Revista del Centro de Investigación de la Universidad La Salle
Vol. 13, No. 47, enero-julio 2017: pp. 13-78
DOI:10.26457/recein.v13i47.1146
Juan MEJÍA-TREJO1
1Coordinación del Doctorado en Ciencias de la Administración Universidad de Guadalajara (MÉXICO)
Correspondance author: juanmejiarejo@gmail.com
Received: 27 febrero de 2017 | Accepted: 17 mayo de 2017 | Published: 15 agosto 2017 |
Copyright © 2017 "Juan MEJÍA-TREJO." This is an open access article distributed under the Creative Commons Attribution License, which permits unrestricted use, distribution, and reproduction in any medium, provided the original work is properly cited.
Purpose. The study is aimed to disclose how Digital Broadband (DBD) is affecting the practice of Open Innovation (OIN) in the Information Technologies Sector of Metropolitan Zone of Guadalajara, Mexico (ITSZMG) to achieve a model, for the improvement of relationships.
Methodology. It is a descriptive, exploratory, correlational, cross-sectional, qualitative-quantitative research. As a qualitative study, it is based on a deep literature review after which, we used Delphi Panel with Analytic Hierarchy Process (AHP), determining our main factors: DBD (1 factor/ 6 variables/43 indicators) and OIN (3 factors/23 variables/161 indicators) in a questionnaire Likert scale, involving 600 ITSZMG specialists at 200 SMEs. The survey was on the period of September-December 2016. As a quantitative study, we applied Confirmatory Factor Analysis using EQS 6.2 software.
-The value of this study, is to propose a generalized model involving the relationship between DBD-OIN for ITSZMG, and identify the underlying variables and their relationships to make suggestions about how to be more innovative, among the firms in the sector.
-Final results: 5/6 DBD variables have significant positive effect on 18/23 OIN variables. This implies opportunities to develop the model.
-Conclusions: We obtained an empirical model capable of identifying its own DBD-OIN relationships in order to be, a more innovative firm in the ITSZMG.
Keywords: Digital Broadband; Open Innovation; Information Technologies; Mexico
Jalisco, Mexico, has the most representative cluster of Information Technologies Sector located into the Metropolitan Zone of Guadalajara, Mexico (ITSMZG), headquarters of the Mexico’s ‘Ciudad Creativa Digital’. The ITSMZG has around 200 IT Firms that export 2,000 million USD annually on high value-added service and generate 20,000 jobs in the state (Economista, 2016). At the same time, Mexico has a Digital Broadband (DBD) recent policy, available since 2013, with 2015 data ranking reports (ITU-UNESCO, 2016) for instance: Fixed-Broadband Subscriptions per 100 inhabitants, ranked in the place 52/138 among other issues; all these data are considered a great opportunity to develop the OIN factor. The DBD even increases the promotion of innovations in small and medium enterprises (SMEs) and the productivity with significant savings by reducing the transaction costs. We remind that the SMEs in Mexico are the main source of jobs because they’re representing the 99.8% of all companies in Mexico, which generates 52% of gross domestic product and 72% of jobs in the country.
We have two remarkable factors, firstly the ITSZMG that is characterized as a sector with advanced OIN practices and secondly the DBD that is considered by the Mexican government as a support and guarantee for its development (Estrategia Digital, 2013). Thus, we determined as a problem, to propose a construct that involves the relationship between the OIN and the DBD, determining and analyzing all the determinant factors related in order to improve all the process of OIN based on DBD to be adapted and applied in the ITSZMG.
So, our research question is posed as: what is the relationship between DBD on OIN in ITSMZG? The rationale of the study is due the ITSMZG interest to know how the main factors of DBD are influencing the OIN process, to identify the weak relationships and to do several suggestions about reinforcement of such relationships proposed, for improvement of the model.
The Specific Research Questions (SRQ) are:
SRQ1. What are the variables proposed for the general conceptual model?
SRQ2. What are the relationships of these variables?
SRQ3. What are the most relevant variables of the model?
The subjects under study were all the 600 ITSMZG specialists, including: SME CEOs (120), back office/ front office managers (120), software designers (120), professors (120) and directors of business consultant firms (120) all of them grouped in the cluster.
