Business Model and Open Innovation Conditions for the Sustainable Growth of SMEs

  • JinHyo Joseph Yun
Part of the Management for Professionals book series (MANAGPROF)


The present study is intended to define and clarify the necessary open innovation and business model conditions for the sustainable growth of SMEs (small and medium-sized enterprises). Initially, we create the open innovation and business model conditions for the sustainable growth of SMES. We devise four different conditions for effective business model and knowledge strategies. The highest growth limits of the four conditions were estimated and then measured for 27 SMEs in the area of IT (information technology) in Korea. From this, we attempt to understand the relationship between open innovation and business model in the context of the growth limits of SMEs. Using this context, we can conceive of the relationship between open innovation and business model in a broader and more concrete manner.


Business model Knowledge strategy Open innovation 


  1. Aveni RA (2010) Beating the commodity trap: how to maximize your competitive position and increase your pricing power. Harvard Business School Press, BostonGoogle Scholar
  2. Berkhout G, Hartmann D, Trott P (2010) Connecting technological capabilities with market needs using a cyclic innovation model. R&D Manag 40(5):474–490CrossRefGoogle Scholar
  3. Buenstorf G (2007) Evolution on the shoulders of giants: entrepreneurship and firm survival in the German laser industry. Rev Ind Organ 30(3):179–202CrossRefGoogle Scholar
  4. Carrillo FJ, Batra S (2012) Understanding and measurement: perspectives on the evolution of knowledgebased development. Int Journal Knowl Based Dev 3(1):1–16CrossRefGoogle Scholar
  5. Carrillo FJ (2015) Knowledge-based development as a new economic culture. J Open Innov Technol Market Complex 1(1):1–17CrossRefGoogle Scholar
  6. Cefis E, Marsili O (2005) A matter of life and death: innovation and firm survival. Ind Corp Chang 14(6):1167–1192CrossRefGoogle Scholar
  7. Chesbrough H, Rosenbloom RS (2002) The role of the business model in capturing value from innovation: evidence from Xerox Corporation’s technology spin-off companies. Ind Corp Chang 11(3):529–555CrossRefGoogle Scholar
  8. Chesbrough HW (2003) Open innovation: the new imperative for creating and profiting from technology. Harvard Business Press, BostonGoogle Scholar
  9. Chesbrough H (2007) Business model innovation: it’s not just about technology anymore. Strateg Leadersh 35(6):12–17CrossRefGoogle Scholar
  10. Chesbrough HW, Appleyard MM (2007) Open innovation and strategy. Calif Manage Rev 50(1):57–76Google Scholar
  11. Chesbrough H (2010) Business model innovation: opportunities and barriers. Long Range Plann 43(2):354–363CrossRefGoogle Scholar
  12. Chesbrough H (2011) The case for open services innovation: the commodity trap. Calif Manage Rev 53(3):5–20CrossRefGoogle Scholar
  13. Cooke P (2005) Regionally asymmetric knowledge capabilities and open innovation: exploring ‘Globalisation 2’—a new model of industry organisation. Res policy 34(8):1128–1149CrossRefGoogle Scholar
  14. Creswell JW (2012) Qualitative inquiry and research design: choosing among five approaches. Sage Publications, Los AngelesGoogle Scholar
  15. Desyllas P, Sako M (2013) Profiting from business model innovation: evidence from Pay-As-You-Drive auto insurance. Res Policy 42(1):101–116CrossRefGoogle Scholar
  16. Doganova L, Eyquem-Renault M (2009) What do business models do?: innovation devices in technology entrepreneurship. Res Policy 38(10):1559–1570CrossRefGoogle Scholar
  17. Endres LM, Endres SP, Chowdhury SK, Alam I (2007) Tacit knowledge sharing, self-efficacy theory, and application to the Open Source community. J Knowl Manag 11(3):92–103CrossRefGoogle Scholar
  18. Harison E, Koski H (2010) Applying open innovation in business strategies: evidence from Finnish software firms. Res Policy 39(3):351–359CrossRefGoogle Scholar
  19. Johnson MW, Christensen CM, Kagermann H (2008) Reinventing your business model. Harv Bus Rev 86(12):57–68Google Scholar
  20. Kalpic B, Bernus P (2006) Business process modeling through the knowledge management perspective. J Knowl Manag 10(3):40–56CrossRefGoogle Scholar
  21. Kumar S, Russell RR (2002) Technological change, technological catch-up, and capital deepening: relative contributions to growth and convergence. Am Econ Rev 92(3):527–548CrossRefGoogle Scholar
  22. Lall S (1992) Technological capabilities and industrialization. World Dev 20(2):165–186CrossRefGoogle Scholar
  23. Lee K, Lim C (2001) Technological regimes, catching-up and leapfrogging: findings from the Korean industries. Res Policy 30(3):459–483CrossRefGoogle Scholar
  24. Lopez VWB, Esteves J (2012) Acquiring external knowledge to avoid wheel re-invention. J Knowl Manag 17(1):6Google Scholar
  25. Love JH, Roper S, Bryson JR (2011) Openness, knowledge, innovation and growth in UK business services. Res Policy 40(10):1438–1452CrossRefGoogle Scholar
