Open innovation implementation in the service industry: Exploring practices, sub-practices and contextual factors

This paper addresses a major gap in reported research on open innovation (OI) literature: How do service firms adopt open innovation? This research focuses on data from eighteen service SMEs in Belgium from high-tech and knowledge-intensive service industries. Based on analysis, we find new insights regarding open innovation practices (i.e., inbound and outbound) and sub-practices (i.e., acquiring, sourcing, selling and revealing) for service firms. More specifically, the study showed that service SMEs are more inclined to use inbound practices due to reasons associated with firm size, industry, and knowledge intensity in the market, whereas the decision about which sub-practice to adopt seems to be strongly influenced by the type of actor, the firm’s vulnerability and internal managerial skills, and the existence of complementarities. Thus, we contribute to OI literature as well as capability literature through providing initial insights regarding the adoption of OI by service firms.