Harnessing soft innovation resources leads to neo open innovation

Abstract

Advancement of the digital economy has transformed the concept of the growth crossover in nations and firms, both concerning input and output. Advanced economies have been confronting a dilemma between input increases and output decreases. Contrary to traditional expectations, excessive increase in input has resulted in a productivity decline in output. A solution to this dilemma can only be expected by harnessing the vigor of soft innovation resources that lead to neo open innovation in the digital economy. This paper attempts to demonstrate this hypothetical view. Based on an empirical analysis of the development trajectories of 140 countries and 500 global ICT firms, dynamism, resulting in bipolarization between a virtuous cycle and a vicious cycle between input increases and productivity enhancement, was discovered. Furthermore, an empirical analysis focusing on the development trajectories of two world ICT leaders, Finland and Singapore, identified a mechanism of neo open innovation that assimilates soft innovation resources into a national production system. This mechanism can substitute for research and development (R&D) and removes structural impediments to growth while providing relief from the increasing burden of R&D investment. The above findings provide insightful suggestions for drafting a roadmap towards neo open innovation in the digital economy.

A SOLUTION TO THE DILEMMA BETWEEN R&D EXPANSION AND THE PRODUCTIVITY DECLINE: LESSONS FROM THE R&D MODELS IN AMAZON AND FINLAND

“…The authors in the preceding studies demonstrated the significance of neo open innovation that harness the vigor of soft innovation resources (SIRs) from the market place as illustrated in Fig. 7 [1], [2]. Here, SIRs are considered as a condensate and crystal of the advancement of the Internet (Tou et al, 2018b, 2019b) and consist of the Internet based resources that have been either sleeping or untapped or are results of multisided interaction in the markets where consumer is looking for functionality beyond an economic value.…”

“…Notwithstanding the critical problem of a dilemma between R&D expansion and productivity decline that a majority of information and communication technology (ICT) leaders have been confronting in the digital economy [1], [2], Amazon has been able to accomplish a skyrocketing increase in R&D and market capitalization. In corresponding to such a rapid and notable increase in R&D investment, Amazon has accomplished a skyrocketing increase in its market capitalization (MC).…”

CO-EVOLUTIONARY COUPLING VIA A DIGITAL-BIO ECOSYSTEM – A SUGGESTION FOR A NEW R&D MODEL IN THE DIGITAL ECONOMY

“…Such an R&D-driven virtuous cycle notwithstanding the dilemma between R&D expansion and productivity decline [29,30] suggests a significant role that assimilated external resources in innovation, particularly soft innovation resources, may play. Prompted by such a hypothetical view, assimilation capacity and subsequent assimilated soft innovation resources were analyzed.…”

“…Where SIRs can be represented by ID (Internet dependence) as SIRs can be considered a condensate and crystal of the advancement of the Internet [29,30].…”

Co-Evolutionary Coupling Between Captured and Uncaptured GDP Cycles:cross Learning From Amazon and Finland Models for Sustainability

“…Notwithstanding the critical problem of a dilemma between R&D expansion and productivity decline that a majority of information and communication technology (ICT) leaders have been confronting in the digital economy [1,2], Amazon has been able to accomplish a skyrocketing increase in R&D and subsequent market capitalization as demonstrated in Fig. 1 [3].…”