Does a firm’s open innovation mode matter?

Abstract

Open innovation enabled smaller firms to become competitive rivals to multina- tionals, as it leverages the knowledge and initiatives of external sources and searches outside of firm’s boundaries for commercialization opportunities. The aim of this research is to approach open innovation as a multifaceted phenomenon and to address some of the fundamental ques- tions that arise in the literature on open innovation. Such questions include: Do different open innovation modes exist? Does it matter which open innovation mode a firm chooses? Should any specific open innovation dimension receive additional attention? We define the mode of open innovation to be a specific combination of different open innovation dimensions. In seek- ing answers to these questions, we used quantitative and qualitative research methods and identified four different open innovation modes: open innovators, systems engineering com- panies, R&D outsourcers, customer-oriented companies. Understanding the contributions of individual open innovation mode and dimension is important for implementing effective decision-making processes. The findings have important implications for CEOs when allocat- ing (scarce) resources to the development of open innovation-related activities.