Strategies for Integrating Supplier Knowledge in Innovation – Internal Knowledge Absorption and Joint Knowledge Accumulation

The concept of open innovation emphasizes the importance of inflow and outflow of ideas and resources for the competiveness of the firm. In fact, firms are becoming more and more dependent on external knowledge. Therefore, more insight is required into external knowledge integration strategies in innovation. In this paper we aim to identify, and conceptually characterize, different strategies for knowledge integration with suppliers in innovation. Six buyer-supplier collaborations in new product development (NPD) are studied. These cases represent explorative and exploitive processes for integrating supplier knowledge in the midand high-tech manufacturing industry. The findings indicate that the traditional stage-gate project models are not sufficient for managing open innovation processes. Additional practices and different strategies need to be considered. In this study, two main strategies to manage supplier knowledge in innovation are identified and characterized, namely absorption and accumulation. The first strategy emphasizes the mechanisms for the access of knowledge and the second strategy the joint learning between the buyer and the supplier.