Implications of open innovation for organizational boundaries and the governance of contractual relations

Item Type	Journal paper
Abstract	To create value in an open innovation context, firms need to increase the permeability of their organizational boundaries to enable knowledge exchange with a broad set of partners. Yet, in order to capture value, firms also need to consider how to govern their cooperative efforts and prevent unintended knowledge leakage. This paper develops a novel framework for researching this “paradox of openness”, which combines an organizational boundary with a relational contract design perspective. First, we extend prior literature by arguing that value is not only created by optimizing resource bundles through external search processes (i.e. competence boundaries). Instead, value can be created by managing interdependencies with external parties (i.e. power boundaries), aligning OI activities with the organization’s identity (i.e. identity boundaries), and coordinating diverse transactions in an OI portfolio (i.e. efficiency boundaries). Second, we propose that relational contract design is an important alternative to formal appropriation regimes and discuss how contractual mechanisms derived from a relational perspective can enable value capture in an OI context. Finally, we discuss how firms can strategically manage configurations of firm boundaries and contract design via a set of dynamic capabilities.
Authors	Zobel, Ann-Kristin & Hagedoorn, John
Journal or Publication Title	Academy of Management Perspectives
Language	English
Subjects	business studies
HSG Classification	contribution to scientific community
Refereed	Yes
Date	2020
Publisher	Academy of Management Perspectives
Volume	34
Number	3
ISSN	1558-9080
ISSN-Digital	1943-4529
Publisher DOI	https://doi.org/10.5465/amp.2016.0175
Depositing User	Prof. Ph.D Ann-Kristin Zobel
Date Deposited	23 Mar 2020 16:27
Last Modified	14 Dec 2020 12:08
URI:	https://www.alexandria.unisg.ch/publications/259719

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Zobel, Ann-Kristin & Hagedoorn, John (2020) Implications of open innovation for organizational boundaries and the governance of contractual relations. Academy of Management Perspectives, 34 (3). ISSN 1558-9080

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https://www.alexandria.unisg.ch/id/eprint/259719

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