Managing Search Strategies for Open Innovation: The Role of Environmental Munificence as well as Internal and External R&D

Wolfgang Sofka and Christoph Grimpe

No 08-075, ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research

Abstract: Firms compete increasingly in an open innovation environment. Search strategies for external knowledge become therefore crucial for firm success. Existing research differentiates between the breadth (diversity) and depth (intensity) with which firms pursue external knowledge source. A consensus exists that resource constrains force firms to balance both dimensions. However, relatively little is known on how managers can selectively strengthen one of these dimensions. We argue conceptually that the breadth and depth of a search strategy depends upon the nature of a firm's absorptive capacity (i.e. whether they are built through internal or external R&D activities) and the munificence of its innovation environment. We test these hypotheses empirically for a large sample of more than 8,300 firms from 12 European countries. Our empirical results show that in-house R&D strengthens the depth of a firm's search strategy while external R&D activities (e.g. contract research) increase its breadth. Moreover, we find that scarce innovation environments favor deep search strategies while breadth is more prevalent in munificent environments. We develop targeted management recommendations based on these results.

Keywords: Open innovation; absorptive capacity; search strategies (search for similar items in EconPapers)
JEL-codes: L60 O32 (search for similar items in EconPapers)
Date: 2008
New Economics Papers: this item is included in nep-cse, nep-ino, nep-ipr, nep-pr~, nep-knm and nep-mic
References: Add references at CitEc
Citations: View citations in EconPapers (1)

Downloads: (external link)
https://www.econstor.eu/bitstream/10419/27553/1/dp08075.pdf (application/pdf)

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:zbw:zewdip:7418

Access Statistics for this paper

More papers in ZEW Discussion Papers from ZEW - Leibniz Centre for European Economic Research Contact information at EDIRC.
Bibliographic data for series maintained by ZBW - Leibniz Information Centre for Economics ().