DETERMINANTS OF OPEN INNOVATION ADOPTION THE CASE OF POLISH FOOD FIRMS

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1 STOWARZYSZENIE DETERMINANTS OF OPEN EKONOMISTÓW INNOVATION ADOPTION ROLNWA THE CASE I AGROBIZNESU OF POLISH FOOD FIRMS Rocznk Naukowe tom XVI zeszyt Tomasz Kjek Unversty of Lfe Scences n Lubln, Poland DETERMINANTS OF OPEN INNOVATION ADOPTION THE CASE OF POLISH FOOD FIRMS DETERMINANTY STOSOWANIA KONCEPCJI INNOWACJI OTWARTEJ NA PRZYKŁADZIE POLSKICH PRZEDSIĘBIORSTW SPOŻYWCZYCH Key words: open nnovaton, co-operaton, food ndustry, Poland Słowa kluczowe: nnowacja otwarta, kooperacja, przemysł spożywczy, Polska Abstract. The am of ths paper s twofold. Frstly, an attempt s made to analyze the concept of open nnovaton and ts determnants wth partcular regard to food ndustry. Secondly, an nvestgaton of open nnovaton drvers s conducted, usng a small-scale sample of Polsh food frms. The sample conssts of 15 food producers localzed n the Lubln provnce. The Probt model has been used n the analyses. The results reveal that the level of technology and export orentaton are the drvers of co-operaton n nnovaton actvtes. In turn, expendtures on R&D and employees tranng reduce the propensty of enterprses to adopt the open nnovaton approach. Introducton The nnovaton process n many cases does not rely only on a frm s own resources but also ncorporates external knowledge [Kjek 2012]. The dea of knowledge sharng n nnovaton actvty s a buldng block of the concept of open nnovaton. The noton of open nnovaton, ntroduced by Chesbrough [2003], s defned as the purposve nflows and outflows of knowledge to accelerate nternal nnovaton and expand the markets for external use of nnovaton. The need for open nnovaton has emerged due to economc and socal changes,.e. globalzaton, mproved market nsttutons such as ntellectual property rghts, and new technologes [Dahlander, Gann 2010,Matras-Bolbok 2012].To date, open nnovaton has been commonly assocated wth hgh technology sectors, e.g. botechnology and nformaton and communcaton technology. However, there s growng evdence that ths concept may also be appled n tradtonal ndustres such as the food ndustry [Sarkar, Costra 2008]. Acosta et al. [2012] gve a few reasons why food frms rely on external knowledge to support ther own nnovaton. Frst of all, food nnovatons are ntally ntroduced n smaller companes that may lack know-how necessary for commercalzaton. Secondly, knowledge useful for food frms comes from multple scentfc and technologcal sectors, such as pharmaceutcals, chemcals, agrculture, machnery, tools and emergent scentfc felds, e.g. nanotechnology or botechnology. Consequently, the adaptaton of equpment and the use of new technologes developed by upstream (hgh-tech) ndustres allow for changes n producton processes and the creaton of new food products [Zakrzewska 2012]. Accordng to Schroll and Mld [2012], there are three categores of factors that stmulate frms to ntroduce the open nnovaton approach,.e. market and technology-based characterstcs, organzatonal capabltes and human resource capabltes. Table 1. shows the expected mpact of partcular factors on frms propensty to open nnovaton. Although the mpacts of these dentfed factors on open nnovaton have been studed n dfferent ndustres, there s lttle evdence on the drvers of open nnovaton n food frms. As mentoned prevously, frms n the food ndustry have several well-known characterstcs that dstngush them from frms n other ndustres. To address ths gap n lterature, the artcle attempts to verfy the presented assumptons on the drvers of open nnovaton n Polsh food companes.

