Managing Open Innovation Project Risks Based on a Social Network Analysis Perspective

Abstract

In today’s business environment, it is often argued, that if organizations want to achieve a sustainable competitive advantage, they must be able to innovate, so that they can meet complex market demands as they deliver products, solutions, or services. However, organizations alone do not always have the necessary resources (brilliant minds, technologies, know-how, and so on) to match those market demands. To overcome this constraint, organizations usually engage in collaborative network models—such as the open innovation model—with other business partners, public institutions, universities, and development centers. Nonetheless, it is frequently argued that the lack of models that support such collaborative models is still perceived as a major constraint for organizations to more frequently engage in it. In this work, a heuristic model is proposed, to provide support in managing open innovation projects, by, first, identifying project collaborative critical success factors (CSFs) analyzing four interactive collaborative dimensions (4-ICD) that usually occur in such projects—(1) key project organization communication and insight degree, (2) organizational control degree, (3) project information dependency degree, (3) and (4) feedback readiness degree—and, second, using those identified CSFs to estimate the outcome likelihood (success, or failure) of ongoing open innovation projects.

A Model to Manage Cooperative Project Risks to Create Knowledge and Drive Sustainable Business

“…The benefit for organizations is that they can implement proactive actions (corrective or supportive measures) to reorganize and redirect cooperation to a desired level, and/or support and maintain existing cooperative behavioral patterns. This first dimension enabled by the proposed model in this work is in line with the latest research in the organizational management field that argues that first, cooperative networks supported by effective management models provide organizations strong benefits at both individual and collective levels [2,[6][7][8], and second, that the adoption of a more hands-on management style (more control from the management regarding how cooperation emerges or evolves) in opposition to a more hands-off approach management style (less control from the management regarding how cooperation emerges or evolves, also known as a fix-it-as-you-go issue resolution approach), is by far more beneficial to increase the chances of success [6,15].…”

“…The successful delivery of projects is critical for organizations because it is through projects, but not only, that organizations can execute their strategies, solve problems, satisfy needs, add value, capitalize on or exploit opportunities, adapt, change, learn, and innovate [2,8,13].…”

“…Furthermore, they argue that the application of SNA centrality metrics in the analysis of dynamic cooperative networks are the ones that enable us to get unique insights, unlike traditional tools or techniques [2,8,20,21]. According to the reviewed literature, centrality in a social cooperative network refers to the structural location of a given entity within a network, and can be a measure of an entity's influence, importance, control, and prestige [20,21,37].…”

“…In today's complex, turbulent, and unpredictable business landscape, if organizations want to achieve success, meet market needs and demands, or even just survive, they must develop strategies that boost performance and innovation [1,2]. The literature argues that both innovation and performance strongly depend on how an organization's C suit manages and motivates their employees to overcome daily challenges, such as different cultures, different time zones, different geographic locations, or different functions, while simultaneously nurturing the capacity and will to continuously learn and adapt [1,3].…”

“…The literature also shows that the adoption of an ambidextrous leadership style (characterized by the exploitation of present conditions to optimize current business model operations, while simultaneously exploring new opportunities that contribute to redefining business models by taking decisions in a pioneering, risky way) increases the chances of achieving sustainable competitive advantages [4,5]. In addition, the literature shows that the ability to work in cooperative networks in both organizational and individual levels is a critical factor for an organization to achieve success and generate actionable and unique knowledge [2,[6][7][8]. In fact, the latest research in organizational theory and management argues that although individual knowledge and skills are important, the ability to work in cooperative networks is almost always twice as critical to achieve success [6][7][8].…”