The impact of internal and external technology sourcing on innovation performance: a review and research agenda
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paper_title: External Technology Sourcing Through Alliances or Acquisitions: An Analysis of the Application-Specific Integrated Circuits Industry

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In today's turbulent business environment innovation is the result of the interplay between two distinct but related factors: endogenous R&D efforts and (quasi) external acquisition of technology and know-how. Given the increasing importance of innovation, it is vital to understand more about the alternative mechanisms--such as alliances and acquisitions--that can be used to enhance the innovative performance of companies. Most of the literature has dealt with these alternatives as isolated issues. Companies, however, are constantly challenged to choose between acquisitions and strategic alliances, given the limited resources that can be spent on research and development. This paper contributes to the literature because it focuses on the choice between innovation-related alliances and acquisitions. We focus on the question of how the trade-off between strategic alliances and acquisitions is influenced by previous direct and indirect ties between firms in an industry network of interfirm alliances. We formulate hypotheses pertaining to the number of direct ties between two companies, their proximity in the overall alliance network, and their centrality in that network. In so doing, we distinguish between ties that connect firms from the same and from different industry segments, and those that connect firms from the same or from different world regions. These hypotheses are tested on a sample of strategic alliances and acquisitions in the application-specific integrated circuits (ASIC) industry. The findings show that a series of strategic alliances between two partners increases the probability that one will ultimately acquire the other. Whereas previous direct contacts tend to lead to an acquisition, this is not true of previous indirect contacts, which increase the probability that a link between the companies, once it is forged, takes the form of a strategic alliance. In the case of acquisitions, firms that are more centrally located in the network of interfirm alliances tend to be acquirers, and firms with a less central position tend to become acquired. These findings underscore the importance of taking previously formed interfirm linkages into account when explaining the choice between strategic alliances and acquisitions, as these existing links influence the transaction costs associated with both alternatives.
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paper_title: External technology sourcing and innovation performance in LMT sectors: An analysis based on the Taiwanese Technological Innovation Survey

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This paper presents the strategies that low- and medium-technology (LMT) firms adopt to generate technological innovation and investigates the impact of these approaches on the firms' innovation performances. These analyses are based on a sample from the Taiwanese Technological Innovation Survey totalling 753 LMT firms. The descriptive statistics show that about 95% of the firms acquired technology by technology licensing, while 32% of the firms engaged in R&D outsourcing. The firms in the sample acquiring external technological knowledge through collaboration with suppliers, clients, competitors, and research organizations are about 20%, 18%, 8%, and 23%, respectively. Using a moderated hierarchical regression analysis, this study reveals interesting results. First, inward technology licensing does not contribute significantly to innovation performance. Second, internal R&D investment negatively moderates the effect of R&D outsourcing on innovation performance. Third, internal R&D investment contingently impacts the different types of partners on innovation performance: by collaborating with different types of partners, firms with more internal R&D investment gain higher innovation returns than firms with fewer internal R&D activities. The results of this study contribute to a sharper understanding of technological innovation strategies and their effects on technological innovation performance in LMT sectors.
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paper_title: Collaboration and innovation: a review of the effects of mergers, acquisitions and alliances on innovation

