Abstract
This paper addresses a major gap in reported research on open innovation (OI) literature: How do service firms adopt open innovation? This research focuses on data from eighteen service SMEs in Belgium from high-tech and knowledge-intensive service industries. Based on analysis, we find new insights regarding open innovation practices (i.e., inbound and outbound) and sub-practices (i.e., acquiring, sourcing, selling and revealing) for service firms. More specifically, the study showed that service SMEs are more inclined to use inbound practices due to reasons associated with firm size, industry, and knowledge intensity in the market, whereas the decision about which sub-practice to adopt seems to be strongly influenced by the type of actor, the firm’s vulnerability and internal managerial skills, and the existence of complementarities. Thus, we contribute to OI literature as well as capability literature through providing initial insights regarding the adoption of OI by service firms.
Highlights
Service innovation management in current hypercompetitive markets are considered to be important challenge for many service firms
Our results reveal that the services SMEs in our sample primarily integrate external resources for internal development
The ways in which service SMEs practice inbound open innovation (OI) were observed. These firms appear to practice the two processes linked to inbound practices: acquiring (“In this case, we collaborated by using a well-defined contract involving agreements concerning the terms of trade,”) and sourcing (“ (...) by discussing with a potential partner, we discover that it was possible to work together in a less formal way as each one borrows something crucial for the innovation project”)
Summary
Service innovation management in current hypercompetitive markets are considered to be important challenge for many service firms. This challenge is due to need to simultaneously consider multiple interrelated changes, such as organizational innovation, the involvement of multiple actors in the process of innovation, and the codification of knowledge for innovation. Some service companies (mostly technology-based businesses) have been trying to break their boundaries through implementing a more open innovation processes. The emerging literature on open innovation (OI) captures such developed and is defined as “the use of purposive inflows and outflows of knowledge to accelerate internal innovation and expand the markets for [the] external use of innovation, respectively” (Chesbrough 2006; Chesbrough 2006). Using OI, service firms can overcome barriers to ISSN 2183-0606 http://creativecommons.org/licenses/by/3.0
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