External Technology Acquisition and External Technology Exploitation: The Difference of Open Innovation Effects

Farzana Parveen Tajudeen,Noor Ismawati Jaafar,Ainin Sulaiman

doi:10.3390/joitmc5040097

Farzana Parveen Tajudeen, Noor Ismawati Jaafar + Show 1 more

Open Access

https://doi.org/10.3390/joitmc5040097

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Abstract

To sustain in today’s ever-changing and competitive landscape, firms must work within and outside of their organizations’ boundaries. Open innovation (OI) strategies such as external technology acquisition (ETA), and external technology exploitation (ETE), can effectively improve the innovation performance of the organizations. Technologies like social media can help organizations to scout for appropriate technology, and source for ideas and knowledge from external sources to support their innovations. Moreover, digitalization can hasten business operations and enhance the innovation process of the firm. Focusing on open innovation (OI), this study takes an integrated approach towards investigating the impact of OI strategies, technology scouting through social media, and digitalization vision on innovation and firm performance. Data were drawn from 153 organizations in Malaysia, and the partial least squares (PLS) method was used to analyze data. The findings revealed that ETE, technology scouting through social media, and digitalization vision have a significant relationship with innovation performance. This, in turn, shows a positive relationship with firm performance. However, ETA does not have a significant relationship with innovation performance in the Malaysia context. This study extends the current literature on OI through the use of specific technology variables, such as technology scouting through social media and digitalization vision to support organizations’ innovation.

Highlights

Innovation is crucial for the development of a country’s economy, as each nation strives to be globally competitive, and this includes developing countries like Malaysia
A previous study [19] has investigated the impact of Open innovation (OI) on firm performance, but this study takes an integrated approach and investigates the impact of OI strategies (ETA and external technology exploitation (ETE)), technology scouting through social media, and digitalization vision on innovation performance and its subsequent impact on firm performance
The results showed that digitalization vision, technology scouting through social media, innovation performance

Summary

Introduction

Innovation is crucial for the development of a country’s economy, as each nation strives to be globally competitive, and this includes developing countries like Malaysia. Plans have been made to support this effort where the Eleventh Malaysia Plan [1] addressed this issue. It emphasized that productivity and innovation are the two most important pillars for the country to stimulate growth, thereby propelling the country’s economy towards higher progress. In this regard, businesses, firms, and organizations were encouraged to adopt the open innovation model as a strategy to develop open innovation (OI). Open innovation (OI) is the process of systematically encouraging and exploiting a wide range of internal and external knowledge sources for the purpose of accelerating innovation [3,4]

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