Open Innovation and Market Orientation: An Analysis of the Relationship
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Open Innovation and Market Orientation: An Analysis of the Relationship Elisa Arrigo 1
Received: 14 October 2015 / Accepted: 28 October 2015 # Springer Science+Business Media New York 2015
Abstract Open innovation has become an emergent topic in innovation management founded on the assumption that the development of innovative processes may lie outside the companies’ boundaries. In particular, this paper has pursued to address one gap in existing research on open innovation, namely the investigation of its relationship with market orientation that promotes continual processes of innovation leading to higher customer value. Findings have shown how market-driven companies tend to overcome the classical view on relying innovation on internal Research & Development departments in order to become more permeable to the outside environment. In fact, market-driven companies develop distinctive outside-in, inside-out, and spanning capabilities that encourage the matching and integration of internal resources with external partners and open innovation emerges as an essential driver to preserve and improve their competitiveness. Keywords Open innovation . Market orientation . Outside-in . Inside-out . Globalization
Introduction Open innovation represents one of the hottest topics in innovation management: a simple search in Google Scholar on open innovation provides over 3 million hits (Google Scholar, July 2015), and this data compared with that of July 2010, 2 million hits (Huizingh 2011), marks a growth of+50%. This is enough to highlight the increasing academic interest for this topic. Open innovation has emerged as a new approach of innovation management founded on the assumption that innovative ideas can be sourced also from the outside; then, companies need to look outside for new paths to innovation (Chesbrough 2003; Gassmann et al. 2010). The open business
* Elisa Arrigo [email protected] 1
Department of Economics, Management and Statistics, University of Milan-Bicocca, Milan, Italy
J Knowl Econ
perspective proposed by Chesbrough (2003, 2007) states that open systems are today more successful than the closed ones (Gay, 2014). While traditional closed systems recommend to raise barriers to the external environment to generate innovations through internal research and development and to acquire defensible positions against the competitors, nowadays, in many industries, companies have understood the opportunity of incorporating new ideas from the outside in order to complement their own competencies (Carayannis et al. 2014). In effect, in open markets, companies operate in turbulent and hyper-competitive industry conditions that force them to continuously innovate; market dynamics erode the acquired competitive positions and companies need to reconsider their customer value creation strategies (Martens et al. 2012). Market-driven management has been recognized by many academics (Day 1994, 1999; Narver and Slater 1990; Kohli and Jaworski 1990; Webster 2002; Best 2009; Lambin 2000) and practitioners as one of
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