Open innovation projects in SMEs as an engine for sustainable growth

Abstract

Most innovation activities that are inevitable for sustainable growth are coordinated via research and development (R&D) projects, which can differ widely in terms of both project and open innovation characteristics, even when conducted within the same firm. Therefore, it is important to consider the peculiarities of R&D projects when evaluating the performance of open innovation strategies, as well as to explore how the benefits and costs of open innovation are shaped by cross-level interactions. This study identifies the differences between successful and unsuccessful open innovation projects, in both firm-level and project-level terms. We focus on small and medium enterprises (SMEs), which usually lack the full set of internal resources and competences required to effectively develop, produce, and commercialize their innovations, and thus must adopt open innovation approaches more actively for sustainability. Adopting an empirical approach, we conducted a survey of 517 Korean SMEs and analyzed 241 successful and unsuccessful open innovation projects in depth. By combining measurements at the firm and project levels, this study provides new insight into the intra-organizational challenges of implementing open innovation projects, which are not only helpful to strategic decision-makers in SMEs, but also to those who make policies for them.