Outbound Open Innovation Research Articles

Cross-cultural strategic intelligence solutions for leveraging open innovation opportunities

Although the concept of open innovation has become widely discussed by scholarsand practitioners, few cross-cultural studies focus on the assessment of companies’ behaviourstowards “not invented here” and “not sold here” syndromes. The purpose of this paper is toinvestigate the profiles of Japanese and Romanian companies operating in two fields, IT andmanufacturing, from the open innovation perspective. The goal of this study is therefore toprovide comprehensive empirical evidence for the adoption of inbound and outbound openinnovation activities in the companies from these two target countries. Data from a sample ofJapanese companies and Romanian companies were used to test two hypotheses on openinnovation behaviour, in the context of a cross-cultural comparative approach. The results showthat technology isolationists are more frequently found among the Romanian companies(especially in the manufacturing field), than the Japanese companies, which can be explainedby the fact that Japanese firms are mainly based on leading innovative technologies, whileRomanian firms are early adopters of the advanced technologies, due to the economiccircumstances. Japanese companies included in the sample are defined as technology fountains,followed by technology brokers, proving their appetite for outbound open innovation. In thiscontext, strategic intelligence solutions, once performed in collaborative culture environments,will lead to the improvement of the partners’ managerial competences and will act as enablersfor competitive positioning, proving the added-value of the acquired know-how through openinnovation practices.

Open innovation: current status and research opportunities

Interest in open innovation (OI) as a field of research has grown exponentially since the phrase was coined by Chesbrough in his 2003 book, with numerous articles, special issues, books, and conference sessions. Various reviews of the literature have summarized prior work, offered new frameworks, and identified opportunities for future research. Here we summarize these opportunities, which include more research on outbound OI, the role of open innovation in services, and network forms of collaboration such as consortia, communities, ecosystems, and platforms. Research should also examine the use of OI by small, new, and not-for-profit organizations, as well as the linkage of individual actions and motivations to open innovation. Other opportunities include better measuring the costs, benefits, antecedents, mediators and moderators of the effects of OI on performance, and understanding why and how OI is rejected, abandoned, or fails. Finally, we consider how OI can be better linked to prior theoretical research, including topics such as absorptive capacity, user innovation, resources, dynamic capabilities, business models, and the definition of the firm.

Using transaction cost economics to explain open innovation in start-ups

Purpose The basic concept of transaction cost theory is that firms like to conduct transactions in a channel with lower transaction costs. Therefore, the purpose of this paper is to use the transaction cost perspective to identify which conditions cause companies to choose between outbound open innovation (hierarchy governance) and inbound open innovation (market governance). Design/methodology/approach Accordingly, transaction cost economics was used to relate the choice and implementation of open innovation using a sample of 250 electronics and information start-ups in China. Structural equation modeling was used to conduct confirmatory factor analysis to evaluate measurement model, while logistic regression analysis was used to test the hypotheses. Findings As expected, the dedicated asset specificity, human asset specificity, behavioral uncertainty, transaction frequency, and small number exchange were positively associated with outbound open innovation. Originality/value The contribution of this paper lies in explaining the role played by transaction cost economics in the process of open innovation for start-ups through empirical analysis.

Managerial ties and open innovation: examining the role of absorptive capacity

PurposeThe purpose of this paper is to develop and test an integrated model to examine the relationship between managerial ties and two types of open innovation (OI). It takes into account the mediating role of realized absorptive capacity and explains how a firm’s ability to recognize the value of new information, assimilate it and apply it to commercial ends can facilitate OI.Design/methodology/approachData were collected from 259 middle and top managers working across different sectors in the United Arab Emirates.FindingsResults obtained using structural equation modeling show that managerial ties facilitate both in-bound and out-bound OI. Results also establish the mediating role of realized absorptive capacity in these relationships.Research limitations/implicationsUse of cross-sectional data as was done in this study has been criticized for being inappropriate to test causal models. Besides the findings may not be generalizable to different industries/cultures/regions.Practical implicationsThis study suggests that managerial ties act to support OI in firms thus giving the insight that managers should be appreciated to build ties with managers of other firms, universities and government officials. Doing so can help firms achieve better OI outcomes. Firms should arrange means of interaction of their managers with these external knowledge sources such as events and occasions where managers of different firms can interact with each other to foster strong ties among them.Originality/valueThe above findings contribute theoretically to OI and managerial ties literature while providing insights for practitioners on how to succeed or avoid failure in their OI initiatives. These insights are novel and are new to the OI and managerial ties theory.

