The Effect of Network Position on the Performance of Open Innovation in Service Systems

Abstract

Service systems today provide a platform for open innovation enabling the sharing of service resources with any innovation agents to create new services. While the prior research on service systems for open innovation pioneered the network structure of innovation collaboration, it has also raised the important issue of whether the network position of the service system enhances creativity with static data. In this thesis, it is suggested that the network position of a service network at individual service affects innovation performance, and a time lag exists between those relations. One research question is if the network position affects innovation performance in a service system, what position is good for innovation performance? Furthermore, this thesis explores whether a time lag exists when a network position affects the innovation performance of service systems. To do so, a service system for open innovation through an open Applications Programming Interface (API) is investigated from a network perspective, in which a node and a link represent a software service and the co-development of two software services for a composite service, respectively. And then several software services are selected with high performance and a central position. Cross sectional regression is conducted to test the hypothesis that the network position of services, measured with degree and betweenness centralities, affects their performance, measured by the number of visitors. The data on the network position were gathered from www.programmableweb.com between October 2010 and April 2014, and the performance data from www.alexa.com between November 2013 and May 2014. The results show that network position affects the innovation performance and there exists a time lag in the relation between network position and innovation performance. The results suggest to make the strategy of network position from academic and pragmatic views. Furthermore, findings expected to encourage innovation studies from a network perspective to consider the time lag in the relation between network position and innovation.