we explore related implications for our understanding of ecosystem boundaries, coevolutionary rules of interaction, and how ecosystems are energized through innovation. Specifically, we contribute to the literature by developing a novel account of innovation ecosystems where actors are bound together through changing modes of coevolution. Drawing on this account, we explore key theoretical and practical implications for our understanding of ecosystem actors, rules of interaction, and the wider innovation ecosystem. We conclude that innovation both maintains and drives change within the innovation ecosystem, by altering the microlevel rules of interaction and coevolutionary relationships between actors.     

Intellectual evolution of social innovation: A bibliometric analysis and avenues for future research trends

Despite the fact that the concept of social innovation is extensively employed by scholars and practitioners, yet the conceptualisation and the research structure remained fragmented and scattered, because no rigorous attempt has been made to understand the core concept of social innovation. The notion of social innovation is multi-faceted and multi-disciplinary fluctuating from public-policy to environmental sustainability; which makes an investigation of the concept essential for business-to-business practitioners and scholars. By processing 370 publications from a sample of 125 journals and books with a total of 2941 citations, the authors unpack/unfold the intellectual foundation of social innovation in business and management domains by performing four bibliometric analyses and they evaluate the research domain qualitatively (1970–2019). By using co-citation, network visualisation through co-occurrence data, multi-dimensional scaling, and hierarchical cluster analysis, this research sheds light to the intellectual structure of social innovation including social value, economic value, societal impact, and bifocal innovations. This research reveals the key research clusters embodied by social innovation foundation. The present study identifies four important components for the future avenues of social innovation (i.e. opportunity, innovation practice, opportunity exploiter, value), and proposes a potential research framework to the researchers and practitioners, hoping to provide insights on social innovation.     

Is the value created necessarily associated with money? On the connections between an innovation process and its monetary dimension: The case of Solibro's thin-film solar cells

While IMP research has implicitly identified the intricate and unfair connection between innovation and its monetary dimension, there is a lack of studies which explicitly focus on this connection. Consequently, there is also a lack of concepts with which to investigate the role of money and its connections with other resources in the business landscape. This paper aims to contribute to an increased understanding of this phenomena, by explicitly investigating the connection between the social-material and the monetary dimensions of an innovation journey. We analyze a case study on new type of thin-film solar cells; an innovation journey in which both the social-material and monetary dimensions involve public and private actors and transcend national borders. We identify five key connections between social-material resources and the monetary dimension: (1) Monetary flows finance new resource combinations; (2) the monetary dimension evaluates social-material resources, even though it does so in highly subjective, erratic and negotiated ways; (3–4) business deals and monetary flows both enable and block actions on social-material resources; and (5) business deals distribute, although very unevenly, the costs and benefits of social-material resources among the involved actors.     

Make,buy, organize: The interplay between research,external knowledge,and firm structure

We bridge current streams of innovation research to explore the interplay between R&D, external knowledge, and organizational structure—three elements of a firm's innovation strategy, which we argue should logically be studied together. Using within‐firm patent assignment patterns, we develop a novel measure of structure for a large sample of American firms. We find that centralized firms invest more in research, and patent more per R&D dollar, than decentralized firms. Both types access technology via mergers and acquisitions, but their acquisitions differ in terms of frequency, size, and integration. Consistent with our framework, their sources of value creation differ: while centralized firms derive more value from internal R&D, decentralized firms rely more on external knowledge. We discuss how these findings should stimulate more integrative work on theories of innovation. Copyright © 2013 John Wiley & Sons, Ltd.     

Organizing coopetition for innovation: The case of wireless telecommunication sector in Europe

Prior research highlighted the prevalence of coopetition as a strategy for innovation in high-tech industries for several reasons but the link between forms of coopetition and innovation is still understudied. In order to fill this gap in the literature, this study attempts to answer the following question: which form of coopetition favors which type of innovation? The results of an embedded case study approach of five Celtic-Plus projects (European Eureka Program) in the wireless telecommunication sector show that two forms of coopetition exist: multiple and dyadic. While multiple coopetition is successfully pursued for radical innovation, dyadic coopetition is more suitable for incremental innovation. Different innovation objectives lead to different levels of value creation/appropriation tensions between coopetitors. In order for competitors to pursue radical or incremental innovation successfully, different levels of social capital related to different choices of partners are needed. The role of social capital levels as a moderating factor between value creation/appropriation tensions and innovation type is discussed in detail. The study proposes a conceptual model that links coopetition strategy motives to the types of coopetition and their results in terms of radical or incremental innovation. Finally, a framework that helps firms to balance between multiple/dyadic–vertical/horizontal collaboration according to the levels of value creation/appropriation tensions and social capital is proposed.     

