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Chapter 1, Version A OPEN SOURCE INNOVATION IN PHYSICAL PRODUCTS: ADVANTAGES AND DISADVANTAGES, A CORPORATE PERSPECTIVE Mickael Francois Henri Blanc Bsc, MBus, MBA Supervisors: Associate Professor Roxanne Zolin and Dr Henri Burgers Submitted in fulfilment of the requirements for the degree of Master of Business (Research) School of Management, Faculty of Business Queensland University of Technology Australia 2011 i Keywords Innovation, Innovation Management, Open Source, Open Source Hardware, Open Source Innovation, Open Source Software, Product Development, User Innovation. Open Source Innovation in Physical Products: Advantages and Disadvantages, A Corporate Perspective i ii Abstract A better understanding of Open Source Innovation in Physical Product (OSIP) might allow project managers to mitigate risks associated with this innovation model and process, while developing the right strategies to maximise OSIP outputs. In the software industry, firms have been highly successful using Open Source Innovation (OSI) strategies. However, OSI in the physical world has not been studied leading to the research question: What advantages and disadvantages do organisations incur from using OSI in physical products? An exploratory research methodology supported by thirteen semi-structured interviews helped us build a seven-theme framework to categorise advantages and disadvantages elements linked with the use of OSIP. In addition, factors impacting advantage and disadvantage elements for firms using OSIP were identified as: Degree of openness in OSIP projects; Time of release of OSIP in the public domain; Use of Open Source Innovation in Software (OSIS) in conjunction with OSIP; Project management elements (Project oversight, scope and modularity); Firms‟ Corporate Social Responsibility (CSR) values; Value of the OSIP project to the community. This thesis makes a contribution to the body of innovation theory by identifying advantages and disadvantages elements of OSIP. Then, from a contingency perspective it identifies factors which enhance or decrease advantages, or mitigate/ or increase disadvantages of OSIP. In the end, the research clarifies the understanding of OSI by clearly setting OSIP apart from OSIS. The main practical contribution of this paper is to provide manager with a framework to better understand OSIP as well as providing a model, which identifies contingency factors increasing advantage and decreasing disadvantage. Overall, the research allows managers to make informed decisions about when they can use OSIP and how they can develop strategies to make OSIP a viable proposition. In addition, this paper demonstrates that advantages identified in OSIS cannot all be transferred to OSIP, thus OSIP decisions should not be based upon OSIS knowledge. ii Open Source Innovation in Physical Products: Advantages and Disadvantages, A Corporate Perspective iii Table of Contents Keywords .................................................................................................................................................i Abstract .................................................................................................................................................. ii Table of Contents .................................................................................................................................. iii List of Figures ......................................................................................................................................... v List of Tables .........................................................................................................................................vi Statement of Original Authorship ..........................................................................................................ix Acknowledgments ................................................................................................................................... x CHAPTER 1: INTRODUCTION ....................................................................................................... 1 1.1 Background .................................................................................................................................. 1 1.2 Statement of the problem ............................................................................................................. 3 1.3 Theoretical Contribution and practical importance of the study .................................................. 4 1.4 Methodology ................................................................................................................................ 7 1.5 Definitions and scope of research ................................................................................................ 8 1.6 Thesis outline ............................................................................................................................... 9 1.7 Summary .................................................................................................................................... 10 CHAPTER 2: LITERATURE REVIEW ......................................................................................... 11 2.1 Review of the OS literature in the software industry ................................................................. 13 2.2 Definition of Open Source Innovation ....................................................................................... 23 2.3 Advantages and Disadvantages of OSIP for the firm................................................................. 36 2.4 Summary and implication for the firm ....................................................................................... 44 2.5 Research questions and framework ............................................................................................ 45 2.6 Conclusion ................................................................................................................................. 45 CHAPTER 3: RESEARCH METHODOLOGY ............................................................................. 47 3.1 Introduction ................................................................................................................................ 48 3.2 Methodological approach ........................................................................................................... 50 3.3 Data collection method .............................................................................................................. 57 3.4 Validity and reliability ............................................................................................................... 63 3.5 Conclusion ................................................................................................................................. 65 CHAPTER 4: RESULTS: ELEMENTS OF ADVANTAGE AND DISADVANTAGE IN OSIP67 4.1 Background to the repondents projects ...................................................................................... 68 4.2 Key findings ............................................................................................................................... 70 4.3 Comparison of the results with the literature on OSIS ............................................................. 110 4.4 Conclusion on this results section ............................................................................................ 119 CHAPTER 5: RESULTS: FACTORS IMPACTING ELEMENTS OF ADVANTAGE AND DISADVANTAGE IN OSIP ............................................................................................................. 120 5.1 Introduction .............................................................................................................................. 121 5.2 Impact of the firm‟s life cycle .................................................................................................. 123 Open Source Innovation in Physical Products: Advantages and Disadvantages, A Corporate Perspective iii iv 5.3 Industry impacts ....................................................................................................................... 124 5.4 Influence of the firm‟s strategy on advantage and disadvantage elements of osip .................. 126 5.5 How do organisations enhance OSIP? ..................................................................................... 131 5.6 A contingency model could explain advantages and disadvantages of OSIP .......................... 144 5.7 Future research questions regarding OSIP ............................................................................... 147 5.8 Conclusion ............................................................................................................................... 164 CHAPTER 6: IMPLICATIONS AND CONCLUSIONS ............................................................. 165 6.1 Summary of key findings and Contribution to the theory ........................................................ 166 6.2 Implication for management .................................................................................................... 170 6.3 Limitations and suggestions for future research ...................................................................... 173 6.4 Conclusion and recommendations ........................................................................................... 175 GLOSSARY................. ...................................................................................................................... 177 BIBLIOGRAPHY ............................................................................................................................
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