Effects of open innovation strategies on innovation performance of SMEs: evidence from China

Abstract

<jats:sec> <jats:title content-type="abstract-subheading">Purpose</jats:title> <jats:p>The purpose of this study is to investigate the relationships between two types of open innovation (OI) strategies (OI breadth and depth) and innovation performance of small- and medium-sized enterprises (SMEs) in China. The study examines how firms’ absorptive capacity and government institutional support affect these relationships.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Design/methodology/approach</jats:title> <jats:p>Survey data from 236 manufacturing SMEs in China were used to test the proposed model using hierarchical regression analysis.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Findings</jats:title> <jats:p>The results show that both OI breadth and depth are positively related to innovation performance of SMEs. Moreover, this study finds that realized absorptive capacity serves as a mediator in the relationships between OI breadth and depth and innovation performance. The potential absorptive capacity and government institutional support moderate the relationship between OI breadth and innovation performance.</jats:p> </jats:sec> <jats:sec> <jats:title content-type="abstract-subheading">Originality/value</jats:title> <jats:p>The effectiveness of OI strategies is significantly different among SMEs. One possible explanation is that SMEs adopt different types of OI strategies. Another is that a firm’s absorptive capacity and government institutional support may influence the effectiveness of OI. This study integrates these two possible reasons by investigating the effect of the interplay between different OI strategies, absorptive capacity and government institutional support on SMEs’ innovation performance. This study enriches the research on the relationships between OI strategies and innovation performance of SMEs in the Chinese context.</jats:p> </jats:sec>

Effect of Innovation Orientation of High-Tech SMEs “Small and Mid-Sized Enterprises in China” on Innovation Performance

“…Since the late 20th century, most economies have entered the "innovation-driven" stage. Innovation is the most effective way for organizations to obtain a competitive market advantage and realize sustainable development [14][15][16]. Innovation is the process of generating innovative ideas and implementing creative behavior.…”

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“…Nonetheless, SMEs have an advantage over larger firms in that they are less bureaucratic and their business culture is a bit more flexible. Additionally, they are usually more responsive to market needs and their innovative plans are usually more varied as well (Lu, 2021;Taghizadeh et al, 2021). Nonetheless, Jordanian SMEs are still in the early stages of implementing any sort of innovative strategies.…”

The Effect of Formal and Informal External Collaboration on Innovation Performance of SMEs: Evidence from China

“…In addition, the contingency factors in the relationship between external collaboration and innovation performance has also attracted scholars' attention. However, existing studies have mainly focused on the contingency role of external factors, such as technological uncertainty [35] and government support [36], and internal competency factors such as absorptive capacity [16]. Many other important potential contingency factors, such as managers' entrepreneurial orientation and organizational legitimacy, have not been examined.…”

“…Moreover, among SMEs, high-tech manufacturing SMEs are more active to engage in external collaboration than other types of firms. Therefore, in this study, we chose high-tech manufacturing SMEs in China as our research sample [36]. In China, for industrial enterprises, SMEs are defined as firms with less than 1000 employees, or firms for which total revenue is less than 400 million Chinese Yuan.…”

“…Second, this study further extends the research on external collaboration-innovation performance relationship by integrating leadership trait theory and institutional theory with open innovation theory to account for the moderating effects of managers' entrepreneurial orientation and organizational legitimacy. Existing studies have mainly focused on the contingency role of external factors such as technological uncertainty [35] and government support [36], and internal competency factors such as absorptive capacity [16]. However, the internal mechanism in the relationship between formal and informal external collaboration and innovation performance remains unclear.…”