Research On Relationship Between Open Innovation Network And Latecomer Enterprises’ Catching-up Capabilities

How to improve catching-up capabilities and achieving leapfrog development has been an important proposition in latecomer enterprise research area. Since the Reform and Opening up, Chinese enterprises have been learning hard from the leading enterprises of developed countries, and have greatly improved their competitiveness;thus,the gap between the latecomer enterprises and the leading enterprises has being shrinking. However, since China is still a developing country, and Chinese enterprises are still faced with dual disadvantage of technology and market, how to enhance the technical and market competitiveness is an urgent challenge for Chinese latecomer enterprises.In Economic Globalization era, “the world is flat”. In the “flat world”, Product Life Cycle is getting shorter and shorter,and the market is increasingly competitive,so the technological innovation is not only including internal R&D, but also the research cooperation. Companies must pay more attention to build Open Innovation Networks. How Innovation Networks affect performance is an important research topic. Previous studies have reached fruitful results; however, the conclusions are still conflicting: such as the disputes between “structural holes’ paradox” and “structural holes’ advantages’ ’, “strong ties” and “weak ties”, and the “institutional advantages” and “institutional disadvantages”. These disputes provide some interesting research directions for us.This paper focuses on the issues how Open Innovation Networks impact latecomer enterprises’ catching-up capabilities,and tries to open the mysterious “black box” in which innovation networks acting on the catching-up capabilities. Specifically, this paper will drill down the following three questions:(1) Whether Open Innovation Networks improve the catching-up capabilities;(2) How Open Innovation Networks affect the catching-up capabilities;(3) How Government Support affect catching-up capabilities.In this paper, normative research and empirical research, as well as the qualitative research and the quantitative research are combined. On the basis of previous studies, we build the conceptual model and the hypotheses about whether and how the Open Innovation Networks affect the catching-up capabilities. Then, by the survey data collected from 206 enterprises, and the statistical analysis methods,we test the conceptual model and the research hypotheses.Finally, this study reaches the following three conclusions:(1) Structural holes and strong ties in open innovation network are important for promoting the catching-up capabilities. Latecomer enterprises should actively build and maintain structural holes and strong ties with other members in Open Innovation Networks, so as to continuously improve their catching-up capabilities.(2) Structural holes and strong ties respectively affect the catching-up capabilities through the open innovation; structural holes affect the outbound open innovation through strong ties; structural holes affect the market catching-up capabilities through strong ties. Latecomer companies should maintain strong ties with other members of the innovation network, and actively carry out open innovation activities to improve the catching-up capabilities.(3) Government support plays a positive role. Latecomer enterprises who enhance catching-up capabilities through open innovation, will benefit from supportive policies from the government.The study contributes to our understandings about how Open Innovation Networks affect catching-up capabilities. In particular, this paper may have the following three research contributions:(1) This paper analyse the relationship between Open Innovation Network and the catching-up capabilities based on the perspective of structural holes and strong ties. It is found that structural holes and strong ties in open innovation network are in favor of enhancing the catching-up capabilities. It will be helpful for latecomer companies to build and maintain external innovation networks.(2) In this study, open innovation and strong ties are introduced as mediating mechanism to analyze how the structural holes and the strong ties affect the catching-up capabilities and how the structural holes affect open innovation and the catching-up capabilities. Previous studies paid less attention to this specific mechanism. We found that Innovation Network affect the catching-up capabilities through open innovation, which will help latecomer enterprises design the catching-up strategy by open innovation.(3) In this study, Fiscal and Tax Policy is introduced as moderating mechanism to analyze how government support affect the catching-up capabilities. It is found that government support is helpful for latecomer enterprises,so the latecomer enterprises should size up the situation, and scientifically implement catching-up strategy with the power of government.