Open innovation in SMEs

Purpose The purpose of this paper is to assess the impact of open innovation practices on the innovation capability and export performance of UK small and medium‐sized enterprises (SMEs). Design/methodology/approach The empirical (quantitative) investigation is based on a sample of 64 SMEs in the UK – 33 “open” innovation firms and 31 “closed” innovation firms. Findings The overall results demonstrate that the international competitiveness of SMEs is highly dependent on the cumulative effects and interrelationship between two key internal components, i.e. R&D capacity and managerial structure and competencies, coupled with two external factors, i.e. open innovation practices and the ability of the firm to attract government grants for R&D and technological development. Research limitations/implications Owing to the size of the sample, it has not been possible to undertake research within the context of specific regional disparities and/or sectoral characteristics. Practical implications In order to achieve and sustain competitive advantage in today's global market, SMEs need to collaborate with universities and other firms to advance and commercialise their technologies through “open innovation”. Originality/value Results show that open innovation activities and their impact on the international competitiveness of SMEs are complex and multi‐faceted. Essentially, they are highly related to and dependent upon the cumulative effects of, and interrelationship between, several key internal and external factors. Such factors cannot be fully explored through qualitative approaches as they require more complex and rigorous statistical analyses.