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In a qualitative and quantitative study of firm-developed innovations with embedded linux, henkel 2006 ; shows that companies are aware of this dilemma and use different means to protect their code. they reveal about half of the code they develop, depending on how important the need for obtaining external support in the development work is. the more support is needed, the more code is revealed. smaller firms with less internal resources thus reveal more. the author further argues that firms practice selective revealing to minimize competitive loss. this is consistent with profitmaximization behaviour henkel, 2006 ; . hurmelinna, kylheiko and jauhiainen 2005 ; claim that the question on whether to be protective or to externally exploit new knowledge is twofolded. they use the term appropriability regime to discuss exploitation of knowledge assets and sustain competitive advantage. the strength or weakness of the regime in the protective sense may turn out to be both useful and harmful, depending on the situation the company is facing. the results show that in most appropriability issues, an intermediate position emphasising the means of legal protection might turn out to be the most effective strategy, and may provide the company with more control and various alternatives to react proactively to emerging opportunities. 2.2.7 industrial dynamics and manufacturing so far, the notion of open innovation has mainly focused on the company level and less on the network or industry level where the benefits for the focal firm is discussed jointly with those for the collaborating organizations. according to vanhaverbeke 2006 ; there is a need to address a broader scope of analysis. christensen, olesen and kjaer 2005 ; place the concept of open innovation in the context of industrial dynamics and applied evolutionary economics. berkhout et al. 2006 ; also point out, on a general level, the necessity of a cyclical model of innovation and argue that our society now has four production factors, capital, labour, knowledge and creativity, enabling the "innovation economy". christensen and his colleagues 2005 ; further argue that firms manage open innovation in regards to an innovative technology in different ways depending on 1 ; their position in the innovation system 2 ; the stage of maturity of the technological regime and 3 ; the value proposition pursued by the companies and that there are many challenges to investigate further in the interplay between technology entrepreneurs and incumbents where open innovation are often played out under conditions of high transaction cost. cooke 2005 ; takes a regional innovation system perspective and argues that in order to overcome intra-firm knowledge asymmetries, firms tap into.
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