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Over the past decades, a strong upheaval in the use of alternative forms of organization gave way to increased attention in the academic literature to the performance effects of, in particular, strategic alliances and mergers and acquisitions (M&A). Whereas mergers and acquisitions and strategic alliances are primarily known for their ability to facilitate entry into new markets and their effectiveness in achieving scale and scope economies we would like to focus on their effects on the innovative performance of companies involved. In spite of the vast and rapidly growing body of literature on the use and structure of strategic alliances and mergers and acquisitions, there are hardly any studies that address the question of whether one mode of partnering is superior to the other in terms of strengthening the innovative capabilities of the partners involved. Moreover, no extensive review of the empirical literature on this specific research topic is available. Given the growing importance of innovation for the competitive position of companies (Porter, 1990) and the fact that innovation is shown to be one of the driving forces of 20th century growth (Franko, 1989) it is of eminent importance that we study the effect of alternative governance mechanisms on the innovative performance of companies (Vanhaverbeke et al., 2002). Since, no general conclusions have been drawn based on the existing literature, knowledge accumulation is inhibited. It is unclear which research questions have already been answered and which are still open for further exploration. The lack of a coherent overview also implies that practitioners have no empirically validated guidelines when preparing for the best mode of organizing for innovation. Should managers opt for M&A or an alliance if they intend to increase innovation? What specific circumstances affect this choice? What type of alliance is best suited to a particular situation? The absence of an exhausting overview of empirical findings so far, makes it impossible to even begin answering these questions. Hence, there is a necessity for a review of empirical studies on the effect of M&A versus alliances on innovation.
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paper_title: AN EVOLUTIONARY PERSPECTIVE ON DIVERSIFICATION AND CORPORATE RESTRUCTURING: ENTRY, EXIT, AND ECONOMIC PERFORMANCE DURING 1981-89

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This study proposes a theoretical perspective that firms engage in continuous search and selection activities in order to improve their knowledge base and thereby improve their performance. This general framework is applied to the context of corporate evolution. Entry and exit activities are understood as search and selection undertaken by the firm to improve their performance. One of the compelling features of this framework is that firms learn from their past entry experience and approach the next entry in a more focused and directed manner over time. Also, firms acquire additional knowledge from each entry event while applying their existing knowledge base. With a longitudinal (1981-89) data base on entry and exit activities of all publicly traded manufacturing firms in the United States, this study shows that applicability of the firm's knowledge base plays an important role in predicting which businesses a firm enters or exits. Finns sequentially enter businesses of similar human resource profiles and firms are more likely to divest lines of business of different profiles. Corporate-level analysis shows that such well-directed entry and exit contribute to the improvement of a firm's profitability.
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paper_title: The Effect of Governance Modes and Relatedness of External Business Development Activities on Innovative Performance

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This study examines how different governance modes for external business development activities and venture relatedness affect a firm's innovative performance. Building on research suggesting that interorganizational relationships enhance the innovative performance of firms, we propose that governance modes and venture relatedness interact in their effect on innovative performance. Analyzing a panel of the largest firms in four information and communication technology sectors, we find that degree of relatedness for corporate venture capital investments, alliances, joint ventures, and acquisitions influences their impact on innovative performance. Copyright © 2008 John Wiley & Sons, Ltd.
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paper_title: Network location and learning: the influence of network resources and firm capabilities on alliance formation

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This paper presents a dynamic, firm-level study of the role of network resources in determining alliance formation. Such resources inhere not so much within the firm but reside in the interfirm networks in which firms are placed. Data from extensive fieldwork show that by influencing the extent to which firms have access to information about potential partners, such resources are an important catalyst for new alliances, especially because alliances entail considerable hazards. This study also assesses the importance of firms’ capabilities with alliance formation and material resources as determinants of their alliance decisions. I test this dynamic framework and its hypotheses about the role of time-varying network resources and firm capabilities with comprehensive longitudinal multi-industry data on the formation of strategic alliances by a panel of firms between 1970 and 1989. The results confirm field observations that accumulated network resources arising from firm participation in the network of accumulated prior alliances are influential in firms’ decisions to enter into new alliances. This study highlights the importance of network resources that firms derive from their embeddedness in networks for explaining their strategic behavior. Copyright © 1999 John Wiley & Sons, Ltd.
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paper_title: Managing Mergers Across Borders: a Two-Nation Exploration of a Nationally Bound Administrative Heritage

