The realities of innovation strategies within the low- and medium- technology industries. Are open and explorative innovation strategies superior than closed and exploitative?

Abstract: Background: Most of the existing literature regarding innovation and innovation strategies focus on high-tech industries. In contrast low- and medium-technology industries are receiving very little attention despite the category is making up the largest part of the manufacturing industries in OECD countries. The phenomenon could be the result of misconceptions regarding innovation process in low- medium-tech industries and existing pre-eminence of linear model of innovation. Investigating the realities of innovation strategies in the low- and medium technology industries would help crystallise the understanding of innovation strategies within low- and medium technology industries uncovering key factors for innovation under the industry category. Research question: How do organisations under low- and medium-technology industry category innovate and what is the impact the chosen innovation strategy or a combination of innovation strategies have on the organisation? Purpose: The purpose of this study is to understand which innovation strategies (open, closed, exploitative, explorative or a combination of these strategies) organisations under low- and medium technology industry implement and how such innovation strategies impact the organisation. The aim of the study is to crystallise the understanding in how LMTs innovate, which innovation strategies they select and what influences the selection of innovation strategy. Method: Abductive research approach is used for the study. Qualitative research method is a primary source of data gathered from 8 organisations operating under low- and medium- technology industry category. The data was gathered via semi-structured interviews with C- level executives and management responsible for innovation initiatives. Theoretical framework: The literature will present knowledge based view and outline the link between knowledge and open, closed, exploitative and explorative innovation strategies. Findings & conclusion: Ability to identify relevant knowledge and assimilate it drove innovation within the LMTs assessed. Innovation strategies were selected based on understanding of additional information requirements and market environment in their respective markets. Various combinations of innovation strategies were used at the assessed organisations. Some of the assessed organisations used more open or more closed innovation strategies based on business circumstances. Open innovation strategies enabled fast knowledge accumulation and problem solution discovery. Organisational cultures influence the choice of innovation strategies. Peoples’ knowledge drives performance.