The importance of open innovation in small and medium-sized enterprise in Sweden : A case study of Single Technologies

Abstract: The entrepreneurs behind newly formed companies in Sweden as well as small medium-sized enterprises and start-ups are increasingly getting involved in open innovation or exploring its practices. They do this in order to develop innovative products and services. SMEs and start-ups are collaborating with external stakeholders, such as enterprise service providers, industrial suppliers, research institutions or universities, to either bring their innovative products and solutions to the market faster or to stay ahead of the game of competitions. By engaging in open innovation practices, the different stakeholders involved are able to combine human capital, in addition with a collection of available resources. By reading further into this thesis research, a typical exploration of resources can be noticed spanning from hardware to software and from soft skills to hard skills, thus resulting to innovative outcomes (product and services). This thesis research will investigate the benefits Swedish start-ups and small-medium-sized enterprises can gain from open innovation. There are several studies on large companies that use open innovation to generate additional values. Accordingly, external learning is very important in small and medium-size enterprises for growth. However, there are fewer studies on startups and SMEs, in terms of open innovation; therefore, this research study aims to address this gap. SMEs and open innovation are becoming very important in the local Swedish and global knowledge-based economy. In the past Sweden’s economy, SME played an important role and in the future SMEs are estimated to be more important, due to the rapid technology development and fast-growing services sector. An important contributing fact to the local economy is that 9 out 10 new jobs during the last twenty years were created within the SME sector in Sweden. Accordingly, this study has highlighted the importance of external learning and its contribution towards improving the innovative performance of small and medium-size enterprises. The findings from all interviews and case study revealed different impact about the importance of open innovation. All companies had their respective motivating reasons to explore external resources, while some could attest the resources helped to verify their assumption. Other SME and companies were collaborating with research institutes, academia in order to complement their innovation process, which ended up being a benefit to all parties involved in open innovation.