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Studies on innovation and innovation management have been constantly growing and getting increasing attention. As a way of categorising, nowadays there are two major streams in this study, namely close versus open innovation. Close innovation is achieved through the use of IT and skills available within an organization (Kondev, Tenchev & Vasileva, 2014). While open innovation encourages knowledge exchanges with the organization’s external parties in order to get the benefit of idea or notion’s generating (Chesbrough 2003: 2006). In reality, no organnizations completely & thoroughly do the  closed innovation (Huizingh, 2010). Organizations always make efforts to utilize various kind of resources, both the internal and external ones, in order to generate innovations (Chesbrough et al., 2006; Enkel, Gassmann & Chesbrough, 2009; Inauen & Wicki, 2012; Lavie, 2006; Mowery, Oxley & Silverman, 1996; West & Lakhani, 2008;).

The approach chosen by an organization in its innovation process is dynamic in its nature  and is influenced by the organization’s level of openness (Makimattila, Melkas & Uotila (2013). It can be seen from the use of different innovation processes  between organizations, either close or  open innovation. However, in this more open era, open innovation approach is more acceptable. The existence of both internal and external interconnection with other companies enables an organization to keep its competitiveness due to the information sharing (Eisenhardt, 1989), and provide advantages in innovating (D’Aveni, 1994). Interconnection encourages sharing of various resources, which will contribute  in increasing the company’s competitiveness (Barney, 1991; Collins & Clark, 2003; Lavie, 2006). Thus, the existence of each company’s efforts to cooperate with each other in order to share their resources, has encouraged them to be more open (Christensen et al.,2005; Rigby and Zook, 2002). The same thing is also stated by Chesbrough (2003), that is: “Not all the smart people work for us. We need to work with smart people inside and outside our company”.

The focus of this paper is to review the open innovation phenomenon. Early review shows that since the introduction of open innovation concept in 2003, human resources aspects received very little attention in open innovation literature. Open innovation has been linked to other aspects such as strategic management and R & D processes (Gassmann, 2010; Gassmann, Enkel & Chesbrough, 2010). This is contrary to the importance of human resources in either the stage of idea development (Amabile, 1996; Nicholson & West, 1988; Nonaka, 1994; West & Farr, 1990; West, Fletcher, & Toplis, 1994) or implementation (West, 2002; West & Farr, 1990) either individually, in group, or within an organization.

Despite individual ability to explore and cooperate, both internally and externally, is important in innovation process, the capability of human resources in generating ideas has its limit (Podmetina et al., 2013). Organizational support is therefore needed to develop the environment and mechanisms that stimulate individual collaborative mentality and capability. In so doing appropriate human resource policies and practices are deemed important.

In order to understand the role of HRM in building an open innovation environment and mechanisms, this paper considers the innovation behaviour approach (see e.g. Scott & Bruce, 1994; Wu, Parker, & Jong, 2011; Yuan & Woodman, 2010). This perspective explains various factors inside or outside of an individual that may influence the ability of individual to innovate, either directly or indirectly. For instance, individuals’ cognitive activities are considered crucial, in order to continually create  and innovate (Cohen, Evans, Stokols, & Krantz, 1986). Another factor is psychological aspect, which has been proven to influence individuals’ ability to innovate (Ford & Gioia, 1995) and collaborate (Cohen & Spacapan, 1878). However, it is understood that individuals need certain conditions for innovation (West, 1987; West & Farr, 1990). External factors are usually considered as influencing the innovation behavior, either directly or indirectly (Amabile, 1983; Matzler & Renzl, 2006; Nicholson & West, 1988; Scott & Bruce, 1994; West, 1987; West, 1994; West & Anderson, 1996). In that case Ekvall (1990) refers to how creative organizational climate can stimulate the creativity and innovativeness of its members.

Besides that, dramatic changes in the organizational environment will encourage innovation process to be done, not only internally but also involving the external ones (open innovation). This raises a question, how innovation behaviour can be modelled in such context. Moolenaar et al (2014) shows that connecting and interacting among individuals, both internally and externally may impact on the collaboration and innovation generated. However, such organizational, group, and individual behavior do not happen automatically. Adequate human resources stance and organizational climate are needed in directing the behavior of relating and collaborating internally and externally, in order to encourage innovation (Cohen & Spacapan, 1878; Ekvall, 1990; West, 1987; West & Farr, 1990).

Eventhough there are quite a number of researches that have broadly reviewed various factors in developing innovative climate, this paper considers it is necessary to emphasize more on the individual level as well as interaction among individuals. Multidimentional as well as multilevel approaches are also necessary, considering that individuals behavior cannot be separated from the role of group and organization, especially in this open innovation era. Thus, review on open innovation needs deeper understanding on how creative climate is generated, either at individual, group, or organizational level. This literature review aims to contribute to the understanding of how hrm may facilitate innovation behaviour within the context of open innovation (Open Innovation Behaviour, OIB) through the development of suitable climate and mechanisms that allow innovation to flourish.