THE LIMITS TO INTERNATIONAL OPEN INNOVATION WITHIN SMEs: THE ROLE OF DISTANCE

Abstract

This paper examines the limits to adoption of open innovation (OI) within SMEs in an in-ternational context. In-depth interviews were conducted with managers at 40 Canadian SMEs that operate internationally. The results show that these limits are a function of in-ternational distance, which has cultural, institutional, economic, and geographic dimen-sions. We also found that individual factors (international experience, communication, personal values), organisational factors (economic sector, size, international seniority, international entry mode, available resources, dynamic capabilities, organisational culture), and contextual factors (laws and regulations) can increase or decrease the impact of cultural, institutional, economic, or geographic distance. We contribute to the OI literature by describing the limits to OI in an international context. These findings will help managers identify the limits to their use of international OI, as well as the factors that strengthen or mitigate those limits.