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The ups and downs of open innovation efficiency: the case of Procter & Gamble

Chunjia Han (Faculty of Business, University of Greenwich, Chatham Maritime, UK)
Stephen Thomas (Business School, University of Southampton, Southampton, UK)
Mu Yang (Faculty of Business, University of Greenwich, London, UK)
Yongmei Cui (School of Economics and Management, Beijing Jiaotong University, Beijing, China)

European Journal of Innovation Management

ISSN: 1460-1060

Article publication date: 9 October 2019

Issue publication date: 19 November 2019

1842

Abstract

Purpose

Open innovation (OI) has become increasingly popular as an enterprise strategy in both industry and academia, and has been adopted, at least in part, by many companies. Despite this popularity, there is a dearth of evaluation of OI efficiency and a lack of suitable quantitative indices. The paper aims to discuss these issues.

Design/methodology/approach

In this study, the authors used both data envelopment analysis (DEA) and Malmquist techniques to compare the pre- and post-transition levels of performance achievement of Procter & Gamble (P&G), a widely recognised and public early adopter of OI, with a group of its main competitors.

Findings

Most detailed analysis of the time-course revealed that the innovation efficiency of P&G improved rapidly and substantially after its embracing of OI, an effect we term the “open rise”. However, there is also a transient decline in R&D efficiency at the beginning of OI adoption (“open dip”) and an unexpected and marked decline (“open drop”) after the peak positive effect.

Originality/value

The quantitative methods appear to meet the needs identified in the preceding literature for more quantitative approaches to the measurement of OI.

Keywords

Citation

Han, C., Thomas, S., Yang, M. and Cui, Y. (2019), "The ups and downs of open innovation efficiency: the case of Procter & Gamble", European Journal of Innovation Management, Vol. 22 No. 5, pp. 747-764. https://doi.org/10.1108/EJIM-04-2019-0108

Publisher

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Emerald Publishing Limited

Copyright © 2019, Emerald Publishing Limited

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