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Purpose – The present paper adds to the most recent current of\udliterature that highlights the importance of innovation in services,\udanalyzing a setting – Portugal – which is relatively backward in terms of innovation performance.\ud\udDesign/methodology/approach – Based on a sample of 4128\udcompanies (including 1489 service companies) that answered the\udCommunity Innovation Survey 2008, we assessed, by resorting to\udlogistic regressions, the determinants of innovation performance in Portuguese companies.\ud\udFindings – 1) Workers who have the 1st cycle of higher education\udhave a positive and significant impact on the innovation of service\udcompanies whereas PhDs are detrimental to companies’ innovative performance; 2) Companies in the service sector in general, and in KIBS in particular, that effectively invest in external and (continuous) internal R&D activities are more innovative; 3) External scientific sources of information for innovation are crucial (and much more than in manufacturing) to the innovation performance of service companies, especially of KIBS; 4) Similarly to manufacturing, participation in innovation activities in cooperation with foreign partners appears as a\udkey factor in the innovative performance of service companies.\ud\udOriginality/value – The study demonstrates the influence of\udcompanies’ openness and the relative importance attributed to different sources of information for innovation on innovation outcomes of service companies (and KIBS) compared to manufacturing industries

Innovation performance in service companies and KIBS vis-à-vis manufacturing: the relevance of absorptive capacity and openness