The many shades of ‘openness’: an application of item response theory to open innovation research

Abstract

This study addresses one of the most basic research questions investigated in the Open Innovation (OI) literature: how open are firms? This question has remained partially unanswered given the challenges encountered by empirical research in assessing the relevance of specific OI practices within the OI model, as well as the types of activities perceived by managers as OI benefits or concerns. To provide an answer to this question, we suggest a framework using Item Response Theory to improve over current measures of firms' openness and test it on a sample of 383 technology-based SMEs. Our theoretical model conceives openness as an instance of how firms make decisions regarding the adoption of different OI practices based on their evaluation of OI benefits and concerns. Focusing on the relationship between firm-level differences in terms of openness and the types of OI practices adopted by these firms, we show that significantly different levels of ‘OI maturity’ are required to broaden the scope of external partnerships and to shift from non-pecuniary OI modes (relation-based approaches) toward pecuniary (transaction-based) practices. Our results have relevant implications for the OI literature and provide new managerial insight into OI adoption.