To recover faster from Covid-19, open up: Managerial implications from an open innovation perspective

Covid-19 has severely tested our public health systems. Recovering from Covid-19 will soon test our economic systems. Innovation will have an important role to play in recovering from the aftermath of the coronavirus. This article discusses both how to manage innovation as part of that recovery, and also derives some lessons from how we have responded to the virus so far, and what those lessons imply for managing innovation during the recovery

Open Innovation and Strategy

The article discusses a process of business innovation known as open innovation and its relation to traditional business strategy. The competitive strategy developed by Michael Porter emphasized rivalry, buyer power, and barriers to entry as forces that could enhance a producer\u27s surplus. The authors discuss the impact of the Porterian value chain, the processes of production through to the consumer, on subsequent business practices. However, this theory does not account for external sources of value to a company, such as innovation communities, volunteer contributors and surrounding networks, including social networking web sites, open source software and the Wiki model of open contributions. The concept of openness requires shifting from ownership to value creation and value capture

Open innovation:Research, practices, and policies

Open innovation is now a widely used concept in academia, business, and policy making. This article describes the state of open innovation at the intersection of research, practice, and policy. It discusses some key trends (e.g., digital transformation), challenges (e.g., uncertainty), and potential solutions (e.g., EU funding programs) in the context of open innovation and innovation policy. With this background, the authors introduce select papers published in this Special Section of California Management Review that were originally presented at the second annual World Open Innovation Conference, held in Santa Clara, California, in December of 2015

Business Models in a New Digital Culture: The Open Long Tail Model

New business models are emerging in global markets. Quirky is producing new products designed and developed by the community and finally produced by the 3D printing technology. Google gives his glasses to different developers who build up their own applications. Kickstarter finds the funders by the use of the crowd, paying them back with the future products. Employees, funders, customers and partners do not play a stable role with the organization but revolve around it using different form of collaborations related to the organization’s needs. In this scenario business like Amazon find out their own achievement feeding up different customers’ needs

Return to R&D Investment and Spillovers in the Chinese Semiconductor Industry: A Tale of Two Segments

This study asks how a firm’s market orientation influences its returns to R&D investment and its capability to benefit from external technology opportunities brought about by the globalization of manufacturing and innovation activities. We use a panel of firm-level data on production and R&D activities to study China’s semiconductor industry. Building upon an earlier qualitative study, we find supporting evidence that this dynamic industry sector is characterized by two segments with very different market orientation: a domestically focused one with lagged technology, and a globally focused one employing advanced technology. While the former comprised the bulk of revenue and employment in the industry in 1998, the latter segment has grown substantially faster, and has now overtaken the former. We hypothesize that these two segments will differ in their R&D productivity, and ability to absorb external R&D. We test this hypothesis by examining the productivity consequence of in-house R&D investment and spillovers for each industry R&D investment. More specifically, we hypothesize that firms in the globally oriented sectors are more likely to receive higher returns to in-house R&D investment and positive spillovers from external R&D capital, especially from multinational firms, compared with domestically oriented firms. As a result, we expect that firms with higher in-house R&D capital will be more likely to receive positive spillovers from external knowledge. The empirical results support some but not all of our hypotheses. We find that firms in the global-oriented segment enjoy higher returns to R&D investment than those in the domestic- oriented segment and a larger positive spillover from external R&D capital. As the globally focused segment has grown to become the majority of firm activity in the industry, though, the competitive effects of more firms exporting appear to reduce the spillover benefits such firms enjoy from external R&D resources

Ecosystem effectuation: Creating new value through open innovation during a pandemic

The severity of the COVID-19 pandemic confronts us with a global grand challenge representing an unprecedented crisis for health, economies, and societies. While digital champions are thriving, a large number of businesses and industries have been facing radical uncertainty, pushing some to the edge of collapse. This emergency calls for new ways to look at organizational ambidexterity and business model innovation. In this paper, we present and discuss a unique case study of a low-cost airline, AirAsia. With their fleet of aircraft grounded, and unable to pursue any incremental innovation opportunities, AirAsia decided to follow a radical ambidexterity path – focusing on exploration by building an innovation ecosystem. This case not only offers insights on a novel way to create value through open innovation but also extends the body of knowledge on entrepreneurial effectuation by introducing the concept of an ecosystem effectuation. AirAsia’s case shows that, in financially distressed times, business model reconfiguration may not be enough, and instead of selecting means to attain goals, the goals may be created upon available means