The link between organisational citizenship behaviours and open innovation: A case of Malaysian high-tech sector

We examine the role of organisational citizenship behaviours (OCBs) in two types of open innovation—inbound and outbound. Data were collected using the questionnaire survey technique from middle and top managers working in high-tech industries in Malaysia. Results show that OCBs positively predict both inbound and outbound open innovation. A closer look reveals that OCBs relate positively to out-bound open innovation in aggregate and in isolation. However, OCBs relate to in-bound open innovation in aggregate only. The implications of these results are discussed and limitations of the study are highlighted.

Exploring the impact of open innovation on firm performances

Purpose – The purpose of this paper is to explore the relationships between the openness of firms and their innovation and financial performances. Design/methodology/approach – In order to investigate such relationships, data on inbound and outbound open innovation (OI) processes and performances of 110 worldwide top research and development (R & D) spending bio-pharmaceutical companies are collected via the consolidated annual reports and the PATSTAT database. The time period of the analysis is 2008-2012. Findings – Regarding innovation performances, R & D productivity and revenues to patents ratio decrease with openness, whilst patents growth is not influenced by OI adoption. As to financial performances, sales growth exhibits a positive trend with openness, while operating profit and turnover decrease with OI adoption. Particularly, an inverted U-relationship with inbound and a U-shape one with outbound are observed as of operating profit. Research limitations/implications – The study adds to the knowledge about the effect of openness on firms’ performances, a topic of increasing interest to academics, managers and policy makers. Both inbound and outbound facets of the phenomenon are taken into account. Practical implications – Understanding how openness affects performances enables more informed decision making by managers, leading to a more effective use of OI activities. Originality/value – The work provides new insights as to what “being open” means for a company, gauging both inbound and outbound transactions after a pecuniary perspective. Employing objective and continuous measures, the relevance of OI for the whole business of firms can be identified.

Outbound Open Innovation for Enhanced Innovation Performance: An Empirical Study based on BTB Enterprises in China

Open Innovation gains a wide spread attention in technology management research in recent years. Because existing research about the relationship between outbound open innovation and innovation performance is limited and context factors are ignored in existing research and based on Chesbrough’s open innovation model and theory of enterprise competence, this study introduces enterprise competence and knowledge spillovers into the field of outbound open innovation, explores their moderated roles between open innovation and innovation performance. We use high-tech firms as research sample to test the hypothesis that we proposed and find that: (1) outbound open innovation has a positive effect on innovation performance; (2) both enterprise competence and knowledge spillovers moderate the relationship between outbound open innovation and innovation performance. These conclusions have important implications for the development and application of open innovation theory.

Proclivity for open innovation: Construct development and empirical validation

Over the past decade, the concept of open innovation has received substantial attention. Research has ranged from case study representations to large-scale quantitative studies using the Community Innovation Survey data or developing novel approaches to measuring open innovation. In this study, we conceptualise and validate a firm-level measure of proclivity for open innovation, which relates to the firm’s predisposition to perform inbound and outbound open innovation activities. To do so, we focus on smaller firms, assessing their organisational and behavioural perspectives related to open innovation. Building on existing scholarly research and a field study, we begin by conceptualising the theoretical framework of the multidimensional construct. We then develop and validate its measurement scale on two cross-cultural samples. The measure contains the following dimensions: inward IP licensing and external participation, outsourcing R&D and external networking, customer involvement, employee involvement, venturing, and outward IP licensing. Our results indicate that the measure has good reliability and validity. Implications for future research are also discussed.