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Top managers of British and French firms, which were recently acquired by either British or French firms, were surveyed as to their perceptions of the administrative approach-reflected in integrating mechanisms-used by the acquiring firms to establish headquarters-subsidiary control. Four types of integrative mechanisms were examined: structural, systems, social, and managerial. A multiple analysis of covariance model, coupled with a two-nation (British and French), two-merger type (domestic, cross-national) sampling design, found evidence that the administrative approaches used by managers during merger integration from two nations partially reflect their different heritages, and that these differences are consistent with national differences and the theoretical perspectives of institutional development and cross-cultural studies. Our findings, while exploratory, provide insight into the administrative difficulties of managing across borders and help us understand why many cross-national firms continue to use ethnocentric approaches in spite of the incentives for adopting a transnational approach. Moreover, our findings add one more voice to a growing chorus calling for a theory of the firm, as embedded, institutionally, culturally, and historically.
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paper_title: Overcoming Local Search Through Alliances and Mobility

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Recent research suggests that, due to organizational and relational constraints, firms are limited contextually--both geographically and technologically--in their search for new knowledge. But distant contexts may offer ideas and insights that can be extremely useful to innovation through knowledge recombination. So how can firms reach beyond their existing contexts in their search for new knowledge? In this paper, we suggest that two mechanisms--alliances and the mobility of inventors--can serve as bridges to distant contexts and, thus, enable firms to overcome the constraints of contextually localized search.Through the analysis of patent citation patterns in the semiconductor industry, we first demonstrate both the geographic and technological localization of knowledge. We then explore if the formation of alliances and mobility of active inventors facilitate interfirm knowledge flows across contexts. We find that mobility is associated with interfirm knowledge flows regardless of geographic proximity and, in fact, the usefulness of alliances and mobility increases with technological distance. These findings suggest that firms can employ knowledge acquisition mechanisms to fill in the holes of their existing technological and geographic context.
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paper_title: Multinational Corporations and European Regional Systems of Innovation

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In globalising economies, particularly those going through a process of economic integration such as those economies within the EU, regions forge an increasing number of linkages with other locations within and across national borders. This is largely carried out by the technological efforts of Multinational Corporations (MNCs). This book explores the regional dimension of Europe in terms of localised technological comparative advantages and the location of innovative activities by MNCs. Using an empirical analysis John Cantwell and Simona Iammarino cover such important themes as: *MNC technological activities and economic wealth *MNCs and the regional systems of innovation in Italy, UK, Germany and France *the geographical hierarchy across European national borders.
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paper_title: Towards understanding who makes corporate venture capital investments and why

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This study examines when established firms participate in corporate venture capital (CVC). We build on the resource-based view of interfirm collaboration and emphasize the strategic flexibility of CVC relationships. We use longitudinal data on 477 firms from 1990 to 2000 to test our hypotheses. We find that firms in industries with rapid technological change, high competitive intensity and weak appropriability engage in greater CVC activity. We also show that firms that possess strong technological and marketing resources and resources developed from diverse venturing experience engage in greater CVC activity. Finally, we find that these firm resources moderate the influence of the observed industry effects in paradoxical ways.
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paper_title: Evolutionary trajectories in petroleum firm R&D

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Tacit knowledge and cumulative learning underlie an evolutionary theory of business firm development and strategy. As one test case of the theory, this study examines firms' applied research and development activities. Evolutionary theory suggests that firms within an industry will tend both to persist and to differ in the amount of effort they devote to various R&D applications. A test of the hypothesis of presistent differences in R&D, using uniquely detailed data from the petroleum industry, provides support for evolutionary theory.
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paper_title: Something Old, Something New: A Longitudinal Study of Search Behavior and New Product Introduction

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We examine how firms search, or solve problems, to create new products. According to organizational learning research, firms position themselves in a unidimensional search space that spans a spectrum from local to distant search. Our findings in the global robotics industry suggest that firms' search efforts actually vary across two distinct dimensions: search depth, or how frequently the firm reuses its existing knowledge, and search scope, or how widely the firm explores new knowledge.
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paper_title: Innovation Management Measurement: A Review

