In this paper I ask the basic question highlighted in the title, how does innovative potential and collaborative capacity contribute to a firm’s innovativeness? To address this central question I draw on innovative potential and collaborative capacity as a dynamic notion evaluates the data from India. This paper tries to create a framework creating a sustainable environment for ICT Innovation. To do that I argue that innovative potential and collaborative capacity provide a constellation of inputs to the firm to address both internal and external challenges. For instance while innovative potential works at a project or an individual level while collaborative capacity is seen to work at a firm or perhaps at the inter firm level. This does not mean IP acts only at the locus stated. I conjecture that IP/CC interact with each other at defferent levels, where each takes turn in driving the process of ICT Innovation.
In this paper my endeavor is to explore the meaning and implication of collaberation within a dynamic frame which I refer to a capacity. First I review the collaboration literature from an innovation perspective and then develop a framework that enables me to engage with the data we collected during the Euro-India Innovation Mapping project funded by the European Union under the FP-7 program. The idea is to refine theory and contribute to a better understanding of collaborative as a capacity firms can build creating the environment of collaboration both within and outside. I conclude this paper discussing the new insight on collaborative capacity (CC) of firms and their implications for ICT collaboration and firm innovativness.