To achieve the proposal of variables of the construct, we went through a literature review of more than 40 papers about models regarding the OIN and SMEs, selecting the main factors, variables and indicators of each one, and listed in a matrix table per author. See Table 1.
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Table 1. Authors and variables related with the OIN Factor |
We proceeded to summarize variables vs authors to prepare the account of academic vision. See Table 2.
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Table 2. Variables representing the OIN underlying factor |
After this, we proceeded to the qualitative analysis of this research applying focus group with Delphi Panel and Analytic Hierarchy Process (AHP, Saaty, 1997) to 6 ITSMZG specialists, in the following proportion: (SME CEOs: 1; back office/ front office managers: 1; software designers: 1 and professors : 3 as an academic vision) focusing on everyone´s attention and experience, in order to ask for some suggestions to get the best grouping of factors and variables and the best names to associate them to the OIN and DBD construct. The results were, for the OIN factor: Knowledge Management (KMG), Open Business Models (OBM), and Innovation Ecosystem (IEC). See Table 3.
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Table 3.- Focus Group by Delphi Panel and AHP to determine the main groups of Variables of OIN |
Finally, we used the same procedure for DBD variables, with results showed as: User (USR), Access (AXS), Network (NET), Regulation (REG), Cost & Benefits (C&B), QoS (Quality of Service). See Table 4.
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Table 4.- Panel Delphi and AHP to determine the main group of Variables of DBD |
Thereby, we proceeded to explain every single factor and variable to determine our general conceptual model of OIN, through the literature review. For practical analysis, we excluded the PKMG, POBM and PIEC dimensions due, these are performance key dimensions of each variable. Hence, we proceeded to explain each of these factors and variables to determine our general conceptual model of OIN and DBD, through deep literature review.
The OIN is defined as “a distributed innovation process based on purposively managed knowledge flows across organizational boundaries” (Chesbrough & Bogers, 2014). But, how is affected in the digital era? One of the insights, is the DBD, defined by the OECD (2008a) as: “typically used to denote an Internet connection with download speeds faster than traditional dial-up connections (at 64 kbit/s)” and it is a key driver of economic growth and national competitiveness (Kim, et al.,2010). So, our model proposed here consists in:
According the OECD (2003): “It covers any intentional and systematic process or practice of acquiring, capturing, sharing, and using productive knowledge, wherever it resides, to enhance learning and performance in organizations”. Hence, we propose a model based on a strong leadership (LSP) of its members (OECD, 2003; Mejía-Trejo et al., 2013) able to establish different mechanisms of communications (COM) to transmit the explicit and tacit knowledge, including training the personnel and mentoring the apprentices (T&M) with policies and strategies (P&S) about rewards and incentives to the personnel (INC) in inbound and outbound knowledge frontiers of the Firm (OECD, 2003; Asakawa et al., 2010; Hughes& Wareham, 2010; West& Bogers 2014). For a best knowledge capture and acquisition (KC&A) (Gassman & Enkel, 2004; OECD 2003; Goglio-Primard, & Crespin –Mazet, 2014; Keup & Gassman, 2009), the incentives to the personnel are recommended (OECD, 2003; Allarakhia et al., 2010).
Therefore, our hypothesis is:
H1. The Higher level of DBD, the higher level of KMG in OIN of ITSMZG
We consider the Osterwalder& Pygneur (2010) definition of business model: “A business model describes the rationale of how an organization creates, delivers, and captures value” So, with the increased adoption of open innovation practices, “open business models” have emerged as a new design theme (Chesbrough, 2007; Chesbrough,2007). Therefore, we propose an OBM concept associated with KMG necessary to potentiate the OI Orientation (OIO) by the definition of exploring it, as the experimenting with new alternatives and/or exploiting it, as the refining and extending of the existing knowledge (Chien-Tzu & Wan Fen, 2014,) and what kind of driver is using, such as: the purchase of technology, licensing, purchase of technology, etc. (OECD, 2008b).
