The adoption of open innovation practices is becoming increasingly important for SMEs seeking to remain competitive in today's fast-paced business environment. The aim of this study is to understand the implementation of open innovation processes by SMEs while highlighting two critical processes: open innovation implementation (OII) and open ambidextrous innovation practices (OAIP). The study employes a second-order factor analysis incorporating multigroup structural invariance analysis to explore the differences in ambidextrous innovation practices across SME size categories using a sample of 615 SMEs in Thailand. The primary finding reveals and confirms a statistically significant positive relationship between the implementation of open innovation and the advancement of ambidextrous innovation practices. This relationship underlines the importance of embracing open innovation, as it fosters ambidextrous innovation, thereby enabling fresh perspectives, accelerating creativity, and facilitating knowledge exchange. Three categories of MSMEs—microenterprises, small enterprises, and medium-sized enterprises—are shown to be well positioned for adopting open innovation strategies, each demonstrating a significant ability to foster open innovation practices. In the study, practical and policy recommendations for business practitioners and policy-makers are presented, emphasizing the importance of understanding the organizational, managerial, technological, and contextual factors that underpin successful open innovation implementation. A novel structural second-order factor model that deepens our understanding of the complex relationships between open innovation processes is also introduced, offering valuable insights for academic researchers. In conclusion, this study emphasizes the importance of SMEs embracing open innovation practices and promoting ambidextrous innovation for sustained success and growth, and key strategic takeaways are proposed based on the empirical item-scale results.
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