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Open innovation research and practice recognize the important role of external complementors in value creation. At the same time, firms need to retain exclusive control over some essential components to capture value from their product and/or service system. This paper contributes to the literature by analyzing some of the trade-offs between openness to external value creation and closedness for internal value capture. It focuses on selective openness as a key variable and investigates how it affects value creation by external complementors, specifically the members of user innovation communities. Openness, it is hypothesized, matters to community members: The more open a product design is, the higher their sense of involvement in the innovation project, and the larger the effort they devote to it. Unlike prior literature, different forms and loci of openness are distinguished, specifically the transparency, accessibility, and replicability of different components of the product being developed. Hypotheses are tested based on survey data ( n = 309) from 20 online communities in the consumer electronics and information technology hardware industries. Multilevel regression analysis is used to account for clustering, and thus nonindependent data, at the community level. We find that openness indeed increases community members' involvement in the innovation project and their contributions to it. Interestingly, however, some forms and loci of openness strongly affect community perceptions and behavior, while others have limited or no impact. This finding suggests that, at least in relation to user communities, the trade-off that firms face between external value creation and internal value capture is softer than hitherto understood. Contingency factors that may be able to explain these patterns are advanced. For example, users are expected to value the form of openness that they have the capabilities and incentives to exploit. The findings in this paper extend the literature on selective openness in innovation. They emphasize the need to study the demand for different forms of openness at the subsystem level and align supply-side strategies to it. In managerial practice, a careful assessment of the demand for openness enables firms to successfully use selective openness and to effectively appropriate value from selectively open systems. [ABSTRACT FROM AUTHOR]

Many managers expect a substantial impact of digitization on new product development (NPD) as it is an information-intensive business process. Therefore, a better understanding of how information technology (IT) might improve the NPD process is important for both theory and practice. Drawing on the IT business value literature, this study develops a comprehensive conceptual model to investigate empirically how IT and non-IT organizational antecedents translate into NPD IT capabilities and competences and how these are related with NPD performance. Based on survey data from German NPD managers, this study offers several insights. First, it shows that the development of superior NPD IT capabilities and competences depends on the ability to acquire and deploy suitable IT (i.e., firm-level IT capabilities) and on appropriate strategic, structural, and cultural conditions ensured by a strong top management focus on NPD IT (i.e., executive champion for NPD IT). This study hence contributes empirical evidence to the NPD and the IT business value literature by expanding research on complementary resources. Second, this study addresses limitations regarding the conceptualization of NPD IT capabilities and their relationship with further sources of competitive advantage arising from NPD IT tool usage by considering both the effectiveness and the frequency of usage as well as the relationship between both. Third, this research updates the measurement of NPD IT tool usage effectiveness (i.e., IT leveraging competence) to account for technological developments. Moreover, this study reveals that the effectiveness of NPD IT tool usage is positively associated with NPD performance. It also highlights that the dissemination of IT tools does not directly increase NPD performance, but that NPD IT tool use frequency is an important antecedent of IT leveraging competence. For managers, this paper offers empirical evidence that firm-wide IT capabilities and a focus on NPD IT are important predictors of NPD performance. [ABSTRACT FROM AUTHOR]

The article discusses various reports published within the issue, including one by Boris Durisin on bibliometric study of the journal, one by Roger Calantone and colleagues on competitive effects in the motion picture industry, and one by Lisa Song and Michael Song on the marketing issue of research and development from the perspective of information technology.

Existing literature on research and development ( R&D) alliances focuses on formation motives and performance impacts of these alliances but hardly on diversity of the partners' portfolio. Cooperation with a diverse set of partners leads to learning opportunities with regard to both cooperation and innovation skills and hence is expected to enhance the firm's innovation performance. This paper examines two research questions: (1) the impact of functional and geographical diversity of R&D partners on radical and incremental innovation performance of product innovating firms, and (2) the organizational determinants of partner diversity in R&D alliances. The empirical analysis is based on data from the Dutch Community Innovation Survey, R&D and Information and Communication Technology Surveys, and Production Statistics, which lead to a representative sample of 12,811 innovating firms in the period 1994-2006. Through random-effects panel Tobit estimates, econometric models for both research questions are estimated. The results indicate that functional and geographical diversity act through different channels. Functional diversity leads to a variety of knowledge intake and synergetic effects necessary to develop and commercialize novel products. Geographical diversity results in successful adaption of existing products to different local requirements such as technical standards, market regulations, and customer preferences. The organizational determinants of both kinds of partner diversity are prior experience, patenting, and information technology infrastructure. [ABSTRACT FROM AUTHOR]

