Asia pacific journal of information systems

The Korea Society of Management Information Systems (한국경영정보학회)
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The Role of Firm Size and IT Capabilities in Open and Closed Innovation

  • Byounggu Choi (College of Business Administration, Kookmin University)
  • Received : 2019.05.20
  • Accepted : 2019.09.25
  • Published : 2019.12.31
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Abstract

Open innovation has attracted significant attention from both academics and practitioners. However, theoretical and empirical researchers disagree on how open innovation improves firm performance. The inconsistent results reported in the literature may be attributed to the fact that they failed to provide an integrative view of how to make use of internal and external knowledge to enhance innovation performance. Furthermore, although the adoption value of innovation approaches varies depending on firm size and IT capabilities, their impacts have not been adequately taken into consideration. Drawing on complementarity theory, this study revisits the research problem and develops eight hypotheses. Surveys collected from 339 Korean firms were analyzed to test the hypotheses using the supermodularity functions. The results indicated that an internal knowledge-oriented innovation approach has a positive impact on innovation performance regardless of firm size. However, an external knowledge-oriented innovation approach has a positive effect on innovation performance in large firms while having no significant effect on innovation performance of SMEs. Results also confirmed a complementary relationship between internal and external knowledge-oriented innovation approaches in large firms, whereas substitutable relationships were confirmed in SMEs. This study sheds new light on open innovation by identifying the role of different types of innovation approaches, firm size, and IT capabilities.

Keywords

Acknowledgement

This work was supported by the Ministry of Education of the Republic of Korea and the National Research Foundation of Korea (NRF-2017S1A5A2A01025704).

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