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Open innovation and the management of intra-firm conflict

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  • Pitelis, Christos
  • Panagopoulos, Andreas

Abstract

We analyse the hitherto unexplored relationship between intra-firm conflict between the research and development (R&D) department and central management, conflict alleviation and the choice of ‘open’ versus ‘closed’ innovation, in the context of a simple formal model. We find that in the presence of (intentional or unintentional) divergence of preferred (R&D) output between the R&D department and central management, the decision by central management to adopt an ‘open’ (versus ‘closed’) innovation approach, may help serve the twin purpose of shifting constraints to growth and increasing firm profitability, by alleviating intra-firm conflict.

Suggested Citation

  • Pitelis, Christos & Panagopoulos, Andreas, 2009. "Open innovation and the management of intra-firm conflict," MPRA Paper 23940, University Library of Munich, Germany.
  • Handle: RePEc:pra:mprapa:23940
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    References listed on IDEAS

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    1. Alex Coad, 2007. "Firm growth : a survey," Documents de travail du Centre d'Economie de la Sorbonne r07024, Université Panthéon-Sorbonne (Paris 1), Centre d'Economie de la Sorbonne.
    2. Penrose, Perran & Pitelis, Christos, 1999. "Edith Elura Tilton Penrose: Life, Contribution and Influence," Contributions to Political Economy, Oxford University Press, vol. 18(0), pages 3-22.
    3. David J. TEECE, 2008. "Profiting from technological innovation: Implications for integration, collaboration, licensing and public policy," World Scientific Book Chapters,in: The Transfer And Licensing Of Know-How And Intellectual Property Understanding the Multinational Enterprise in the Modern World, chapter 5, pages 67-87 World Scientific Publishing Co. Pte. Ltd..
    4. Gans, Joshua S. & Stern, Scott, 2003. "The product market and the market for "ideas": commercialization strategies for technology entrepreneurs," Research Policy, Elsevier, vol. 32(2), pages 333-350, February.
    5. Ashish Arora & Andrea Fosfuri & Alfonso Gambardella, 2004. "Markets for Technology: The Economics of Innovation and Corporate Strategy," MIT Press Books, The MIT Press, edition 1, volume 1, number 0262511819, January.
    6. Eaton, B Curtis & Schmitt, Nicolas, 1994. "Flexible Manufacturing and Market Structure," American Economic Review, American Economic Association, vol. 84(4), pages 875-888, September.
    7. Christos N. Pitelis & David J. Teece, 2010. "Cross-border market co-creation, dynamic capabilities and the entrepreneurial theory of the multinational enterprise," Industrial and Corporate Change, Oxford University Press, vol. 19(4), pages 1247-1270, August.
    8. Pitelis, Christos & Teece, David, 2009. "The (new) nature and essence of the firm," MPRA Paper 24317, University Library of Munich, Germany.
    9. James Bessen & Michael J. Meurer, 2005. "The Patent Litigation Explosion," Working Papers 0501, Research on Innovation.
    Full references (including those not matched with items on IDEAS)

    More about this item

    Keywords

    intra-firm conflict; management; open innovation; firm growth;

    JEL classification:

    • M00 - Business Administration and Business Economics; Marketing; Accounting; Personnel Economics - - General - - - General
    • D74 - Microeconomics - - Analysis of Collective Decision-Making - - - Conflict; Conflict Resolution; Alliances; Revolutions

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