The purpose of this paper is to analyze how institutions can facilitate or inhibit radical innovation. The authors argue that organizational radical innovation is necessary to maintain a competitive advantage and to evolve in the market place, and institutions are the basis of this innovation. From an innovation and Service Dominant Logic perspective, network ties are proposed to be a determining factor for the achievement of innovation through institutionalization in the University knowledge management context.A conceptual approach is applied to develop and propose a framework for deepening understanding of radical organizational innovation, institutions and network ties. Data were gathered from Link by UMA-ATech, which in the context of the University of Málaga (Spain) is with great success developing a strategy based on fostering innovation. In all, 22 in-depth interviews were conducted with actors in the Link context, together with additional important second–order data analyses (sector analyses, statistics, company websites). Because of the perceived desirability of innovation, public universities have established a model as part of this strategy in order to foster and develop new businesses through technology transfer. Changing institutional arrangements is the basis of innovation. Opening universities to the actors around them, with an interest in exchanging resources through the evolution of network ties towards a less bureaucratic and more collaborative and open University (tertius iungens) is the basis for reaching organizational radical innovation in the university context to develop the provider-driven radical innovation network structure via the ‘University Living Lab’ theoretical model. A conceptual understanding is used in combination with an empirical approach, in which one case study and 22 organizations are considered in the context of Link-by-UMA ATech, at the University of Málaga.