The market segmentation (MKS) as basis to define the services and products specialized to offer to the customer (Osterwalder & Pigneur, 2010) and it represents the opportunity to analyze, different applications of the technology besides the current market such as the discovering and developing new markets or for licensing other Firm’s Market (OECD, 2008b; Chesbrough 2003). The value proposition (VP) is the core of any business, so it should be emphasized in different forms, such as: branding, performance, newness, etc. (Osterwalder & Pigneur, 2010; Mejía-Trejo et al., 2013) and make the user a source of innovation to create value, as a tool to capture value (Chesbrough 2003). The customer relationship management (CRM) as a tool, must be applied in different channels (CHN) (own & partners), in all its different forms, such as: personal service, automated-service, selfservice, etc. (Osterwalder & Pigneur, 2010; OECD, 2008b) emphasizing the co-creation (Rayna & Styriukova, 2014) in network. The revenues streams (RIPR) represent a great chance, for the organizations based on de intellectual property rights (IPR) protection as: patents, trademarks and copyrights, for commercializing them using patent pools or crosslicensing portfolios, for instance (OECD, 2008b).
The key resources (KYR) must be recognized (Osterwalder & Pigneur, 2010) involving tangible (buildings, infrastructure, labs, etc) and intangible (data, information, talent personnel, etc.) assets. The Key Activities (KYA) mainly the R&D network, turns out to be more productive based on absorptive capacity features, knowledge and technology (OECD, 2008b). The minimum of the costs (CST), like fixed-cost, variable-cost, economy-scale, economy-scope, etc. (Remneland-Wikhamn & Knights, D. 2012).
The Partnerships (PTS) represents a solid base to do business, involving the relationship University-Government-Organization-Society (Quadruple Helix) (OECD, 2008b, Miller et al., 2016 ) The technology (TEC), due its capacity to incorporate it in an external or internal way to the organization and aimed to the current or different markets (Chesbrough, 2003).The strategy (STR) applied in different ways: Market-Based Innovation; Crowd-Based Innovation Strategies or Collaborative Innovation;Network-Based Innovation Strategies (Gassmann et al.2010) according different final goals to implement, such as: improvement of revenues performance, competitive advantage, or even more, ensure the secrecy, etc. (OECD, 2008b). Finally, the new entrepreneurships (NWE) successfully achieved are a good indicator of any OBM, such as the spin-in, spin-out and spin-off in certain period. (MejíaTrejo, 2017)
Hence, our hypothesis:
H2. The higher level of DBD, the higher level of OBM in OIN of ITSMZG
It is considered as: “a network of interconnected organizations, organized around a focal firm or a platform, and incorporating both production and use side participants, and focusing on the development of new value through innovation” (Autio &Thomas, 2014). This IEC in our model is proposed with the next elements to analyze: Types of risk (RSK) such as: cost, the infringement litigation with other companies in a similar and/or different product markets, etc. (OECD, 2008b). The opportunities (OIEC), based on: the potential on how well knowledge flows and the system is connected, a greater sense of urgency for internal groups to act on ideas or technology (OECD, 2008b, Lichtenthaler 2009). The threats (TIEC) such as: the extra costs of managing co-operation with external partners, the lack of control, the potentially opportunistic behavior of partners, (Goglio-Primard, & Crespin –Mazet,2014), the adverse impact of flexibility, overdependence of partners, etc. (Lichtenthaler, 2009). A system of governance (GOV) capable to be elected and recognized, as a key factor for applying the principles of behavioral rules that support and regulate all the transactions by mean of written rules, the process of election of central governance, establishing roles and responsibilities to take decisions, etc.
Our hypothesis:
H3. The higher level of DBD higher level of IEC in OIN of ITSMZG
One of the insights, is the DBD, defined by the OECD (2008c) as: “typically used to denote an Internet connection with download speeds faster than traditional dial-up connections (at 64 kbit/s)” and it is a key driver of economic growth and national competitiveness (OECD, 2008c; Kim, et al.,2010; Rohrbeck et al. 2009). So, our model proposed here, consists of:
The user (USR), as one of the most important and powerful agent in our conceptual model, because it is an active element involving: surveillance for security/privacy based on protocols and standards, the empowerment of SMEs and users by DBD, the tendency of users with evolving skills to create contents with diversity and new habits in the consumer, (OECD, 2008a; Bianchi et al. 2010) to find out a major communication in your IEC, major communication with the government, etc. increasing the needs of DBD (Wunsch-Vincent & Vickery (2007); Müller-Seitz.& Reger, 2009; OECD, 2006), taking and planning competitive advantage (Kim et al.2010;OECD, 2008b).
