Dare to Sell! Impacts of “Make and/or Buy” Decision Strategies on Outbound Open Innovation

Abstract

This study adds to the previous literature on outbound open innovation (OI)—that is, external knowledge commercialization activities—by exploring the effects of “make and/or buy decisions” on outbound OI. Notwithstanding the critical role of outbound OI in shaping firms' competitive advantages, there has been a notable gap in research regarding the drivers of outbound OI. Drawing on the knowledge-based view, this empirical paper addresses this research gap by exploring an array of identified determinates of outbound OI. Through analyzing 468 New Zealand firms, we found that larger and more established firms show a stronger connection between research and development (R&D) investment and outbound OI, whereas smaller firms benefit more from external knowledge sourcing. Additionally, inbound OI positively affects outbound OI, yet the effect diminishes with more international collaborations. Interestingly, small and medium-sized enterprises (SMEs) favor formal appropriation strategies, such as patents and contracts, while larger firms prioritize informal methods, such as secrecy.