A social capital perspective on open innovation ecosystems and platform governance

Leckel, Anja; Piller, Frank Thomas (Thesis advisor); Randhawa, Krithika (Thesis advisor)

Aachen (2021)
Dissertation / PhD Thesis

Dissertation, Rheinisch-Westfälische Technische Hochschule Aachen, 2021


Both theory and industry practice have come to acknowledge social exchange as a key driver of innovation, moving away from viewing innovation as a proprietary and mostly entrepreneurial, individual or firm-centric process to a more open and largely social process (Liu et al. 2018). Researchers and practitioners have therefore expanded their focus from internal innovation capabilities to external innovation ecosystems with diverse actors and intricate social relations. Acknowledging the resulting opportunities for knowledge exchange, the notion of open innovation has had a great impact on management research and practice (Chesbrough, 2003; Nambisan et al., 2018). Yet, in order to successfully manage and sustain knowledge exchange in an open innovation ecosystem, it is important to identify appropriate governance mechanisms that promote social exchange in a way that benefits all parties involved (Kohler, 2015).This dissertation investigates open innovation ecosystems and platform governance from the lens of social capital theory. With regard to search distance and social ties, the advent of digitization has decoupled network building from geographically restricted regional ecosystems and has increased the opportunities to make geographically unrestricted connections via digital means (Nambisan et al., 2017). While local approaches are limited in outreach, they provide potential for deeper and more trusting connections. In contrast, digital approaches provide easy access to a wide range of ideas and highly specialized knowledge on a global scale, but the connections tend to be superficial in nature. For open innovation management, both local and digitally enabled global platforms provide vast opportunities to make novel and important connections. Both approaches enable seekers to overcome different hurdles in finding external knowledge, but also bring different challenges. My thesis explores these two overarching research themes of local and digitally enabled global open innovation platforms. The first theme examines a “local open innovation” (LOI) approach that – fostered by different innovation intermediaries and social capital – enables organizations to open up to external ideas (Essays I and II). The local context facilitates to uncover the social dynamics of the open innovation process and its success factors. The second theme explores governance structures and platform design parameters for building social capital in the digital context. Essays III and IV are of quantitative nature and build on the qualitative findings of the first two studies. Overall, I seek to adapt the concepts that explain social dynamics in the local context to the digital realm, where maintaining knowledge exchange proves more difficult due to the lack of social ties or a shared common background. In Essay I, focusing on public actors as network promoters, I derive policy implications for implementing LOI as an instrument for facilitating regional innovation ecosystems. Essay II takes a close look at how spatial proximity supports seekers and solvers in benefitting from the local open innovation approach and concludes with a conceptual framework based on social capital theory. Both essays are backed by qualitative primary data and comprehensive secondary data sources, triangulating perspectives across stakeholder groups and multiple local events. In sum, my empirical findings of the first research theme demonstrate that social capital is the key success factor for the local open innovation approach, enabling seekers and solvers to open up to new valuable connections outside their current network and across industries, boosting mutual understanding and building trustful relationships for collaborative solution implementation. However, the “predominantly local nature of social capital” is also the main reason why building social capital underlies challenges in the context of virtual collaboration (Lorenzen, 2007, p. 810). On digital open innovation platforms, the spatial and temporal offset deprives seekers and solvers of face-to-face interactions, leading to barriers in the development of social capital (Dissanayake et al., 2014), and initially weaker ties (Striukova & Rayna, 2008). Therefore, in Essay III, I address the challenge of building social capital in the context of digital open innovation platforms. The innovation intermediary, striving to sustain the digital platform through appropriate governance structures and design, thus comes into focus (Foege et al., 2019; Pollok et al., 2019). My empirical study is based on survey data from C-level managers of open innovation platforms to test my hypotheses. In Essay IV, I further examine the preferences of seekers and solvers for designing social exchange on digital open innovation platforms. More precisely, I conduct a discrete choice experiment with 842 respondents to study the differences in individual preferences for platform interaction design features. Both data collections are backed by multiple qualitative and quantitative pre-studies. In Essay III, I identify antecedents and mechanisms for building social capital on digital open innovation platforms. As a result of Essay IV, I contribute individual-level findings on seekers’ and solvers’ interaction design preferences for social exchange. As a key theoretical contribution, I extend a conceptual framework for open innovation value processes.