  26. McEvily B, Marcus A (2005) Embedded ties and the acquisition of competitive capabilities. Strateg Manag J 26(11):1033–1055CrossRefGoogle Scholar
  27. McNichols D (2010) Optimal knowledge transfer methods: a Generation X perspective. J Knowl Manag 14(1):24–37CrossRefGoogle Scholar
  28. Morris M, Schindehutte M, Allen J (2005) The entrepreneur’s business model: toward a unified perspective. J Bus Res 58(6):726–735CrossRefGoogle Scholar
  29. Nelson RR, Winter SG (1982) An evolutionary theory of economic change. Belknap P of Harvard Up, CambridgeGoogle Scholar
  30. Nonaka I, Takeuchi H (1995) The knowledge-creating company: how Japanese companies create the dynamics of innovation. Oxford University Press, New YorkGoogle Scholar
  31. Ordonez de Pablos P (2002) Evidence of intellectual capital measurement from Asia, Europe and the Middle East. J Intellect Cap 3(3):287–302CrossRefGoogle Scholar
  32. Osterwalder A, Pigneur Y (2002) An eBusiness model ontology for modeling eBusiness. BLED 2002 Proceedings, p 2.Google Scholar
  33. Papavassiliou G, Mentzas G (2003) Knowledge modelling in weakly-structured business processes. J Knowl Manag 7(2):18–33CrossRefGoogle Scholar
  34. Peters M, Schneider M, Griesshaber T, Hoffmann VH (2012) The impact of technology-push and demand-pull policies on technical change—does the locus of policies matter? Res Policy 41(8):1296–1308CrossRefGoogle Scholar
  35. Seidman I (2006) Interviewing as qualitative research: a guide for researchers in education and the social sciences. Teachers College Press, New YorkGoogle Scholar
  36. Smith EA (2001) The role of tacit and explicit knowledge in the workplace. J Knowl Manag 5(4):311–321CrossRefGoogle Scholar
  37. Timmers P (1998) Business models for electronic markets. Electron Mark 8(2):3–8CrossRefGoogle Scholar
  38. Van de Vrande V, De Jong JP, Vanhaverbeke W, De Rochemont M (2009) Open innovation in SMEs: trends, motives and management challenges. Technovation 29(6):423–437CrossRefGoogle Scholar
  39. Van der Borgh M, Cloodt M, Romme AGL (2012) Value creation by knowledge-based ecosystems: evidence from a field study. R&D Manag 42(2):150–169CrossRefGoogle Scholar
  40. Wenger E (2004) Knowledge management as a doughnut: shaping your knowledge strategy through communities of practice. Ivey Bus J 68(3):1–8Google Scholar
  41. Wei Choo C, Johnston R (2004) Innovation in the knowing organization: a case study of an e-commerce initiative. J Knowl Manag 8(6):77–92CrossRefGoogle Scholar
  42. Xu J, Houssin R, Caillaud E, Gardoni M (2010) Macro process of knowledge management for continuous innovation. J Knowl Manag 14(4):573–591CrossRefGoogle Scholar
  43. Yigitcanlar T, Metaxiotis K, Carrillo FJ (2012) Building prosperous knowledge cities: policies plans and metrics. Edward Elgar Publishing, CheltenhamCrossRefGoogle Scholar
  44. Yin RK (2008) Case study research: design and methods. SAGE Publications Incorporated, HaidelbergGoogle Scholar
  45. Yun JHJ, Cho BJ (2014) An exploratory study of the economic effect of open innovation. J Sci Technol Policy Manage 5(1):24–40CrossRefGoogle Scholar
  46. Yun JHJ, Park S, Avvari MV (2011) Development and social diffusion of technological innovation cases based on mobile telecommunications in national emergency management. Sci Technol Soc 16(2):215–234CrossRefGoogle Scholar
  47. Yun JHJ, Mohan AV (2012a) Exploring open innovation approaches adopted by small and medium firms in emerging/growth industries: case studies from Daegu–Gyeongbuk region of South Korea. Int J Technol Policy Manage 12(1):1–19CrossRefGoogle Scholar
  48. Yun JHJ, Mohan AV (2012b) The relation between internal and external open innovation: a study of firms located in the Goomi and Banwol-Sihwa clusters in South Korea. In: Brem A, Tidd J (eds) Perspectives on supplier innovation: theories, concepts and empirical insights on open innovation and the integration of suppliers. Imperial College Press, London, pp 257–286CrossRefGoogle Scholar
  49. Yun JHJ, Ryu G (2012) A study on the difference of open innovation effect between modular and non-modular firms in Korea. Asia Pac J Innov Entrepren 6(1):56–72Google Scholar
  50. Yun JHJ, Park S, Lim DW, Hahm SD (2010) Emergence of East Asian TFT-LCD clusters: a comparative analysis of the Samsung cluster in South Korea and the Chimei cluster in Taiwan. Asian J Technol Innov 18(1):201–228CrossRefGoogle Scholar
  51. Yun JHJ, Jung WY, Yang JH (2015) Knowledge strategy and business model conditions for sustainable growth of SMEs. J Sci Technol Policy Manage 6(3):246–262CrossRefGoogle Scholar
  52. Zott C, Amit R, Massa L (2011) The business model: recent developments and future research. J Manag 37(4):1019–1042Google Scholar

Copyright information

© Springer Nature Singapore Pte Ltd. 2017

Authors and Affiliations

  • JinHyo Joseph Yun
    • 1
  1. 1.Tenured Researcher of DGIST and Professor of Open Innovation Academy of SOItmCDaeguKorea, Republic of (South Korea)

Personalised recommendations