About access (AXS), as the ability to connect the backbone network of the telecom operator by mean to use the last mile (wire a non-wireless) (OECD,2008b; Kim et al. 2010) specially asking about Internet: coverage, flexibility, time, speed, cost-benefits ratio, technologies, type of device (fixed and/or mobile). According the network (NET), as the transmission media characterized by: interoperability, speed, connection, with minimum errors (OECD, 2008b; Kim, 2010). The best practices of regulation (REG) by the government (and associations), such as: the actions balance the interests of suppliers and users, protection of IPR about new contents, the promotion of competition in digital model business (OECD, 2006; Biggs & Kelly, 2006) , research & science, education, culture, health, lower prices, etc. providing the greatest benefits for users in different markets, introducing new technologies for access to the net and the universal broadband services (OECD, 2006; Biggs & Kelly, 2006; Sing&Raja (2008). It is a fact about the relation cost per benefits (C&B) increases with regulation and low prices showing in DBD: subscriptions, the network readiness, best offerings of services, etc. (Horrigan & Duggan, 2015; ITU-UNESCO, 2016) with high quality of service standards (QoS) and service level agreements (Kim et al.,2010). Therefore, our hypothesis:
H4. The higher level of DBD, the higher level of OIN of ITSMZG
Hence, we proposed the general conceptual model (see Scheme 1)
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Scheme 1:General Conceptual Model |
Notes: LSP.- Leadership ; T&M.-Training and Mentoring; P&S.- Policies and Strategies; COM.-Communication ; INC.-Incentives ; KC&A.-Knowledge capture & acquisition; OIO.- Open Innovation Orientation; MKS.-Market Segmentation ; VP.-Value Proposition; CRM.- Customer Relationship; CHN.-Channels of Distribution; RIPR.-Revenue Streams for Intellectual Property Rights; KYR.-Key Resources; KYA.-Key Activities; CST.- Cost ; PTS.-Partnership; TEC.-Technology ; STR.-Strategy; NWE.-New Entrepreneurships. RSK.- Risk; OIEC.-Opportunities of Innovation Ecosystem ; TIEC.-Threats of Innovation Ecosystem; GOV.-Governance; DBD.-Digital Broadband; USR.-User; AXS.-Access.-NET.- Network; REG.-Regulation; C&B.-Cost& Benefits; QoS.-Quality of Service
And the Final Questionnaire (see Table 5)
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Table 5. Final Questionnaire |
Notes: LSP.-Leadership ; T&M.-Training and Mentoring; P&S.- Policies and Strategies; COM.-Communication ; INC.-Incentives ; KC&A.-Knowledge capture & acquisition; OIO.-Open Innovation Orientation; MKS.-Market Segmentation ; VP.-Value Proposition; CRM.- Customer Relationship; CHN.-Channels of Distribution; RIPR.-Revenue Streams for Intellectual Property Rights; KYR.-Key Resources; KYA.-Key Activities; CST.- Cost ; PTS.-Partnership; TEC.-Technology ; STR.-Strategy; NWE.-New Entrepreneurships s. RSK.-Risk; OIEC.-Opportunities of Innovation Ecosystem ; TIEC.-Threats of Innovation Ecosystem; GOV.-Governance; DBD.-Digital Broadband; USR.-User; AXS.-Access.-NET.- Network; REG.-Regulation; C&B.-Cost& Benefits; QoS.-Quality of Service.
