Abstract
Most innovation activities that are inevitable for sustainable growth are coordinated via research and development (R&D) projects, which can differ widely in terms of both project and open innovation characteristics, even when conducted within the same firm. Therefore, it is important to consider the peculiarities of R&D projects when evaluating the performance of open innovation strategies, as well as to explore how the benefits and costs of open innovation are shaped by cross-level interactions. This study identifies the differences between successful and unsuccessful open innovation projects, in both firm-level and project-level terms. We focus on small and medium enterprises (SMEs), which usually lack the full set of internal resources and competences required to effectively develop, produce, and commercialize their innovations, and thus must adopt open innovation approaches more actively for sustainability. Adopting an empirical approach, we conducted a survey of 517 Korean SMEs and analyzed 241 successful and unsuccessful open innovation projects in depth. By combining measurements at the firm and project levels, this study provides new insight into the intra-organizational challenges of implementing open innovation projects, which are not only helpful to strategic decision-makers in SMEs, but also to those who make policies for them.
Highlights
The last two decades have seen fundamental changes in how firms undertake innovation activities for sustainable growth, among which is the tremendous increase in the use of external networks [1,2]
These are the open innovation” (OI) practices that are relatively easy for small and medium enterprises (SMEs) to adopt, considering the transaction costs and potential risks anticipated from general OI practices; SMEs value these practices highly
They claimed that the financial performance of research and development (R&D) projects with OI partnerships are affected by how they are managed: appropriate management produced better performance, and science-based partnerships are positively correlated with project performance for loosely managed projects, whereas market-based partnerships are only correlated with project performance for structured formal project management
Summary
The last two decades have seen fundamental changes in how firms undertake innovation activities for sustainable growth, among which is the tremendous increase in the use of external networks [1,2]. Chesbrough and Bogers (2014) suggested a list of possible units of analysis that may offer a more fine-grained framework for OI research: (1) intra-organizational; (2) organizational; (3) extra-organizational; (4) inter-organizational; (5) industry; (6) regional innovation system; and (7) society [7]. Among these levels of analysis, this research focuses on the intra-organizational level, on the project level. Despite the massive interest in OI, scant attention has been paid to project-level analyses, with a few exceptions (e.g., [9,11])
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