Open innovation: Are inbound and outbound knowledge flows really complementary?

One novel implication of the open innovation paradigm is that inflows and outflows of knowledge are complementary. We argue that engaging simultaneously in buying and selling knowledge should allow firms to increase innovation outcomes. At the same time, we identify some of the relevant costs (cognitive, transaction, and organizational costs) that “open” firms can reduce by combining knowledge inflows and outflows. Empirically, however, we find no evidence for such complementarity in a sample of Belgian manufacturing firms. Firms buying and selling knowledge do increase their sales of new products, but at the same time their R&D costs increase more than proportionally. Our findings, therefore, indicate the need for research into a better understanding of the drivers of actual costs of organizing for open innovation. Copyright © 2015 John Wiley & Sons, Ltd.     

Technology versus Design Innovation's Effects on Sales and Tobin's Q: The Moderating Role of Branding Strategy

This research investigates the impacts on firm performance of (1) technology versus design innovation and (2) their potentially synergistic interaction. Synergies could arise from complementarities, in particular the utilization of technology innovation as a platform for design innovations. Both sales and Tobin's q are examined as dependent performance variables, with sales tapping consumer responses and Tobin's q reflecting investor responses. Moderation by branding strategy (i.e., Corporate Branding versus Mixed Branding versus House of Brands) is analyzed because innovation may impact performance differently depending on branding strategy. Advertising effects, the number of new product introductions, their interaction, R&D expenditures, operating margins, and firm size are also modeled as covariates. The results show that all main and interaction effects are significant in at least one of the branding groups, and that moderation of model paths by branding strategy was pervasive. Overall, except for technology innovation → Tobin's q, Corporate Branding coefficients for technology innovation, design innovation, and their interaction were almost always significantly different from Mixed Branding and House of Brands coefficients, which were not significantly different from each other. Since Mixed Branding and House of Brands proved very similar, these groups were combined under “Non‐Corporate.” First, for technology innovation, the impact on both sales and Tobin's q for Corporate Branding was less than or equal to Noncorporate. Noteworthy was that the technology innovation → Tobin's q relationship was equal across all branding strategies; technology innovation appears to be key for investors. Second, for design innovation, the impact for Corporate Branding was positive while for Noncorporate it was null; the same pattern was observed for sales and Tobin's q. Third, for the interaction, the impact for Corporate Branding was significantly less than the positive impacts for Noncorporate. For Noncorporate, the marginal impact of design innovation on sales or Tobin's q increased with the level of technology innovation. For Corporate Branding however, there was no interaction in the case of sales and a negative interaction for Tobin's q. Thus, the marginal impact of design innovation on Tobin's q decreased with increasing levels of technology innovation. These decreasing marginal effects could reflect limits to corporate brand name extensions, as perceived by investors.     

Giving fish or teaching to fish? An empirical study of the effects of government research and development policies

This study compares how government research and development (R&D) subsidy and knowledge transfer from universities and public research institutions stimulate a firm's new product development. More importantly, we emphasize that the effects of these governmental R&D policies on new product development can be achieved not only directly, but also via a mediating role – a firm's innovation capability. Furthermore, we test how other external knowledge sources (such as knowledge from universities and public research institutions) interact with government R&D support to stimulate new product development. The results, based on an investigation of 270 Chinese firms, suggest that both government R&D subsidy and knowledge transfer from universities and public research institutions enhance new product development. The results also show that although government R&D subsidy and knowledge transfer from universities and public research institutions has a direct impact on new product development, innovation capability does mediate the above relationships. Moreover, unlike the findings that other external knowledge sources have a direct influence on new product development as indicated by the previous literature, our findings suggest that external knowledge sources substitute with the government R&D subsidies and complement with knowledge transfer from universities and public research institutions. The results confirm the old sayings that teaching to fish (knowledge transfer from universities and public research institutions can complement with other external knowledge sources) is much better than giving fish (government R&D subsidies substitute other external knowledge sources). This paper enriches current literature of government R&D support policies to firm new product development by providing empirical evidences.     