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Measurement of the process of innovation is critical for both practitioners and academics, yet the literature is characterized by a diversity of approaches, prescriptions and practices that can be confusing and contradictory. Conceptualized as a process, innovation measurement lends itself to disaggregation into a series of separate studies. The consequence of this is the absence of a holistic framework covering the range of activities required to turn ideas into useful and marketable products. We attempt to address this gap by reviewing the literature pertaining to the measurement of innovation management at the level of the firm. Drawing on a wide body of literature, we first develop a synthesized framework of the innovation management process consisting of seven categories: inputs management, knowledge management, innovation strategy, organizational culture and structure, portfolio management, project management and commercialization. Second, we populate each category of the framework with factors empirically demonstrated to be significant in the innovation process, and illustrative measures to map the territory of innovation management measurement. The review makes two important contributions. First, it takes the difficult step of incorporating a vastly diverse literature into a single framework. Second, it provides a framework against which managers can evaluate their own innovation activity, explore the extent to which their organization is nominally innovative or whether or not innovation is embedded throughout their organization, and identify areas for improvement.
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paper_title: Towards a Methodology for Developing Evidence-Informed Management Knowledge by Means of Systematic Review

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Undertaking a review of the literature is an important part of any research project. The researcher both maps and assesses the relevant intellectual territory in order to specify a research question which will further develop the knowledge hase. However, traditional 'narrative' reviews frequently lack thoroughness, and in many cases are not undertaken as genuine pieces of investigatory science. Consequently they can lack a means for making sense of what the collection of studies is saying. These reviews can he hiased by the researcher and often lack rigour. Furthermore, the use of reviews of the available evidence to provide insights and guidance for intervention into operational needs of practitioners and policymakers has largely been of secondary importance. For practitioners, making sense of a mass of often-contrad ictory evidence has hecome progressively harder. The quality of evidence underpinning decision-making and action has heen questioned, for inadequate or incomplete evidence seriously impedes policy formulation and implementation. In exploring ways in which evidence-informed management reviews might be achieved, the authors evaluate the process of systematic review used in the medical sciences. Over the last fifteen years, medical science has attempted to improve the review process hy synthesizing research in a systematic, transparent, and reproducihie manner with the twin aims of enhancing the knowledge hase and informing policymaking and practice. This paper evaluates the extent to which the process of systematic review can be applied to the management field in order to produce a reliable knowledge stock and enhanced practice by developing context-sensitive research. The paper highlights the challenges in developing an appropriate methodology.
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paper_title: The Effects of Personal and Contextual Characteristics on Creativity: Where Should We Go from Here?

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This article systematically reviews and integrates empirical research that has examined the personal and contextual characteristics that enhance or stifle employee creativity in the workplace. Based on our review, we discuss possible determinants of employee creativity that have received little research attention, describe several areas where substantial challenges and unanswered questions remain, present a number of new research directions for theory building, and identify methodological improvements needed in future studies of creativity in organizations.
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paper_title: A Multi-Dimensional Framework of Organizational Innovation: A Systematic Review of the Literature

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This paper consolidates the state of academic research on innovation. Based on a systematic review of literature published over the past 27 years, we synthesize various research perspectives into a comprehensive multi-dimensional framework of organizational innovation – linking leadership, innovation as a process, and innovation as an outcome. We also suggest measures of determinants of organizational innovation and present implications for both research and managerial practice.
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paper_title: PERSPECTIVE: Ranking the Technology Innovation Management Journals*

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A citation analysis of the 10 leading technology and innovation management (TIM) specialty journals is conducted to gain insights into the relative ranking of the journals. The journals are ranked based on number of citations, citations adjusted for publication frequency, citations corrected for age, citations corrected for self-citation, and an overall score. The top 50 journals in management of technology based on citation analysis are listed. Overall, the top 10 journals based on citation analysis are Journal of Product Innovation Management, Research Policy, Research-Technology Management, Harvard Business Review, Strategic Management Journal, Management Science, Administrative Science Quarterly, RD how the journals relate to each other and the related implications of these findings are considered.
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paper_title: Leveraging External Sources of Innovation: A Review of Research on Open Innovation