Two-way open innovation and firm growth: the moderating effect of external environment

A few researchers have studied the relationship of open innovation and firm performance, but the results are controversial. One of the reasons for this inconsistence may be the ignorance of the impact on the external environment. Under the context of open innovation, innovation activities are divided into inbound open innovation and outbound open innovation. Based on a sample of 224 Chinese entrepreneurs from the Pearl River Delta and Yangtze River Delta, the relationship between the two kinds of open innovation and firm growth is discussed, and how this relationship is being affected by environment competitiveness (EC) and environment munificence (EM) is explored. Results show that both the inbound open and outbound open innovations have a positive effect on firm growth. Both EC and EM weaken the relationship between inbound open and firm growth. The study also finds a negative effect of both EC and EM on the relationship between outbound open innovation and firm growth significantly. Limitations and suggestions are proposed for future research on the implementation of open innovation under different circumstances.

The Effect of Organizational Structure on Open Innovation: A Quadratic Equation

Open innovation has recently begun to receive increasing attention in organizational research. Studies on open innovation have emphasized the impact of organizational structure on both inbound and outbound open innovation but have tended to focus on the former. This study attempts to provide a better understanding of open innovation within the context of open source by examining 2,811 projects, especially in GitHub. The analysis results reveal that the decentralization of decision-making encourages both inbound and outbound open innovation. The impact of the decentralization of decision-making differs between inbound and outbound open innovation, a finding that both scholars and practitioners must consider.

"Inbound Open Innovation, Outbound Open Innovation, and their Joint Effect on Firm Performance"

This study investigates the relationship between inbound and outbound open innovation activities. More specifically, drawing on a panel dataset of 322 European listed companies over a period of fiv...

A note on outbound open innovation and firm performance

The concept of open innovation has attracted a lot of interest over the past decade. In light of a relative emphasis on inbound open innovation (indicating an outside‐in process) in prior research, this brief note addresses the relationship between outbound open innovation (indicating an inside‐out process) and firm performance. In particular, it suggests that outbound open innovation may have positive and negative effects on firm performance based on potential benefits and risks of transferring technology. To what degree these effects materialize depends on internal factors, e.g. desorptive capacity, and external factors, e.g. appropriability. Consequently, a proficient internal management of outbound open innovation is critical to avoid its potential risks and to capture its substantial benefits. In this regard, future research may substantially deepen the insights into the relevance and role of outbound open innovation.

"Released, but not Lost: Motives and Environments Driving Firms’ Knowledge Disclsoure"

Current theories for firms’ outbound open innovation in terms of knowledge disclosure postulate several reasons for their behavior. The contribution of this study is twofold. First, motives for fir...

Exploring the Interplay of Industry Architectures and Outbound Open Innovation

This paper investigates how firms can leverage open innovation strategies to manipulate their industry architectures and influence capability development trajectories in their business ecosystems. ...

The Ins and Outs of Open Innovation in Network Environments

The open innovation literature reveals a disproportionate focus on inbound knowledge flows, despite the fact that the open innovation concept includes outbound and inbound forms of innovation. We also note the calls for more study of open innovation in networked environments. To address these imbalances we test how two outbound types of open innovation (selling and revealing), two inbound types (sourcing and acquiring), and absorptive capacity relate to novel product innovation for firms operating in a networked environment. We find that both outbound types are significantly related to novel product innovations. Furthermore, we show that revealing mediates the relationship between firms’ absorptive capacity and novel products, indicating revealing is an important development strategy. The inbound types tell a different story. We find acquiring is not related and sourcing negatively related to novel product innovation. These findings reveal the importance of outbound open innovation in networked environments such as the highly interdependent oil and gas industry. In this context inbound forms of open innovation have little utility in explaining novel product innovation where both pecuniary and non-pecuniary outbound forms so prevalent. We explore alternative explanations and suggest future research pathways.