A reasoned action perspective of user innovation: Model and empirical test

Much research in the field of user innovation has followed two theoretical perspectives — the cost–benefit framework and the community perspective of user innovation. By adopting the theory of reasoned action (TRA) into the context of user innovation, this study establishes an integrative theoretical framework to accommodate both the cost–benefit perspective and the community perspective of user innovation. This TRA-extended framework embraces both the direct and the interactive influences of the cost–benefit factors (the perceived effort in innovation and the perceived benefit from innovation), the individual characteristics (personal innovativeness and experience) and the social interactions (the perceived social influence) in shaping user innovation at the individual level. The empirical results support the proposed theoretical model. The results also reveal that the moderating effect of experience (or perceived effort) on the intentional component of user innovation is different from the effect on the behavioral component of user innovation.     

Business model innovation and decision making: uncovering mechanisms for coping with uncertainty

As a research subject, business model innovation spans the strategy, innovation, and entrepreneurship fields. Yet, despite the importance of the concept, prior work has paid little attention to how decision-makers cope with uncertainty and gain understanding about interdependencies in new business model configurations. To address this gap, we combine top-down theorising and evidence-based exploration and seek to unpack some of the coping mechanisms that operate in the evolutionary view of business model innovation. Using in-depth interviewing to collect data, our study reveals five strategies – customer centricity, value co-creation, capability evolution, ecosystem growth, and adaptive pricing – that decision-makers apply to cope with uncertainty in business model innovation. We find that coping mechanisms support decision making during the development of new business models. Furthermore, we find that the five coping strategies delineate decision making for value proposition, value creation, and value capture configurations in more detail than existing literature has described. Our findings have important implications for decision making in business model innovation.     

Design,Meanings, and Radical Innovation: A Metamodel and a Research Agenda*

Recent studies on design management have helped us to better comprehend how companies can apply design to get closer to users and to better understand their needs; this is an approach usually referred to as user‐centered design. Yet analysis of design‐intensive manufacturers such as Alessi, Artemide, and other leading Italian firms shows that their innovation process hardly starts from a close observation of user needs and requirements. Rather, they follow a different strategy called design‐driven innovation in this paper. This strategy aims at radically change the emotional and symbolic content of products (i.e., their meanings and languages) through a deep understanding of broader changes in society, culture, and technology. Rather than being pulled by user requirements, design‐driven innovation is pushed by a firm's vision about possible new product meanings and languages that could diffuse in society. Design‐driven innovation, which plays such a crucial role in the innovation strategy of design intensive firms, has still remained largely unexplored. This paper aims at providing a possible direction to fill this empty spot in innovation management literature. In particular, first it proposes a metamodel for investigating design‐driven innovation in which a manufacturer's ability to understand, anticipate, and influence emergence of new product meanings is built by relying on external interpreters (e.g., designers, firms in other industries, suppliers, schools, artists, the media) that share its same problem: to understand the evolution of sociocultural models and to propose new visions and meanings. Managing design‐driven innovation therefore implies managing the interaction with these interpreters to access, share, and internalize knowledge on product languages and to influence shifts in sociocultural models. Second, the paper proposes a possible direction to scientifically investigate the management of this networked and collective research process. In particular, it shows that the process of creating breakthrough innovations of meanings partially mirrors the process of creating breakthrough technological innovations. Studies of design‐driven innovation may therefore benefit significantly from the existing body of theories in the field of technology management. The analysis of the analogies between these two types of radical innovations (i.e., meanings and technologies) allows a research agenda to be set for exploration of design‐driven innovation, a relevant as well as underinvestigated phenomenon.     

Creating incentives for innovation? The relationship between pay dispersion in R&D groups and firm innovation performance

Innovation is a critical organizational outcome for its potential to generate competitive advantage. While the contribution of knowledge workers to the generation of innovation is widely recognized, little is known about how organizational incentive mechanisms stimulate or inhibit these workers' behaviors that promote innovation. This study examines the relationship between pay dispersion in R&D groups and firm innovation using employee‐level compensation data in US high‐technology firms. The results show that (1) pay dispersion in R&D groups is negatively related to firm innovation and (2) this negative relationship is alleviated in firms with greater financial slack. This study contributes to the innovation literature by illuminating the implications of organizational incentive systems for successful innovation. Copyright © 2013 John Wiley & Sons, Ltd.     