Increasing globalization and the rapid growth of information technologies, including the Internet, have resulted in drastic changes in international activities of companies. Once limited to manufactured goods, currently, global outsourcing encompasses a wide variety of knowledge-based services, such as accounting, financial services, taxation, customer service, information technology, engineering drawings, human resources, research and development ( R&D), data processing, and sales. The domain of outsourcing knowledge-based services is the focus of this paper. Moving beyond the inevitability of global outsourcing, this research takes the perspective of the outsourcer and focuses on managing its transition to providers in the context of innovation. In addition to delivering projected cost benefits to outsourcers, effective transition management can facilitate the generation of innovations. This research attempts to extend the current academic research on global outsourcing in three ways: (1) It offers a framework for understanding the transition process in outsourcing and its relationship to innovation; (2) it takes a broader perspective of outsourcing, including globalization, knowledge-based services, and core activities of the firm; and (3) using a parsimonious set of theoretical concepts based on control theory, it develops several research propositions to clarify the linkages between variables. Based on our theorizing, outsourcing top management should ask two questions when planning outsourcing of knowledge-based services to generate innovations in a globalized world. These two questions are: (1) How close is the task to our core competence? And (2) how much tacit knowledge is involved in doing the outsourced task? Next, managers must identify global providers and then spend considerable thought in operational execution of the transition of the task for that is the only time that both complete teams will work together. For tasks that are close to core competence, rigid-explicit behavioral controls should be put in place; however, for tasks that have high tacit knowledge content, high norms-based relational control would be more effective. These different types of controls would lead to different innovation outcomes. Rigid-explicit behavioral controls would produce incremental innovation while relational norms-based controls would encourage radical innovation. [ABSTRACT FROM AUTHOR]

The effective integration of research and development (R&D) and marketing contributes to the development of successful new products. Barriers such as physical separation of R&D and marketing, goal incongruity, and cultural differences hamper the cross-functional cooperation. However, it may not be either possible or desirable to eliminate the cross-functional integration barriers in practice. Previous research findings suggest that information technology (IT) can be used to reduce the negative impact of the barriers. This paper examines the moderating role of communication technologies (ITc) and decision-aiding technologies (ITd) in improving the R&D–marketing integration in new product development. The empirical findings from analyzing data on 171 new product development projects suggest that both IT systems can be used to reduce the negative impact of physical separation, goal incongruity, and cultural differences on R&D–marketing integration. However, effectiveness of the two types of IT differs. While ITc appears to be more effective than ITd in overcoming the constraint of physical separation, ITd is more effective than ITc in reducing the negative impact of goal incongruity and cultural differences. ITc is found to have the strongest effect on reducing the negative relationship of physical separation and integration, a less strong effect on cultural differences, and a weak effect on goal incongruity. Conversely, ITd is found to have a strong effect on goal incongruity. These empirical findings provide guidelines for project managers using a specific IT to address a specific integration barrier. If the major barrier is physical separation, ITc is the best solution. On the other hand, if the major barrier is goal incongruity, ITd is the best solution. In addition, it is important for management to note that IT requires more than simply installing computer hardware and software. In addition to investing in those “hard” improvements, project managers should strive to create a supportive “soft” environment by consistently improving members' IT experiences and familiarity. In the process of the continuous development of IT, state-of-the-art technologies should be introduced in a timely manner and be made accessible to all team members. Finally, project managers should frequently observe their industry peers' IT usage to keep up with advances. [ABSTRACT FROM AUTHOR]