Inbound, Outbound, and Coupled Open Innovation Practices in a Community Setting

This study empirically identifies the inbound, outbound, and coupled relationships postulated by Open Innovation (OI) scholars, using original data collected from 250 independent firms that interact with a common open source software community. Consistent with prior theories, inbound processes were associated with an increase in software-creation productivity. Two outbound processes had different consequences: the transfer of tangible IP led to an increase in a firm’s social ties with the community, but surprisingly, the transfer of social capital did not. Coupled processes that involved the transfer of IP resulted in more incremental innovations, while those that involved the transfer of social capital resulted in innovations that were more radical. This study addresses recent calls for OI research that empirically examine the coupled process in different settings and explores the relationships between open innovation and social capital (West et al. 2014). I discuss the implications of these findings for both open innovation researchers and managers of firms working with external communities.

What organizational culture types enable and retard open innovation?

Research suggests that cultural issues can make or mar the open innovation process. In this paper, we thus aim at identifying organizational culture types that enable and retard the two types of open innovation activities: in-bound and out-bound. Data were collected using the questionnaire survey method from 339 middle and top managers working in the Malaysian high-tech sector. Organizational culture emerged as a huge predictor of open innovation. We found that highly integrative culture enables in-bound open innovation, but does not significantly affect out-bound open innovation. Besides, hierarchy culture is found to retard both in-bound and out-bound open innovation. This paper is probably the first to empirically investigate the role of culture in open innovation. The findings fill an important gap in open innovation theory while practical implications extend to managers interested in open innovation adoption in their organizations.

Outbound open innovation in bio-pharmaceutical out-licensing

Our study investigates the outbound open innovation of firms engaged in technological venturing. Leveraging insights from the sociology theory and innovation literatures, we clarify whether social status helps entrepreneurial ventures overcome market imperfection and information asymmetry in out-licensing and illustrate the importance of specific aspects of social status building in this context. We also examine the effect of failure experiences on out-licensing. We take a dynamic view of desorptive capacity by studying an entrepreneurial venture’s learning process, both internally, in terms of its own technology trajectory, and externally, through inter-organizational alliances. We apply a negative binomial model to our novel panel of 180 firms studied over an 18-year period with controls for stocks of clinical development activities, patenting and prior licensing activities. Empirical analysis enables us to observe the impact which the firms’ technological and development status, reputation and desorptive capacity exert upon out-licensing volume. Prior outbound open innovation studies do not account for the heterogeneity of technology and R&D success and failure experiences observed in our study. We also demonstrate the contingency effect of external learning from alliances during the building-up of a firm’s desorptive capacity, or the way in which the number of co-authoring partners in scientific publications negatively moderates the positive effect of the number of commercial alliances on the volume of its out-licensing deals. Our findings contribute to the understanding of external knowledge exploitation and complement important aspects of the literatures on outbound open innovation and desorptive capacity, offering empirically rich insights for bio-pharmaceutical firms into the drivers behind volumes of out-licensing deals.

Do managerial ties support or stifle open innovation?

Purpose– Research investigating the role of factors affecting open innovation remains scarce. The purpose of this paper is to examine the role of managerial ties in facilitating the two types of open innovation – in-bound and out-bound.Design/methodology/approach– Data are collected using the questionnaire survey method from 339 middle and top managers working in four high-tech industries in Malaysia.Findings– Results show that in most high-tech industries in Malaysia, managerial ties with universities and with government officials facilitate in-bound open innovation, while ties with managers at other firms do not significantly relate to it in any high-tech industry. Further, managerial ties are not found to relate significantly to out-bound open innovation in any high-tech industry except in the aerospace and electronics industries wherein ties with government officials relate negatively and positively to out-bound innovation, respectively.Practical implications– This study provides empirical evidence about the managerial ties practitioners should and should not forge to succeed in the open innovation paradigm.Originality/value– This study is probably the only study so far that gauges the impact of managerial ties on open innovation. The results of this study fill a major gap in the current open innovation theory besides providing insights for practitioners.

Outbound open innovation in China and Russia: innovation system approach

Barriers to open innovation (OI) result from both internal and external factors. One of the most important external/environmental factors affecting knowledge flows between organisations, and hence the utilisation of OI is the national innovation system (NIS) and its institutions. This study aims at clarifying the influence of economic systems and institutions on OI practices by examining barriers to OI in China and Russia. The study distinguishes the main factors within a national system of innovation influencing the OI practices of companies, as well as the barriers arising from them.