Exploring the contribution of innovation intermediaries to the new product development (NPD) process: a typology and an empirical study

In the ‘knowledge economy’ upheld by the European Lisbon strategy, knowledge‐intensive services are considered a key driver for innovation and competitiveness. A category of knowledge‐intensive services that has become of utmost importance in the last few decades is new product development (NPD) services, which interconnect distant knowledge domains with the client firms. In addition to NPD service providers, web‐based innovation intermediaries have started to help innovative firms access dispersed bodies of knowledge. Despite the heterogeneity of their characteristics, however, a clear typology of the strategies used by traditional NPD service providers and web‐based intermediaries to interact with their knowledge sources and with their clients is missing. This typology would be very useful for those firms that are willing to collaborate with innovation intermediaries because it could highlight the typologies of NPD problems different intermediaries are apt to address and the managerial challenges that working with them entails. Developing such a classification framework is the main goal of this paper. The typology proposed in this paper suggests that innovation intermediaries should be distinguished based on the following: (1) the way they access their distributed knowledge sources and (2) the way they deliver value to their clients. By combining these two dimensions, four categories of innovation intermediaries are identified, which are named brokers, mediators, collectors and connectors. A multiple case study analysis involving four innovation intermediaries and 12 of their clients is presented in the paper. The analysis provides exploratory insights into (1) the typologies of NPD problems that each class of intermediaries addresses and (2) the managerial challenges that working with each of them entails. These preliminary findings call for further theoretical and empirical research into the complex interaction among innovation intermediaries, their dispersed sources of knowledge and their clients.     

Ambidextrous balance and channel innovation ability in Chinese business circles: The mediating effect of knowledge inertia and guanxi inertia

Drawing on organizational learning theory and literature on guanxi, this study examines how and why ambidextrous learning balance influences firm innovation capability in Chinese business circles. We propose a U-shaped relation between ambidextrous learning balance and firm innovation capability which is mediated by guanxi inertia and knowledge inertia in different ways. Specifically, ambidextrous learning balance has an inverted U-shaped impact on guanxi inertia and further influences firm innovation capability. Whereas, ambidextrous learning balance has a linear positive influence on innovation capability through a decreased level of knowledge inertia. Based on survey data collected from, The results obtained from a sample of 197 Chinese channel enterprises using SEMs analysis provide strong support for our hypotheses. In addition, the findings based on firms with unbalanced ambidextrous learning indicate that as opposed to exploratory learning, higher level of exploitative learning leads to an increase in guanxi inertia and a decrease in knowledge inertia. These conclusions reveal how ambidextrous learning balance influence innovation capability for a firm with inherent learning preference which is not discussed by the extant research. At the same time, this study fills the gap of ambidextrous learning balance by considering the influence of culture. Our work also informs foreign practitioners of the optimal ways of learning for innovation in China.     

Standards,consortia, and innovation

The development of formal ICT standards is a challenging form of collaborative innovation, combining consensus decision making and R&D rivalry. To supplement this formal standard setting process, it has thus become frequent that part of the involved firms creates ad hoc consortia to better align positions on a common technology roadmap. This paper aims to assess whether such consortia can effectively mitigate R&D coordination failure through enhanced cooperation. We first develop a theoretical model showing that depending on the nature of firms' incentives to contribute proprietary technology, different types of R&D coordination failure – namely a Public Good or Rent Seeking problem – may occur in equilibrium. Using a large panel of standards, we then confirm empirically the prediction that consortia have different effects on innovation under a Public Good or Rent Seeking regime. Overall, we observe an increase in innovation after a firm joined a consortium. However, this effect is significantly weakened or even reversed for standards characterized by a strong Rent Seeking regime.     

How functional involvement affects the transformation of external knowledge into innovation outcomes

This paper aims at investigating organizational mechanisms through which firms involved in open innovation initiatives can acquire external knowledge, integrate it with the existing one residing in the diverse functional areas, and transform it into innovation outcomes. Following the knowledge transformation perspective, we use the notions of early‐stage and late‐stage functional involvement, and explain their mediating effects on a firm's innovation performance. Based on a sample of 131 international firms involved in open innovation projects, we find that high involvement of functions related to the early stage of the innovation process – notably new concept generation, research and development, and design and testing – fully mediates the effect of external knowledge transfer on innovation performance. Similarly, high involvement of functions related to the late stage of the innovation process – notably manufacturing, marketing, distribution, and logistics – has significant indirect effect on innovation performance but lower than that of early‐stage functional involvement. Furthermore, the empirical research reveals that early‐stage functional involvement mediates the positive effect of external knowledge transfer on late‐stage functional involvement. Theoretical and practical implications of our findings are discussed.     