2 138 Tomasz Kjek Table 1. Drvers of open nnovaton Tabela 1. Determnantynnowacjotwartej Drver/ Determnanta Sze/Welkość Absorptvecapacty/ Zdolność do absorpcj Technology level/ Pozomtechnolog Export orentaton/ Orentacja eksportowa Materal and methods The data used to carry out ths research were gathered wthn the project: Intellectual captal of the Lubln provnce A random sample conssts of 40 food producers (classfed as dvson 10 n Secton C of Polsh Classfcaton of Actvty) localzed n the Lubln provnce. The samplng frame was prepared by the Regonal Statstcal Offce. Face to face ntervews were conducted. All data refer to the year Of our total sample of 40 food producers, 15 respondents were nnovaton-actve, and they were used n our analyses. Consequently, t may cause the problem of sample selecton bas. To fnd the drvers of open nnovaton n the sample frms, the Probt model was appled [Greene 2003]: y = x β ε ' y = 0 f y 0 Descrpton/Ops Large frms are more lkely to undertake collaboratve relatonshps, but they also exhbt not nvented here -NIH syndrome./duże przedsęborstwa są bardzej skłonne do podejmowana dzałań kooperacyjnych, jednak często dośwadczają zjawska ne wynalezono tutaj Investng n R&D and tranng allow external knowledge to become more understandable and usable/inwestycje w dzałalność BR oraz w szkolena pozwalają na lepsze zrozumene wykorzystane wedzy zewnętrznej Applcaton of nformaton and communcaton technology () facltates co-operaton among actors n the nnovaton process/ Stosowane technolog nformacyjno-komunkacyjnych usprawna proces kooperacj pomędzy partneram w procese nnowacyjnym Frms n a low technology envronment should rely more on external knowledge, but hgh-tech envronment creates more possbltes for cooperaton/frmy dzałające w środowsku nskch technolog pownny polegać w wększym zakrese na wedzy zewnętrznej, ale środowsko wysokch technolog stwarza węcej możlwośc do kooperacj Internatonalsaton nduces frms to develop more nnovatve actvtes/ Internacjonalzacja wymusza na frmach wprowadzane nnowacujnych dzałań Impact/ Wpływ Note: postve mpact, - negatve mpact, /- equvocal mpact/uwaga: wpływ pozytywny, - wpływ negatywny, /- wpływ nejednoznaczny Source/Źródło: [Chesbrough 2006,Schroll, Mld 2012] y = 1 f y > 0 where: y s a latent varable mplyng the open nnovaton propensty related to the th frm n the year 2011, x s a vector of regressors and ε s the error term that s assumed to be normally dstrbuted. Table 2 presents the concse descrpton of varables used n the model. To address the potental problem of selecton bas [Mannng et al.1987], the nverse Mll s rato, termed MIL, was ncluded n the man Tobt model as an addtonal ndependent varable. So before runnng the man Probt model, a selecton Probt model had been calculated usng all avalable observatons and consderng the dummy varable.e. whether or not the frm was nnovatve as an ndependent varable. Consstent wth a Schumpeteran tradton, frm sze (SIZE), export orentaton (EXPO_ORIENT), and technology level(tech_lev) were ncluded as explanatory varables. Ths allowed for the calculaton of the nverse Mll s rato, whch reflects the probablty that an observaton wll be selected nto the truncated sample. /- /-

3 DETERMINANTS OF OPEN INNOVATION ADOPTION THE CASE OF POLISH FOOD FIRMS 139 Table 2.Descrpton of the varables (wth varable names) Tabela 2. Ops zmennych (wraz z ch nazwam) Varable/Zmenna Dependent/Zależna Dummy = 1 f the frm has confrmed the co-operaton on nnovaton/sztuczna= 1 OP_INN jeżel frma potwerdzła fakt kooperacj w zakrese nnowacj Independent/Nezależna SIZE Log of number of employees/logarytm lczby zatrudnonych R&D Expendtures on R&D [PLN]/Wydatk na BR [zł] Expendtures on employees tranng connected wth nnovaton actvty [PLN]/ HUM_CAP Wydatk na szkolena pracownków zwązane z dzałalnoścą nnowacyjną [zł] 1 f the frm has declared the possesson of basc software, 2 f the frm has declared the possesson of talor-made software, 3 f the frm has declared the possesson of ntegrated nformaton system/1 jeżel frma zadeklarowała posadane podstawowego oprogramowana komputerowego, 2 jeżel frma zadeklarowała posadane specjalstycznego oprogramowana dostosowanego do proflu frmy, 3 jeżel frma zadeklarowała posadane zntegrowanego systemu nformatycznego 1 f the frm hasdeclared to operate n hgh-tech envronment,2 f the frm has declared to operate n medum hgh-tech envronment, 3 f the frm has declared to operate n medum low-tech envronment, 4 f the frm has declared to operate n low-tech envronment/ 1 jeżel frma zadeklarowała funkcjonowane