Open Innovation and Its Applicability in SMEs

Abstract

Rapidly changing consumer demands and needs have shortened the life span of products and services. Innovative products that are produced with long and intensive studies of R&D departments complete their life spans in a short time. Therefore, firms tend to search for interesting ideas developed outside the boundaries of the enterprise. Within this framework, by going beyond innovation, the concept of open innovation emerged as a remedy for the achievement of sustainable competitive advantage. Chesbrough defined open innovation as “the use of purposive inflows and outflows of knowledge to accelerate internal innovation and expand the markets for external use of innovation.” The research of open innovation in SMEs is primarily important since SMEs tend to open up more than large firms to reach external knowledge and technology for innovation. In this context, the aim of this chapter is to identify open innovation practices, motivations, intentions, and challenges in SMEs by systematically reviewing related concepts with open innovation in SMEs.