This research sheds new light on how information technology (IT) assimilation affects exploratory and exploitative innovation in the context of small‐ and medium‐sized firms (SMEs). This contextualization is important in establishing the boundary conditions for the theory, as well as generating specific managerial insights for SME managers. A sample of 248 U.K.‐based SMEs in the manufacturing industry demonstrates contextual ambidexterity (CA) mediates the relationship between IT assimilation and two types of innovation. This finding highlights that IT assimilation does not automatically promote innovation. Instead, IT assimilation represents a critical resource that enables the effective implementation of CA, which in turn affects innovation. This implies that SMEs cannot fully realize the potential of their IT assimilation and use it to enable innovation without implementing CA. Furthermore, this study differentiates between two different dimensions of knowledge base: knowledge breadth and knowledge depth. This study finds that knowledge breadth moderates the indirect IT assimilation–exploratory innovation relationship by influencing the effect of CA on exploratory innovation. Knowledge depth, on the other hand, moderates the indirect IT assimilation–exploitative innovation relationship by influencing the effect of CA on exploitative innovation. This finding implies that SMEs can benefit from their IT assimilation that enables them to engage in CA, which in turn allows them to perform innovation. However, it is apparent that the dimension of knowledge that SMEs hold internally can determine what types of innovation that they are able to perform. [ABSTRACT FROM AUTHOR]

Innovation activities and, particularly, service innovations, impose high demands on a firm's information processing capabilities. IT tools are supposed to support internal and external information flows, thereby improving a firm's information processing capabilities. However, past research is indecisive about how IT tools influence innovation performance. Furthermore, past research has not considered that services have an increasingly relevant role in a firm's innovation portfolio that can complicate information processing. This study therefore draws on information processing theory and service innovation literature to develop a conceptual model that explains how IT use intensity—depending on the firm's business focus—affects innovation program performance. By using a cross‐industry, multi‐informant sample of the innovation programs of 116 firms, which were collected from 887 informants, this article provides empirical evidence that (i) intensive IT use in order to exchange information with internal and external stakeholders improves the firm‐wide market knowledge, which in turn has a positive impact on a firm's innovation program performance; (ii) the performance impact of market knowledge becomes stronger with increasing degrees of servitization; (iii) a higher degree of servitization reduces IT's use intensity. This research demonstrates the dilemma that servitized firms face: Their business focus hinders the use of IT tools, although the latter will enable them to gain more benefits from the improved market knowledge they create. Practitioner Points: Intensive IT use positively influences the firm‐wide innovation performance. The intensive use of IT tools to strengthen internal information flows and IT tools to support exchange with external stakeholders increase a firm's market knowledge, which enhances the innovation program performance. Service innovations have higher information requirements than product innovations and profit therefore more from intensive IT use, but services' complexity hinders IT implementation. Firms with a higher degree of servitization use less IT, although they can profit more from the market knowledge IT tools create. Servitized firms need to install a flexible, modular, and open IT system for efficient IT use and to include all relevant internal and external stakeholders. [ABSTRACT FROM AUTHOR]

The Internet of Things (IoT) is expected to be the next phase of the Internet revolution and to transform consumers’ service experience. It nevertheless raises challenges on innovation in services. Based on Ram and Sheth's ( ) theoretical framework, this work attempts to provide a better understanding of the barriers that lead to consumers’ resistance to smart services as an innovation. To this end, our research adopts an integrative framework that combines functional barriers, psychological barriers, and individual barriers to explain consumer resistance to smart services. Structural equation modeling was used to test this theoretical framework. Our research enriches the existing literature by (1) adapting Ram and Sheth's ( ) theoretical framework to the evolution of digital technologies (technological vulnerability barriers), (2) taking into account the ideological aspect of resistance (ideological barriers), and (3) considering dispositional variables (individual barriers). Moreover, it highlights the key role of skepticism toward IoT devices as a mediator between technological vulnerability barriers and individual barriers on the one hand and consumer resistance to smart services on the other. [ABSTRACT FROM AUTHOR]

