Open innovation practices are recurrent in the business environment due to resource and technology limitations in most companies. The search for complementary resources, especially among SMEs, begins to be a current practice due to the possibility of resorting to partnerships and collaborative processes. Thus, through a case study analysis of a Portuguese SME based in Aveiro, Portugal, it was possible to analyze the innovation process and the adoption of open innovation practices in this SME. Through a qualitative study, it was possible to understand the importance of SMEs in the Portuguese business fabric, as they increasingly seek to apply innovative processes in their processes. However, the case analyzed reveals that open innovation may involve an inter-organizational partnership where the company analyzed uses an intermediate model of open innovation, since it does not sell surplus technology, internalizing only external resources. This case study serves as a teaching case as well as a pedagogic tool.
TopIntroduction
Innovation is one of the most commonly used business strategies (Dantas & Moreira, 2011) to: (i) generate new products/processes and processes, (ii) adapt and developed new technologies, (iii) deploy changes within organizations in order to improve business competitiveness.
Innovation is one of the main drivers of business performance (Ribau et al., 2019; Zimmermann et al., 2020). It is normally related to the successful commercialization of the result of the generation and development of new ideas, transformed into products, services or processes (Dantas & Moreira, 2011; Hungund & Mani, 2019). The organizational climate is important for successfully promoting innovation within the firm. For that an innovation culture supporting free expression of ideas, divergent thinking practice, and risk aversion is mandatory (Popa et al., 2017).
If historically, most of the organizational knowledge and innovation was generated internally (Chesbrough, 2003), with the globalization of the technology and the business world, there are only a limited number of firms that would be able to compete by using exclusively their internal resources. Moreover, in an increasingly competitive world, where competitive advantages are ephemeral and hardly sustainable in the long term due to technological change (Bianchi et al., 2010; Lööf & Heshmati, 2006; Parida et al., 2012), innovation and technology have become key elements in the development of the knowledge economy. If innovation is important, inter-organizational relationships based on open innovation (OI) and technological alignment are important for the business success (Carvalho & Moreira, 2015; Silva & Moreira, 2021).
Open innovation, as defined by Chesbrough (2003), consists of using internal and external sources of knowledge and technology. Although the resource-based view of the firm has been extensively used to defend the importance of the internal source of knowledge and innovation as a competitive advantage, external sources of knowledge seek to accelerate internal innovation processes, to increase the potential for entering into new markets and to obtain better business performance (Bernal-Torres & Frost-González, 2015; Chesbrough, 2003, 2006; Hungund & Mani, 2019; Lööf & Heshmati, 2006).
Unlike the traditional model of innovation, where all the knowledge, technology and innovation is coordinated and internalized and controlled by the company, OI is characterized by a porous organization in which firms interact with their partner organizations to internalize and externalize knowledge and technology (Torres et al., 2015). The concept of OI assumes that organizations use both external and internal ideas and knowledge to enhance their innovations (Boger et al., 2018). As firms are applying business models to enhance their R&D capabilities, and taking into account the characteristics normally associated with small and medium-sized firms (SMEs), OI is very important to leverage the development and competitiveness of SMEs. In fact, resource constraints and the small size of SMEs force them to interact with the outside world in order to gain access to the resources and knowledge they need, but do not have. Consequently, OI plays a very important role in its growth and competitiveness.