Corporate Venture Capital in the Context of Corporate Innovation

Corporate venture capital (CVC) programs have followed a strongly cyclical pattern in response to the ebbs and flows of the private and public equity markets. However, the role of these programs inside the firm has received far less study. What role do corporate venture programs play inside large corporations, beyond any financial returns they generate? Do these programs substitute for more traditional corporate investments, such as R&D spending, perhaps outsourcing some portion of a company’s innovation activities? Or do they complement internal R&D spending, and effectively stimulate additional corporate innovation activities? To examine these questions, we develop a novel dataset of US and selected foreign corporations that have initiated corporate venture capital investment programs since 1980. We then examine the R&D spending activities of these firms, prior to and immediately after the onset of CVC programs. We find that the existence of a CVC program is strongly and positively associated with the level of corporate R&D spending, and that this finding is robust to several alternate methods of estimation. We conclude that CVC investing should not be studied merely as an asset class within the public and private equity markets. The strategic dimensions of CVC deserve more attention within the larger context of corporate innovation activities. CVC investments can complement the actions of other corporate innovation initiatives, effects that are not measured in analyses of the financial returns of CVC portfolio investments

The Forces of Ecosystem Evolution

Ecosystems are the result of a delicate balance between centripetal forces that push economic activities toward integration, and centrifugal forces that pull economic activities out onto the market. Ecosystems evolve when these forces change. For example, technological complementarities-the main source of centripetal force-are dynamic and may be commoditized, generalized, or standardized over time. Management and coordination also change: for example, open innovation practices enable firms to move innovation activities from the in-house R&D lab out into the ecosystem. This article discusses how such dynamics in technologies and management lead to ecosystem evolution

Open Innovation in Brazil: Exploring Opportunities and Challenges

Background: While open innovation has been increasingly adopted in developed countries, firms from emerging markets such as Brazil markedly fall behind this trend. Our understanding of the reasons behind this phenomenon remains limited, since most research focuses on the industrialized world.Objective: The objective of this paper is to inspire the academic community to investigate the issue of why companies from emerging economies such as Brazil have limited open innovation strategies, when they need to draw on external partners as to overcome the institutional, resource and capability constraints they are subject to.Method: We review current research on open innovation in general and especially in the Brazilian setting to develop a framework for studying this phenomenon and to suggest future research directions.Results: We argue that latecomer firms in emerging economies need to actively use open innovation more than ever, as to overcome internal rigidities and spur the innovative resources and capabilities required for the digital transformation and for addressing grand societal challenges. We contend that the Brazilian setting is a relevant empirical context to study, giving the potential to uncover unique mechanisms and theoretical relations by asking (and possibly answering) novel research questions.Conclusions: Building on a conceptual framework that links various implementation levels of open innovation, we identify themes that are either less well researched or contested and thereby suggest challenges and opportunities for future research

Relationship Between Firm's Performance and Factors Involved in the Selection of Innovation Providers

Innovation is the backbone of the product development in present era for the survival of the corporate organization in the respective market. Changing trends in every passing day are making the product development more competitive and innovative. This paper investigates the relationship between firm’s performance with respect to outsourcing innovations and factors affecting the selection of contract research organizations or innovation providers. The research is conducted by a self-designed instrument in the form of a survey form on 112 respondents internationally in 17 countries. The paper will give empirical relationship among firm’s performance, outsourcing innovations and six major factors, which play a vital role in the selection of CROs. Proposed hypotheses in this article are based on empirical relationship, which is validated by SPSS 24. The findings support the conceptual model and offer many managerial implications, which are described in detail at the end of the paper