Article Preview
Top1. Introduction
Today, innovation is considered a key factor for the success of firms in the marketplace (Hult et al., 2004) to drive competitive advantage and improve performance (Forsman & Temel, 2011; Smith et al., 2008). Chesbrough (2003a) discusses two kinds of innovation: Closed Innovation (CI) and Open Innovation (OI). CI returns to 20th century when the universities and states did not take any activities for commercialising the science (Parhizgar et al., 2013). The process that large companies internally explored, developed, and commercialised technologies identified as CI (Chesbrough, 2003b). Henry Chesbrough introduced OI 14 years ago and defined it as “the use of purposive inflows and outflow of knowledge to accelerate internal innovation and to expand the markets for external use of innovation” (Chesbrough, 2006). In OI model, the firm looks beyond its internal environment and limited resources for ideas and opportunities (Chesbrough, 2003a; Spithoven et al., 2013). OI is based on two main dimensions, “Exploration” and “Exploitation” (Chesbrough & Crowther, 2006; Enkel et al., 2009). Exploration refers to the process of search and integration of external knowledge that includes networking and collaboration with other organisations such as universities, suppliers, partners, and customers in the development of products, services and internal use of intellectual property licences among others (Chesbrough & Crowther, 2006). Even the largest firms need to open their innovation activities by collaborating with other organisations in order to keep pace with technological developments (Chen et al., 2011). Small and medium-sized enterprises (SMEs), as the majority of firms in the service and manufacturing sectors, play significant roles in the growth (Abdullah et al., 2016), development, and industrialisation of many economies (Shafiei Nikabadi & Zamani, 2016). However, SMEs have difficulties keeping up-to-date, developing, and commercialising innovations (Schmidt et al., 2016) and Current innovation processes in SMEs are characterised by nonlinear collaboration forms which involve different stakeholders from various origins (Schulz, 2014). Although one of the most pressing for academics and practitioners alike relates to how OI can be implemented (Gassmann, 2006), few studies have emerged about investigating OI practices in SMEs (Huizingh, 2011; Lee et al., 2010; Van de Vrande et al. 2009; Laursen & Salter 2006). In Iran, about 75% of manufacturing firms are SMEs (Shafiei Nikabadi & Zamanlo, 2012). However, there are only few domestic studies about OI implementation in manufacturing SMEs (MSEMs). Comprehensive exploring about effective factors OI in MSMEs in terms of different aspects and examining causal relations among studied factors are expected to help MSMEs desirous of adopting OI. Thus, in order to help Iranian MSMEs due to successful OI implementation, the paper aims to answer this question “What is the Causal model of effective factors on OI in MSMEs?” after identifying the most vital effective factors on OI among MSMEs in Iran.