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The IUP Journal of Entrepreneurship Development :
Open Innovation as Business Driver: Investigating the Impact of Firm-Level Evidence on Opening Up to External Players
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With respect to open innovation as a firm-level concept, taking the firm-level as the unit of analysis, the researchers analyzed open innovation as a business boosting phenomenon by investigating firm-level evidence on the opening up to external players. To achieve this purpose, the researchers made use of Super Sack Company Limited as a case study. The results revealed that the firm, a Small and Medium Enterprise (SME), has adopted open innovation framework with four models in its pipeline, i.e., pier to pier (company to competitors), company to dealers collaboration, company to end-user SMEs, and company to suppliers collaboration. And it found the positive effect of open innovation framework on boosting business acumen of SMEs, for the fact that the firm has enjoyed benefits from inbound open innovation practices which complemented its internal operations capabilities (via competitors and suppliers collaborations); and the firmís outbound open innovation practices complemented the firmís market position (via customers and dealers collaborations). These benefits have also had an impact on the firmí turnover which grew by 60%, while revenue grew by 50%, net profit by 30% and operation efficiency by 40%. This indicates that adoption of open innovation by this firm has significantly driven its business acumen.

 
 
 

There has been a change in innovation landscape over the last decades that has undermined the traditional view of innovation (closed innovation) in organizations. This is because it has been found that closed innovation is limiting the interactions with actors outside the organizational boundaries and emphasizing hierarchical control of all innovation activities within an organization (Chesbrough, 2003; and Chesbrough, 2006). The growing literature on “open innovation” highlights that firms have to vitalize their interest to purposively open their innovation processes and to interact extensively with their external players in their business environment. Though opening up to external players is a discretionary activity of a firm management, it is equally a strategic choice of firm’s management to drive its business goals (Brunswicker, 2011). Because, strategically, business success requires two basic elements: (1) firm’s internal environment; and (2) external environment (Aguilar, 1967). Koschatzky et al. (2001) observed that companies that do not cooperate and do not exchange knowledge and other resources are reducing their knowledge and resources base on a longterm basis and lose the ability to enter into exchange relations with other firms and organizations for mutual benefits. The main distinguishing term in open innovation paradigm is that in open innovation, firms interact with external partners (DeFillippi et al., 2007; and Dittrich and Duysters, 2007).

 
 
 

Entrepreneurship Development Journal, Open Innovation, Business Driver, Investigating, Impact, Firm-Level Evidence, Opening, Medium Enterprise (SME),, Business Driving Phenomenon, Open Innovation Framework, External Players.