The Role of Firm’s Open-Innovation Performance in Firm’s Financial Performance: A Solution to Open-Innovation Challenges Evidence from Textile Industry of Pakistan

Abstract

This study purpose is to test the relationships between licensing & copy rights, relation with external stakeholders, intellectual property management and external knowledge incorporation, firms open innovation performance and firm financial performance, which suggests solution to open innovation challenges in the textile industry of Pakistan. A study was conducted on a sample of 250 managerial staff in the textile sector of Pakistan, using a simple random sampling method. The research model was tested using structural equation modeling (SEM).  The results indicate that intellectual property management and external knowledge incorporation has a positive impact on firm open innovation performance and firm financial performance. Furthermore, result also reveal that licensing & copy rights, relation with external stakeholders have positive impact on intellectual property management and external knowledge incorporation, and that further positively link to on firm open innovation performance and firm financial performance. This study provides help to the management of the organizations to enhance firm financial performance while utilizing the open innovation performance of adopting enterprises as a strategic instrument.