A tango with a gorilla: An exploration of the microfoundations of open innovation partnerships between young innovative companies and multi-national enterprises

Abstract

Our purpose is to clarify the microfoundations of open innovation (OI) in young innovative companies (YICs) in partnering with large multi-national enterprises (MNEs). Despite the progress in OI SME research, YICs remain understudied, and we know little about the nuances and complexity of how OI is managed. Through a qualitative research design, we explore four cases and twelve projects within the information communications technology (ICT) and medical device (MD) industries. Based on an analysis of primary and secondary data at the OI project level, we reveal five types of micro-foundations. These microfoundation types include YIC antecedent, YIC behaviour, MNE antecedent, MNE behaviour and joint action – which are found to influence the outcome of an OI project between an YIC and an MNE. These microfoundation types are deemed as either enabling (positive impact on the YIC OI project outcome) or limiting (negative impact on the YIC OI project outcome). The captured evidence asserts that is the lower-level activities both antecedents and behaviours that ultimately influence and shape the OI project and thus the innovation outcome. This study advances the OI literature and clarifies how the aggregation of this wide range of microfoundations – both antecedents and behaviours, shapes the OI project outcome. Our research illustrates that the deliberate management of microfoundations is a necessary constructive element in an OI project between an YIC and an MNE. Microfoundations provide a guiding rail for YICs to reflect, learn and create value.