The impact of big data on innovation is not only driven by technology and analytics. It involves a transformation of the organizational culture, structures, processes, roles, and capabilities that underpin the innovation process. Understanding these factors is particularly important for service innovators, given the strong interdependence between the organizational context and technology in service companies. Moreover, in many of these organizations, the innovation process is still deeply rooted in a non-digital past. This study answers the call to understand what are the key characteristics of a systematic process for service innovation in data-rich environments. In particular, the authors investigate the primary factors that enable existing service organizations to capture the innovation potential inherent in data-rich environments. To this aim, the authors implemented a two-step research design. First, they integrated the service innovation and information systems literatures in a unified conceptual framework that articulates the relationship between data-rich environments and service innovation from an organizational perspective. Second, they carried out 40 semi-structured interviews in seven large service firms, which allowed them to refine and populate the initial framework with typologies, concepts, and examples from the field. A major contribution of this study is to articulate the concept of data density, as three distinct processes (pattern spotting, real-time decisioning, and synergistic exploration) connecting data-rich environments with service innovation opportunities. Finally, the authors identified a set of organizational enablers that facilitate the links among technology, data density processes, and service innovation. The findings of this study offer a roadmap for service managers who need to align the service innovation process of their organizations with the opportunities offered by data-rich environments. [ABSTRACT FROM AUTHOR]

Emergent research has examined the antecedents to using information technology ( IT) in the new product development ( NPD) process and the impact of IT on NPD performance. Based on the resource-based view ( RBV) of the firm, this study hypothesizes that particular resources create IT capabilities that significantly enhance NPD outcomes. More specifically, this research extends previous work by investigating whether three complementary resources, namely an executive champion for IT, global engagement, and organizational innovativeness, influence IT capabilities ( IT use frequency and IT replacement frequency), which in turn affect NPD outcomes ( NPD task proficiency and NPD performance). To test the conceptual model, survey data were collected from 220 NPD and IT managers in a variety of large Japanese firms. The results show that an executive champion for IT and global engagement are predictors of both IT tool use and replacement frequency while organizational innovativeness contributes only to IT tool replacement frequency. The results also indicate that both IT tool use and replacement frequency have a positive effect on NPD task proficiency, which improves NPD performance. This research contributes to the literature by adding understanding of the role of IT in NPD at the firm level in four ways. First, it examines particular organizational complementary resources and their relationship to IT capabilities. Second, it examines the RBV and IT in the context of NPD, an important business process. Third, it measures IT usage in a more granular fashion (i.e., IT tool use frequency and IT replacement frequency) rather than simply IT usage as a dichotomy. Finally, through testing the proposed model with data collected from Japanese firms, this study provides empirical evidence from an Asian country to answer the call for more NPD research to be conducted in countries other than North American and Western European contexts. The findings of the study also provide implications for managers. Importantly, they indicate that an executive level champion for IT is a key influencer in facilitating IT usage and replacement, and likely can help generate awareness of and support for greater IT investments so the firm can create IT capabilities for effective NPD. [ABSTRACT FROM AUTHOR]

Many decision-makers struggle to reduce commitment to failing endeavors. While de-escalation mechanisms have been documented and tested in information technology, accounting, psychology, and organizational behavior, little work has addressed de-escalation in innovation. This study identifies and examines the applicability of de-escalation mechanisms specifically in new product development ( NPD) projects. Initially, we conducted an extensive literature review to identify de-escalation mechanisms found in research across different academic disciplines. Subsequently, we conducted a qualitative study using semistructured interviews to gather primary data. In total, using a sample of organizations that compete in high-technology industries, 31 managers and engineers in 15 NPD projects that were terminated prior to completion were interviewed regarding mechanisms used to de-escalate commitment to failing new product innovation projects. Several mechanisms reportedly used for innovation projects parallel those identified in the previous literature. More importantly, the authors uncover novel and previously undocumented ways to discontinue or redirect poorly performing projects. Specifically, internal competitions, feature-level de-escalation, continual assumption assessment, benchmarking, roadmaps, and comprehensive product testing are particularly well suited for innovation projects. These findings extend the body of extant literature on de-escalation of commitment to include innovation, notably in high-technology settings. The study also highlights that organizations may want to accept or even encourage failure, thereby increasing the efficacy of resource use. Implications for further research and practice are offered. [ABSTRACT FROM AUTHOR]