w środowsku TECH_LEV wysokej technk, 2 jeżel frma zadeklarowała funkcjonowane w środowsku średno wysokej technk, 3 jeżel frma zadeklarowała funkcjonowane w środowsku średno nskej technk, 4 jeżel frma zadeklarowała funkcjonowane w środowsku nskej technk, EXPO_ORIENT Percentage of export sale/udzał procentowy eksportu w sprzedaży Źródło: opracowane własne Results of research Table 3 contans descrptve statstcs of the varables ncluded n the model. The frst concluson to be drawn from the data presented s that the food frms are rather reluctant to take part n open nnovaton adopton,.e. only 5 frms have declared the fact of co-operaton n nnovaton actvtes. It s n lne wth general statstcs on open nnovaton practses n Polsh food ndustry n the years [Dzałalność nnowacyjna ]. As far as expendtures on nnovaton are consdered, the sample frms spend about 20 tmes more (on average) on R&D than on employees tranng. Moreover, most of the Table 3. Descrptve statstcs for the sample of food frms Tabela 3. Statystyk opsowe dla próby przedsęborstw spożywczych Varable/ Zmenna Mn/ Mnmum Max/ Maksmum Mean/ Średna Standard Devaton/ Odchylene standardowe OP_INN SIZE R&D HUM_CAP TECH_LEV EXPO_ORIENT Źródło: opracowane własne food companes have declared to operate n a medum hghtech envronment. Although ths fndng s not consstent wth the OECD classfcaton of manufacturng ndustres nto categores based on R&D ntenstes [Hatzchronoglou1997], t should be nterpreted as a relatve/subjectve categorzaton whch reflects the heterogenety of food ndustry n relaton to technologcal opportuntes.

4 140 Tomasz Kjek Table 4. Parameters estmates for the Probt model Tabela 4. OszcowanaparametrówmodeluProbtowego Varable/Zmenna Coeffcency/ Współczynnk Standard error/błąd standardowy Z-value/ Wartość Z p-value/ Wartość p CONST SIZE x R&D HUM_CAP x TECH_LEV EXPO_ORIENT MIL x McFadden R Lkelhood rato test/ Test lorazu warygodnośc Ch-squared/ch-kwadrat (4) = (p = 0.03) Note: x elmnate dvarable/uwaga: x zmenna wyelmnowana Źródło: opracowane własne Table 4 presents the results of parameter estmates for the Probt model. The maxmum lkelhood estmates of the coeffcents were obtaned va the Newton Raphson method. In order to dentfy a set of explanatory varables whch have consderable predctve capablty, backward elmnaton was employed. Contrary to our expectatons R&D and employees tranng turned out not to be complementary to open nnovaton. Although the coeffcents on these varables are close to zero, they suggest that nternal knowledge and external knowledge are substtutes. An explanaton for ths fndng could be not nvented here NIH syndrome, whch denotes a negatve atttude to knowledge that orgnates from a source outsde the own nsttuton [Lchtenthaler, Ernst 2006]. The results also show that open nnovaton mght be useful for food frms operatng n low technology envronment, snce t allows for the access to new technologes developed by upstream ndustres. What s more there s evdence for the hypothess that exportng ncreases the probablty of cooperatng on nnovaton. It may suggest that nternatonalsaton allows frms to enrch ts sources of knowledge by capturng deas from a greater number of new and dfferent markets. It should be noted that the MIL varable s not sgnfcant, thus the hypothess of sample selecton bas can be rejected. Conclusons Ths paper produces a few mportant contrbutons for the theory and practce on the determnants of open nnovaton. The research results show that the sample frms are generally not wllng to undertake co-operaton n nnovaton actvtes. As stated by Bayona-Sáezet al. [2012], food frms seem to be open n terms of nformal lnkages wth external agents, but when t comes to co-operaton agreements, they appear to be very closed. As regards the drvers of open nnovaton; the level of technology s the most mportant determnant of co-operaton n nnovaton actvtes. Frms whch operate n a low-technology envronment are more eager to ncorporate external knowledge nto the nnovaton process. Furthermore, t appears that nternatonalsaton nduces the frm to engage n co-operaton n nnovaton practces. Unexpectedly, the hypothess on absorptve capacty got lttle support n ths research. The paper s not exempt from some lmtatons. The man drawback pertans to the lmted sample sze. Another shortcomng of the paper concerns a narrow set of determnants of open nnovaton ncluded n the analyss. In order to overcome these lmtatons future research should be based on a larger sample and ncorporate other drvers of open nnovaton (e.g. market based characterstcs).

