Abstract
Open innovation is a topic of great importance in new product development research and practice. Firms following open innovation recognize the value of external inputs to the process of new product development and seek to utilize these inputs internally. Proctor and Gamble has shown it is possible to achieve superior outcomes while following open innovation, but it is vital to explore the generalizability of this success. Additionally, it is important to investigate a number types of new product success as open innovation may influence success in different ways. To study this further, I focus on the following five key indicators of new product success: rate of introduction, patent activity, product innovativeness, options creation, and financial performance. Crucial to success in open innovation, is being connected with other firms. It is not only important for firms to follow open innovation, but innovating firms must be able to effectively make and manage interfirm relationships. To evaluate the degree to which firms connect and are connected with other firms, I position interfirm relational knowledge stores and social network characteristics to moderate the link between open innovation and new product success. My findings suggest that open innovation can provide firms with an opportunity to be successful while pursuing open innovation. More importantly, how firms connect and are connected to other firms does have a differential effect on new product outcomes.