Inbound open innovation in financial services

In the existing literature on innovation, financial services firms are attributed with a dependence on external knowledge inputs. Meanwhile, relative importance of sources of knowledge for innovation, modes of knowledge inflow, cooperation partners, advantages and disadvantages of cooperation for innovation remain underexplored. This study has unveiled that the most important internal sources of knowledge for innovation in financial services are frontline employees, new service development teams, bank executives, and backstage staff. Highly valuable modes of knowledge inflow for innovation are human resource development, purchase of equipment, and informal personal interactions. Financial services firms benefit from cooperation for innovation with external partners in the following aspects: increase in customer satisfaction, developed new skills of employees, new technologies, access to knowledge and expertise, decreased costs, and finding a new approach to solve a problem. Costs associated with external cooperation for innovation remain the most influential disadvantage of this mode of inbound open innovation.