Where to search for process innovations? The mediating role of absorptive capacity and its impact on process innovation

While the potential of open innovation to develop product-related improvements through the use of external knowledge sources is undeniable, our understanding of how firms become process innovators remains limited. Distinguishing between product and process innovation is important, as insights gleaned from investigating product innovation may not relate directly to the study of process innovation. This study provides new insight into open innovation and absorptive capacity by proposing the mediating role of absorptive capacity – potential and realized – on the relationship between knowledge search from external sources and process-related innovation activities. We test our model using a sample of 171 auto component suppliers in Iran, and find evidence that the learning effects of external scanning increase when a firm learns how to better manage external searches in terms of external absorptive capacity routines. Our results indicate that, while knowledge search from value chain partners is related to process innovation, knowledge search from universities and other research organizations is not, and that potential absorptive capacity mediates the relationship between external knowledge search and process innovation. These findings shed further light on the relationship between a firm’s openness and its process innovation.     

Principles of innovation to build nutrition-sensitive food systems in South Asia

Innovations within global food systems have contributed to the predicament known as the triple burden of malnutrition – the co-existence of hunger and micronutrient deficiency with the diseases of overnutrition, such as obesity, diabetes and hypertension. We use the case of the triple burden in South Asia to demonstrate analytically that innovation is a double-edged sword, with positive and negative potential, rather than a simple good. To achieve the Sustainable Development Goals that target food and nutrition security and sustainable agriculture (e.g. SDGs 2, 3 and 12), the countries of South Asia need more innovation, but, first, they would also benefit from some intelligent reflection about what innovation means, the directions it should take, and its risks and downsides alongside its benefits. In the present juncture, South Asian countries have an opportunity to learn from the experiences of other developing nations, and choose from alternative options to steer their own course. In this paper, we discuss how innovation has contributed to the present situation and ask how alternative kinds of innovation may enable South Asian countries to escape from the triple burden. We describe a conceptual framework that may be useful for thinking about how innovation pathways can be created and directed towards the goal of improving nutritional outcomes in South Asia. The framework draws attention to the direction of socio-technical change, the distribution of technologies and their risks and benefits, and the diversity of possible innovation pathways (STEPS Centre, 2010). We illustrate these points using examples of innovations in the areas of agricultural production, value chain interventions, and policy and institutional reforms.     

Institutional adversity,external knowledge sources,and new ventures' innovation: An institutional polycentrism theory perspective

Why do some new ventures thrive while others fail? In this study, we investigate the unique relationship between external knowledge sourcing of new ventures and its innovative outcomes, and its contextual embeddedness. The investigation is based on the Knowledge-based view and theory of institutional polycentrism across entrepreneurs, nested in different institutional contexts. Our framework generates hypothesis about the negative impact of higher levels of institutional adversity, on new venture's innovation at the national level. We then found the contingent role of adversity in institutions based on the relationship between external knowledge sourcing and new venture innovation. We examine this question using data from 28,660 entrepreneurs from 47 countries. We use Global Entrepreneurship Monitor, Freedom House, IEF, POLCON and Political Risk Services data for 2009–2013. We apply multilevel estimation framework to test our hypotheses. We find the new ventures that have high level of external knowledge sourcing tend to be more innovative: the ones that search widely through different external sources. Further, we find that the benefits to external knowledge sourcing depend on institutional environmental conditions, however new venture innovation should ensure the external knowledge sourcing are used robustly to develop a resource mechanism to deal with the institutional adversity.     

Contingent contingency: Knowledge heterogeneity and new product development performance revisited

This paper re-conceptualizes the meaning of knowledge heterogeneity—an important but under-developed collective-level concept that influences innovation. The new conceptualization extends the construct of knowledge heterogeneity beyond the traditional assessments of variability in professional background. This research further explores the quadratic relationship between knowledge heterogeneity and new product development performance. Drawing on and synthesizing knowledge clarity and uncertainty avoidance literature to consider work context, the possibility of a positive quadratic, rather than a linear or a negative quadratic, relationship between knowledge heterogeneity and innovation is suggested. This relationship is explored using data collected from 128 new product development teams from companies in knowledge-intensive and innovation-oriented industries located in Taiwan. Results are discussed in terms of the hypothesized positive quadratic relationship. The outcome of the study is discussed in terms of the influence of the knowledge structure and cultural factors, which suggest potential contingent contingencies across different contexts.