Examining Decision-Making of Participating in Open Innovation Platform: The Case of Biotechnology Industry

Abstract

Open innovation is based on a different knowledge landscape, with a different logic about the sources and uses of technologies. It implies that firms increasingly rely on external sources of innovation by emphasizing these ideas and resources. Using datasets from the UK biotechnology industry, this paper explores firms’ willingness to participate in open innovation. The results indicate that the switching cost is identified as the direct predictor of the willingness to participate in open innovation. While high commitment based on the trust with partner increases switching costs, IT infrastructure within the firm decreases switching costs to open innovation. Taken together, this research broadens the study on open innovation by applying the switching cost as a medium of knowledge transfer in the biotech industry.