To source external knowledge, firms in the service area use various sourcing modes simultaneously suitable for their internal needs or external environments. Each external knowledge sourcing mode has distinctive characteristics, and as such, they can offer different advantages and/or disadvantages to the firms. Thus, the effects of external knowledge sourcing on service innovation may vary depending on the sourcing modes. The current study aims to empirically examine the different effects of various external knowledge sourcing modes on service innovation. The study identifies three external knowledge sourcing modes: joint development, technology purchasing, and external information acquisition. Three hypotheses are established to examine the relationships between the extent of utilizing each mode and service innovation performance in terms of new service introduction. The data for analysis are selected from the ' Korean Innovation Survey 2006: Service Sector' ( KIS 2006). It is regarded as South Korea's version of the Community Innovation Survey ( CIS). The KIS 2006 data set covers joint development, technology purchasing, and external information acquisition activities of corporations in the service sector in South Korea. The study empirically analyzes the data set using a negative binomial regression model. The results first demonstrate that the extent of the joint development has an inverted U-shaped relationship with the service innovation performance. Second, the results indicate that, on the other hand, service innovation performance decreases with the increase to the extent of the technology purchasing when the extent is below the threshold. On the other hand, it increases with the increase to the extent of the technology purchasing; this occurs when the extent exceeds the threshold. Third, the results show that external information acquisition has a positive effect on service innovation performance. These findings support that the extent of utilizing each mode has different relationships with service innovation performance. The findings suggest that service firms need to utilize joint development at a moderate level, active technology purchasing, and as much external information acquisition as possible to maximize service innovation performance. In practice, this finding can help managers of service firms select appropriate external knowledge sourcing modes and determine the optimum level of use for each mode. This study also can help firms build up strategies for external knowledge sourcing. [ABSTRACT FROM AUTHOR]

An introduction is presented in which the editor discusses various reports within the issue on topics including the developments in product innovation research, top management diversity, and information technology usage.

With the advances of information technology, online social networks are becoming increasingly important venues for technology adoption. However, although the dynamics of technology adoption in real world social networks have been well documented, technology adoption in online social networks remains relatively under-explored. This study identifies the differences between online and offline social networks and proposes a framework to investigate the dynamics of technology adoption in online social networks. To illustrate the proposed research framework, this study employs behavior-link panel data obtained from an open source software ( OSS) development network to examine how online social networks affect the adoption of Subversion, the latest OSS version control technology. Based on social network theory, co-membership is used to construct online social networks within the OSS development network. Methodologically, this study takes advantage of the panel dataset and addresses the issues of simultaneity and individual heterogeneity that frequently confound the relationship between network structure and adoption decision, and as a result it demonstrates a more compelling relationship between social networks and technology adoption. The results of this study reveal that social networks are major conduits for technology adoption in an online social network in terms of imitation, leadership, lock-in, similarity, recency, and team size effects. In online social networks, one's decision to adopt a new technology is strongly influenced by the actions of the connected others. Project leaders have a stronger influence over other members in technology adoption decision making, even in informal virtual teams where traditional governance structures do not apply. Older projects exhibit stronger inertia and thus lack innovativeness. Similarities among projects facilitate faster adoption, and the effect of leadership attenuates in the networks with increasing project dissimilarity. Recent adoptions of technology within the networks, rather than more distant ones, have a stronger impact on subsequent adoption, implying the salience of memory over usage confidence, and increased size of a project team accelerates the rate of adoption. These results help in understanding the dynamics of technology adoption in online social networks, and provide useful guidelines for firms to promote technology and product innovation. [ABSTRACT FROM AUTHOR]

Emotional capability is considered an emerging phenomenon in the group behavior literature. However, little attention is given to the role of emotional capability in heterogeneous work groups in general and cross-functional product development teams in particular in an empirical context. In this study, the antecedents and results of the emotional capability in software development project teams using Huy's (1999) dynamics of encouragement, displaying freedom, playfulness, experiencing, reconciliation, and identification constructs were investigated. By studying 95 software development project teams in the IT departments of 52 firms, it was found, on the basis of using the Partial Least Squares (PLS) method, that the dynamics of encouragement is positively related to the speed-to-market, and the dynamics of encouragement and experiencing is positively related to the market success of new software products. In addition, it was demonstrated that team autonomy has a positive influence on the dynamics of encouragement; collaboration among team members has a positive impact on the dynamics of encouragement and experiencing; and team experience has a positive effect on the dynamics of experiencing. This study has several theoretical and managerial implications. In terms of theoretical implications, this study enhances the empathy concept by operationalizing it at the team level, i.e., collective empathy, and tests its impact on the project performance. This study also highlights the roles of collective hope, joy, and enthusiasm in a project's performance by empirically demonstrating the benefits of working in a fun environment. Further, this study empirically shows that team emotional capability mediates the relationship between collaboration among team members and market success of the software products, indicating that management and regulation of the emotions acts as a platform to actualize the joint behavior toward some goal of common interest for the successful products. In terms of managerial implications, this study suggests that managers should enhance the team's emotional capability to enhance the project performance. In particular, managers should promote courage, joy, and hope, and increase communication among people to develop collective empathy and the 'liking' of one party for the other. Managers should also promote collaboration and mutual interaction among team members; give autonomy to project team members to make important decisions about the software product; keep control of the project's process to some level; and encourage people to use their previous experience during the projects to increase the team's emotional capability. [ABSTRACT FROM AUTHOR]

