The Determinants of Inbound and Outbound Open Innovation Activities in Korean Manufacturing SMEs

This study empirically analyzed the various determinants that might influence both inbound and outbound open innovation activities in the perspectives of environmental characteristics, firm-specific characteristics and government institutional characteristics based on the survey results of 108 manufacturing SMEs in Korea. Our findings reveal that for the environmental characteristics, the degree of market competition and technological change showed a positive relationship with inbound open innovation activities, which implies that when pushing for open innovation, SMEs need to be equipped with a systematic monitoring system to better understand their environment. For the firm-specific characteristics, R&D personnel, R&D investment, overseas sales and the openness of their organizational cultures were correlated with inbound open innovation activities. However only R&D investment and the openness of their organizational culture positively influenced inbound open innovation activities. These results suggest that SMEs strategically need to utilize internal resources, and try to enable employees to become more open through the proper training and rewards system for facilitating their open innovation. For the government institutional characteristics, technology networking showed a positive relationship both with inbound and outbound open innovation activities. We believe that a government needs to help SMEs strengthen technology networking by developing and implementing various government-supported policies and programs for promoting open innovation in SMEs.