How can Quadruple Helix Relationships be leveraged to create and capture value within University Technology Transfer Business Models?

Background to research Existing conceptualizations of value creation and value capture in open and closed innovation systems have moved beyond the idea of permanence, rigidity or fixed states (Chesbrough, 2010; Appleyard and... [ view full abstract ]

Background to research

Existing conceptualizations of value creation and value capture in open and closed innovation systems have moved beyond the idea of permanence, rigidity or fixed states (Chesbrough, 2010; Appleyard and Chesbrough 2017). In fact, open and closed approaches to innovation rather than consistent trajectories are seen as dynamically changing or on a “dynamically changing continuum” (Appleyard and Chesbrough, 2017: 311) in order to achieve and sustain alignment with rapid environmental and market changes (Fjeldstad et al., 2012; Sabatier et al., 2010). As shown by Appleyard and Chesbrough (2017) and Baldwin and von Hippel (2011), this perspective challenges the binary conflation of value creation being aligned with open innovation and value capture with closed innovation. To date, scholarly attention has predominantly focused on such dynamic interchanges in open source and multiple contributor information systems organizational contexts (e.g. Linux and Cisco, Appleyard and Chesbrough 2017). This attention typically refers to a focal firm (Linux for example), the coordinated contributors broadly described as users (e.g. open developers of Linux codes) and their dynamic interactions in addressing changing market needs (Boudreau and Lakhani, 2009). However, given this somewhat narrow focus, there have been calls for further research where such duopolies and contexts are expanded to involve a wider ecosystem view of multiple mutually influencing stakeholders, including their respective motivations in shaping value creation and value capture (Boudreau and Lakhani, 2009; Appleyard and Chesbrough, 2017).

In order to address this research gap, this paper focuses on one such context, namely the University Technology Transfer (UTT) ecosystem where multiple diverse stakeholders interact to achieve environmental alignment, value creation and value capture within dynamically changing open and closed innovation environments. It is argued by Appleyard and Chesbrough (2017) that failure to maintain a dynamic response in such environments will lead to unsustainability due to failure of appropriate and timely value creation or value capture. In seeking to cognitively and practically represent these dynamics, Baden-Fuller and Morgan (2010) and Boudreau and Lakhani (2009) posit that business model representations can be insightful and appropriate. However, singular business models may have excessive focus on a particular combination of value creation, value capture, open innovation or closed innovation. Hence, emerging research posits the concept of hybrid business models (McAdam et al., 2017; Casadesus-Masanell and Tarijan, 2012) which can co-exist and evolve (McAdam et al., 2017) depending on the dynamic demands of salient stakeholders. Moreover, these demands in some instances may be competing rather than consistent (Huyghe et al., 2014; Hahn and Spieth, 2014) leading to rapidly shifting approaches to the degree of innovation openness and hence impact approaches to value creation and value capture.

Aim and research questions

The aim of this paper is to explore how value creation and value capture within UTT business models are developed through the dynamic interchanges within the Quadruple Helix stakeholder ecosystem. In order to achieve this, the following research questions are explored:

RQ1a. What are the motivations, mechanisms and organisation competencies of each of the QH stakeholders within the Quadruple Helix based UTT? 
 
RQ1b How do these motivations, mechanisms and competencies change in relation to engaging in value capture (closed innovation) and value creation (open innovation) permutations as the UTT innovation develops over time? 

RQ2. How do the dynamics involved in RQ1 shape the development of business model hybridity in a UTT context over time?

Methodology

A qualitative interpretive methodology was followed, involving a longitudinal case study of two differing bounded contexts of universities across 8 years. This was deemed appropriate given that business models in a university context is an under-researched phenomenon. Semi-structured primary interviews, averaging 50 minutes in duration were conducted with purposeful heterogeneous stakeholders (Alvesson and Skoldberg, 2009) for each case university’s UTT process over five data collection periods (2008, 2010, 2012, 2014 and 2017). In total 104 interviews were conducted with 36 diverse stakeholders comprising of principal investigators, business liaison staff, TTO staff, innovation users and government stakeholders. An open inductive data analysis processes was followed resulting in first and 2^nd order themes. An iterative and reflexive process to data analysis was followed whereby data was collected and interpreted through constant referral to literature to aid theory development.

Findings

it was found that the individual motivations of each stakeholder were shaped and modified by their knowledge exchanges and leveraged within the newly formed research and impact and research and enterprise centres which represented an innovation platform (Caloghuriou et al., 2014, Smith et al., 2005).. It was evident in the longtitudinal data that each of the Quadruple Helix stakeholders had aggregate motivations for participating which varied over time (Boudreau and Lakhani, 2009 and McAdam et al., 2017). Variations in aggregate motivations were dependent on the stage of the UTT innovation development degree of open innovation and whether the focus was on value capture or value creation (shown in Figure 1). Indeed, each university appeared to shift between open, closed, value creation and value capture strategies depending on the nature of the technology (cognate versus non-cognate), motivations of the stakeholders, mechanisms available and competencies required (McAdam et al., 2017; Arnkil et al., 2010).  Furthermore, the UTT stage determined the mechanisms utilised which in turn informed a focus on value creation or value capture.

Overall, our empirical findings demonstrated that value capture and value creation necessitate both open and closed innovation leading to a hybrid UTT business model. Furthermore, it was found that identification of value creation with more open innovation business models and value capture with more closed innovation business models was misleading and too simplistic as each UTT business model contained a dynamic interchange between open and closed innovation rather than a binary or static status requiring a portfolio of models to satisfy diverse stakeholder motivations and expectations and ensure sustainability of their UTT processes.  From findings, we develop a conceptual model which represents the complexities of value creation and capture mechanisms during quadruple helix based UTT.

Contributions

First, we contribute to business model theory through our longitudinal perspective on the complexities and challenges of business model hybridity and by unravelling the tensions between value creation and value capture when collaborating with diverse stakeholders. Second, building on this, we make a specific contribution to hybrid business model theory as a result of our focus on business model hybridity in an under researched context, namely the UTT context. This contribution is conceptualised in the provision of our theoretical model which depicts the complexities of business model hybridity where tensions exist between value creation and value capture when collaborating with diverse stakeholders. Third, we contribute to open innovation literature through our exploration of value creation and value capture in a context involving a wider ecosystem view of multiple mutually influencing stakeholders, including their respective motivations in shaping value creation and value capture. Accordingly, as a result of our focus on the UTT stakeholder ecosystem, we extend existing conceptualizations of value creation and value capture, which to date have been confined to open source and multiple contributor information systems organizational contexts.

References

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Appleyard, M.M., and H.W. Chesbrough. 2017. The Dynamics of Open Strategy: From Adoption to Reversion. Long Range Planning 50 (3): 310-321. 

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Baden-Fuller, C., and M. Morgan. 2010. Business Models as Models. Long Range Planning 43 (2/3): 156-171.

Baldwin, C. and E. von Hippel,  2011. Modelling a paradigm shift: From producer innovation to user and open collaborative innovation. Organization Science 22 (6): 1399-1417.

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