Although information technology (IT) tools for new product development (NPD) are widely available, prior studies have found the usage of IT to be limited to large-sized firms (cf. ), but increasing (). Extant research indicates that several factors influence IT usage, including the existence of a champion and NPD process formalization (). In addition, the antecedents to IT usage have been found to vary among countries (); that is, they are context-specific. This study extends prior research by exploring the factors that facilitate and/or inhibit IT usage for NPD in Japanese firms. Japan was chosen for this study because it has been argued that, in order to develop generalized NPD theories applicable across different nations or cultures, further understanding is needed about countries other than North American and Western European countries (). Additionally, the culture of Japan is known for being very different from North America and other Western countries, particularly in terms of Japan's relative emphasis on the collective as opposed to the individual; high in uncertainty avoidance as opposed to low uncertainty avoidance; and long-term orientation rather than short-term orientation (, forthcoming). The lack of research in Japan on IT and NPD implied the need for an exploratory, grounded theory approach to this study. Using a multiple case study method, the authors conducted semi-structured interviews with 35 marketing, R&D, and IT managers and executives in 19 firms in a variety of industries. Based on the analysis of the interview data and the follow-up surveys, the authors propose that ten factors in five categories, namely, strategic factors, market environment factors, development process factors, organizational factors, and technology-human interaction factors, are likely to influence IT usage for NPD in Japanese companies. Specifically, product innovativeness, extent of global engagement, formalized IT ROI measure, standardization of NPD activities, physical proximity, resistance to change, CIO as an executive sponsor, sensory requirements, perceived ease of use, and perceived usefulness are expected to influence IT usage. From a theoretical perspective, this study extends prior research on IT usage by expanding the cultural context beyond North America and Western Europe by focusing on an Asian country, namely Japan. It also adds to the limited research that integrates national culture and NPD and enables the development of a conceptual model that could be tested empirically. [ABSTRACT FROM AUTHOR]

This chapter examines the shape of product design in light of recent and ongoing technological and cultural developments. It presents a trajectory of problems () that have been and are currently fueling design considerations and reviews several stages of the amazing transformations design is undergoing. Based on this history, it comes to the conclusion that the design of 'products' has morphed into the design of increasingly language-like, communicative, and social artifacts and, based on these observations, it develops nine design principles that are and should govern contemporary design. [ABSTRACT FROM AUTHOR]

Although mass customization, a term introduced by Davis (1987) to describe the oxymoron of mass producing customized products, has been part of research for more than a decade, literature has not come up with a commonly accepted definition of this term up to now. The present article attempts to close this gap by proposing a definition of traditional and electronic mass customization, which is based on answering three research questions. First, for which kind of customized goods (products versus services) is mass customization applicable at all? Second, at which step of the value creation process must the customer be given the chance to customize his or her good to be able to speak of mass customization? And finally, which prerequisites in terms of production cost and monetary price need to be fulfilled when comparing mass-customized with mass-produced goods? Using an extensive analysis of extant literature in the field, the authors develop two definitions of traditional mass customization, a working and a visionary one, as well as one for electronic mass customization, stating how new opportunities arising from advances in communication and information technology can influence this concept. [ABSTRACT FROM AUTHOR]

An introduction is presented in which the author discusses various reports within the issue on topics including relationships between alliance and technological capital, the effect of complementary resources on the capabilities of information technology (IT), and the role of finance personnel in new product development NPD) teams.