5 DETERMINANTS OF OPEN INNOVATION ADOPTION THE CASE OF POLISH FOOD FIRMS 141 Bblography Bayona-SáezC., García-Marco T., Sanchez-García M. 2013: The mpact of open nnovaton on nnovaton performance: the case of Spansh agr-food frms, [n:] M.G. Martnez (ed.), Open nnovaton n the food and beverage ndustry, Woodhead Publshng, Phladelpha, Chesbrough H.W 2006: Open nnovaton: A new paradgm for understandng ndustral nnovaton, [n:] H.W.Chesbrough, W. Vanhaverbeke, J. West (eds.), Open Innovaton: Researchng a New Paradgm, Oxford Unversty Press, Oxford, Chesbrough H.W. 2003: The era of open nnovaton, Sloan Management Revew, vol. 44, no. 3, Dahlander L., Gann D.M. 2010: How open s nnovaton? Research Polcy, vol. 39, Dzałalność nnowacyjna przedsęborstw w latach , 2011: GUS, Warszawa, Greene W.H. 2003: Econometrc Analyss, Prentce Hall, New Jersey, Hatzchronoglou T. 1997: Revson of the Hgh-Technology Sector and Product Classfcaton, OECDScence, Technology and Industry Workng Papers, Kjek T. 2012: Innovaton Captal and Its Measurement, J. Entrep. Manag. Innov., vol. 8, no. 4, Lchtenthaler U., Ernst H. 2006: Atttudes to externally organzng knowledge management tasks: a revew, reconsderaton and extenson of the NIH syndrome, R&D Management, vol. 36, Mannng W., Duan N., Rogers W.H. 1987: Monte Carlo evdence on the choce between sample selecton and two-part models, J. Econom., vol. 35, Matras-Bolbok A. 2012: Efektywność współpracy przedsęborstw w zakrese dzałalnośc nnowacyjnej, Prace Naukowe Unwersytetu Ekonomcznego we Wrocławu, nr 262, Sarkar S., Costa A.I.A. 2008: Dynamc of open nnovaton n the food ndustry, Trends n Food Scence & Technology, vol. 19, Schroll A., Mld A. 2012: A crtcal revew of emprcal research on open nnovaton adopton, Journal für Betrebswrtschaft, vol. 62, no. 2, Zakrzewska A. 2012: Wpływ ntegracj z Uną Europejską na dzałalność nnowacyjną przedsęborstw przemysłu spożywczego w Polsce, Zesz. Nauk. SGGW, Problemy Rolnctwa Śwatowego, t. 12(27), no. 2, Streszczene Cel prezentowanego artykułu był dwojak. Po perwsze, w częśc teoretycznej opracowana zaprezentowano koncepcję nnowacj otwartej oraz jej determnant, ze szczególnym uwzględnenem specyfk przemysłu spożywczego. Po druge, w emprycznej częśc pracy skoncentrowano sę na badanu czynnków warunkujących stosowane koncepcj nnowacj otwartej w polskch przedsęborstwach spożywczych. Próba badawcza obejmuje 15 producentów żywnośc prowadzących dzałalność na terene województwa lubelskego. W badanu zastosowano model probtowy. Wynk badań wykazały, że czynnkam stymulującym przedsęborstwa do podejmowana dzałań kooperacyjnych w zakrese nnowacj są możlwośc technologczne oraz orentacja eksportowa. Z kole, prowadzene własnej dzałalnośc BR oraz nwestycje w szkolena pracownków ogranczały skłonność przedsęborstw do stosowana koncepcj nnowacj otwartej. Correspondence address Dr Tomasz Kjek Unversty of Lfe Scences n Lubln Akademcka St. 13, Lubln e-mal: tomasz.kjek@up.lubln.pl