The effect of technology-exploration on product innovation: an analysis based on Korean manufacturing SMEs

Hojin Lee,Heejun Park,Sangyoon Cha

doi:10.1186/s40887-016-0009-y

Hojin Lee, Heejun Park + Show 1 more

Open Access

https://doi.org/10.1186/s40887-016-0009-y

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Abstract

AbstractToday, fierce competition drives firms in their continual efforts to introduce products with a higher degree of novelty into the market. There is a growing need to understand important activities so as to achieve product innovation. This empirical study demonstrates the effect of technology-exploration, including outsourcing R&D, external networking, customer involvement, and inward IP licensing, on product innovation, especially considering the degree of the novelty of the manufactured products. Using data from a sample of small and medium Korean manufacturing firms, our results show that technology-exploration are crucial determining factors as to whether low or higher degree of novelty is achieved in product innovation. The positive impact of higher degree of innovation novelty comes from customer involvement and outsourcing R&D. In addition, customer involvement has positive impact only on low degree of innovation. Other practices have no impact on either low or high degree of novelty in product innovation.

Highlights

When firms are seeking product innovation, they mainly rely on internal knowledge and technology, along with internal R&D competency, which can translates to competitiveness in the market
Manufacturing firms are subject to rapid technological changes and a constant need to innovate more quickly and in more novel ways compared to their competitors
We investigated the effects of technology-exploration, customer involvement, outsourcing R&D, external networking, and inward IP licensing, on product innovation in Korean manufacturing SMEs

Summary

Introduction

When firms are seeking product innovation, they mainly rely on internal knowledge and technology, along with internal R&D competency, which can translates to competitiveness in the market. The innovation environment have changed, making it is difficult for firms to achieve competitive product innovation using only the knowledge and technology obtained from internal R&D [2, 3]. Due to the rapid technological development and more diversified customer needs, firms can no longer dominate the market with only one product for a long period of time. To meet various customer needs and to adapt rapid changes in the market, firms have to capitalize on internal expertise and on all other available means, such as external knowledge and the convergence or integration of technology, in order to survive in the fast changing market [2, 4, 5].

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