Innovation in the German manufacturing SMEs: current issues, future prospects and potential remedies
Student thesis: Doctoral Thesis
Innovation is one of the key issues in any discussion about the competitiveness of companies in high wage countries such as Germany. It is now well understood that the German industrial SMEs must innovate to successfully compete with foreign businesses, particularly the ones from the emerging markets. Consequently, there is an urgent practical need of high calibre innovation performance, especially by the technology-oriented industrial German SMEs. These considerations lead to the researcher, who himself is the owner-manager of such an enterprise, to think about a new innovation paradigm, the open innovation approach, which could potentially compensate the natural resource constraint disadvantage of SMEs. It is well-known that the open innovation approach has been successfully used principally by the large multinational enterprises. However, in this research, the prospects of its fruitful use by the German industrial SMEs has been investigated. The literature review confirmed that such investigation has not taken place so for at either a scholarly or a practitioner level. This DBA research, therefore, undertook this task. First a thorough literature review was carried out which gave insights into the actual German economic situation, on the business success opportunities that the digitisation has opened up for the businesses as well as the findings of extant research on the open innovation approach. The review considered scholarly outputs, professional and scholarly books, studies of the open innovation approach and measurements systems to gauge the success potential of such an approach. The findings of this research and its recommendations are based on significant data collection and analysis which occurred in three stages. First in depth-semi structured interview of 5 German manufacturing SMEs that were known for their innovation performance were conducted. Then in major data collection exercise a questionnaire survey of 371 German manufacturing using a set of over 100 questions, exploratory information on all aspects of company level innovation management was obtained and then a first-hand experience of use of 7 relevant crowdsourcing platforms was conducted. Interview data was analysed using thematic analysis, quantitative questionnaire survey data was analysed use one sample ‘t' tests as well as regression analysis through IBM-SPSS and the crowdsourcing platforms information was analysed through a detailed SWOT analysis. The results of these three sets of data analyses were brought together to draw fresh insights and propose a new crowdsourcing platform which could potentially facilitate successful use of Open Innovation approach by the German manufacturing SMEs. It is hoped that the conclusions and recommendation of this DBA research effort would inform German government policies on digitisation as well as SMEs support as well as inform German SMEs to shape their own Open Innovation agenda.
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