We started the study involving 600 ITSZMG specialists (including: SME CEOs (120), back office/ front office managers (120), software designers (120), professors (120) and directors of business consultant firms (120) at 200 SMEs all of them grouped in the cluster “Ciudad Creativa Digital) during the period of September-December 2016. The data collection was made through the support of a previous agreement (type: triple helix) among the ITSZMGPROSOFT (Programa para el Desarrollo de la Industria del Software y la Innovación.)- University of Guadalajara. The participants were distributed firstly, in the AHP-Delphi Focus Group, and secondly, in different seminar panels to do the survey of data in four modules: KMG, OBM, IEC and DBD.
We made the quantitative analysis of the research, in order to evaluate the reliability and validity of the measurement scales, using Confirmatory Factor Analysis (CFA) with the maximum likelihood method in EQS 6.2 software (Byrne, 2006). Similarly, the reliability of the proposed measurement scales is evaluated from Cronbach’s alpha coefficient and the composed reliability index (CRI) (Bagozzi & Yi, 1988). All the values from the scale exceeded the recommended level of 0.7 for Cronbach’s alpha as well as the CRI that provides an evidence of confidence that justifies the internal reliability of the scales (Hair et al., 2014). Accordingly, other methods of estimation were used when it is assumed that the normality is present. For this, we followed the suggestions from Chou, et al. (1991) and Hu, et al. (1992) for the correction of the estimation model used. In this way, the robust statistics (Satorra & Bentler, 1988) will be used to provide a better evidence of the statistical adjustments.
The adjustments used, were: the Normalized Adjustment Index (NFI), Not-Normalized Adjustment Index (NNFI), Comparative Adjustment Index (CFI) and the Root Mean Square of Error Approximation (RMSEA) (Byrne, 2006; Hair et al., 2014). The NFI, NNFI and CFI values between 0.80 and 0.89 represent a reasonable adjustment (Segars & Grover, 1993), and a value that is equal or higher to 0.90 is an evidence of a good fit (Byrne, 2006). The RMSEA values that are inferior to 0.080 are acceptable (Hair et al., 2014). The CFA results are presented in Table 6
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Table 6. Internal Consistence and Convergent Validity Evidence of the Theoretical Model |
The theoretical model provides a good fit of data (S-BX² = 453.672; df=405; p < 0.000; NFI = 0.825; NNFI = 0.895; CFI = 0.883; RMSEA = 0.019). As evidence of the convergent validity, the results from the CFA indicate that all the items of the related factors are significant (p < 0.001), the size of all the standardized factorial loads are superior to 0.60 (Bagozzi & Yi, 1988) and the average of the standardized factorial loads of every factor exceed without any problems the value of 0.70 (Hair et al., 2014). Finally, the average variance extracted (AVE) was calculated for every pair of constructs, which results in an AVE that is superior to the 0.50 (Fornell and Larcker, 1981).
In regard to the evidence of discriminant validity, the measurement is given in the following ways:
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Table 7. Discriminant Validity Measuring of the Theoretical Model |
Note: The diagonal represents the AVE, whereas above the diagonal part presents the Variance (the correlation squared). Below the diagonal, is shown the correlation estimation of the factors with a confidence interval of 95%. Source: Own
Based on these criteria, it can be concluded that the different measurements used in this paper show enough evidence of reliability as well as convergent and discriminant validity
In order to prove the hypotheses, a structural equations modeling with EQS 6.2 software by means of CFA of second order was applied (Byrne, 2006) and the theoretical model was analyzed to prove the structure of the model and to get the results that could allow the contrast of the established hypotheses. The nomological validity of the theoretical model was analyzed by the chi-square performance test in which the theoretical model was compared with the measurement model. The results indicate that there are significant differences of the theoretical model are good in the explanation of the relations observed between the latent constructs (Anderson & Gerbing, 1988). See Table 8
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Table 8. Structural Equation Modeling Results from the Theoretical Model |
Mexico is an emerging country and all the best practices about DBD on OIN by the specialist in ITSMZG, are still with insufficient awareness of their practice or even more, they are still ignored. Hence, the importance of this study to identify the strength and weak relationships to determine a general conceptual model able to predict the best correlations and to improve the model. According the final results showed in Table 4 (only the factor loading > 0.6):
Despite all above mentioned, 5/6 DBD factors have positive effect on 18/23 OIN factors
Hence, we concluded the following important issues: