The Contagious Power of Innovativeness: A Comparison of Different Types of Firm Partners

Abstract

Continuously innovating is known to provide firms with a competitive edge over rival firms. As innovations are often created in networks, a firm's partners exert an influence on the focal firm's innovative outcome. Although many studies deal with innovation networks and open innovation as a means to explore external knowledge and exploit knowledge externally e.g., dealing with characteristics of partnership agreements, there is virtually no research regarding characteristics of external partners. Namely, whether a focal firm's partners are innovative themselves and what the effects of this innovativeness on a focal firm's innovative outcome might be. This study considers different types of partners such as customers and suppliers and deals with the differential impact of partners` innovativeness on a focal firm's knowledge stock, absorptive capacity (ACAP), and innovation success. Drawing on literature on open innovation and ACAP and employing a survey in the manufacturing industry, we show whether a certain partner types' innovativeness is linked to innovation success, knowledge stock, and ACAP of a focal firm. E.g., we found that only the innovativeness of firms organized in clusters is positively and directly linked to innovation success, while customers' innovativeness influences positively and directly certain components of ACAP and knowledge stock.