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This article reviews research on open innovation that considers how and why firms commercialize external sources of innovations. It examines both the “outside-in” and “coupled” modes of Enkel et al. (2009). From an analysis of prior research on how firms leverage external sources of innovation, it suggests a four-phase model in which a linear process — (1) obtaining, (2) integrating and (3) commercializing external innovations — is combined with (4) interaction between the firm and its collaborators. This model is used to classify papers taken from the top 25 innovation journals identified by Linton and Thongpapan (2004), complemented by highly cited work beyond those journals. A review of 291 open innovation-related publications from these sources shows that the majority of these articles indeed address elements of this inbound open innovation process model. Specifically, it finds that researchers have front-loaded their examination of the leveraging process, with an emphasis on obtaining innovations from external sources. However, there is a relative dearth of research related to integrating and commercializing these innovations.Research on obtaining innovations includes searching, enabling, filtering, and acquiring — each category with its own specific set of mechanisms and conditions. Integrating innovations has been mostly studied from an absorptive capacity perspective, with less attention given to the impact of competencies and culture (including not-invented-here). Commercializing innovations puts the most emphasis on how external innovations create value rather than how firms capture value from those innovations. Finally, the interaction phase considers both feedback for the linear process and reciprocal innovation processes such as co-creation, network collaboration and community innovation.This review and synthesis suggests several gaps in prior research. One is a tendency to ignore the importance of business models, despite their central role in distinguishing open innovation from earlier research on inter-organizational collaboration in innovation. Another gap is a tendency in open innovation to use “innovation” in a way inconsistent with earlier definitions in innovation management. The article concludes with recommendations for future research that include examining the end-to-end innovation commercialization process, and studying the moderators and limits of leveraging external sources of innovation.
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paper_title: Innovation in Cities: Science-Based Diversity, Specialization and Localized Competition

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Whether diversity or specialization of economic activity better promotes technological change and subsequent economic growth has been the subject of a heated debate in the economics literature. The purpose of this paper is to consider the effect of the composition of economic activity on innovation. We test whether the specialization of economic activity within a narrow concentrated set of economic activities is more conducive to knowledge spillovers or if diversity, by bringing together complementary activities, better promotes innovation. The evidence provides considerable support for the diversity thesis but little support for the specialization thesis.
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paper_title: The future of open innovation

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Institutional openness is becoming increasingly popular in practice and academia: open innovation, open R&D and open business models. Our special issue builds on the concepts, underlying assumptions and implications discussed in two previous R&D Management special issues (2006, 2009). This overview indicates nine perspectives needed to develop an open innovation theory more fully. It also assesses some of the recent evidence that has come to light about open innovation, in theory and in practice.
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paper_title: Technological Platforms and Diversification

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As the invention of fundamental new sciences spawns subsequent research, discovery, and commercialization, core technologies branch into new applications and markets. Some of them evolve over time into many derived technologies, whereas others are essentially “dead ends.” The pattern of evolution and branching is called a “technological trajectory.” An intriguing question is whether some firms can ride the trajectory by developing proprietary experience in a “platform technology.” Because the knowledge is proprietary, firms that originate in industrial fields based on a platform technology acquire the technological skills to diversify and to mimic the branching of the underlying technological trajectory.The ability to compete in hypercompetitive markets depends on the acquisition of know-how that is applicable to a wide set of market opportunities. Such capabilities serve as platforms into quickly evolving markets. To respond rapidly to market changes, a firm must have already acquired fundamental competitive knowledge. In a high-technology industry, such knowledge invariably is derived from experience with the underlying science and related technological fields.The authors examine capabilities as platforms by analyzing the temporal sequence of diversification as contingent on market opportunities and previous experience. The pattern of diversification of firms reflects the evolutionary branching of underlying technologies. In that sense, the aggregate decisions of firms are driven by the technological trajectories common across an industrial sector. Certain technologies have wider technological and market opportunities, and consequently experience in those technologies serves as a platform for expansion. The authors propose that a firm's experience in platform technologies increases the likelihood of diversification when environmental opportunities are favorable.The proposition is tested with the sample of 176 semiconductor startup companies founded between 1977 and 1989. Evidence from multidimensional scaling of expert opinion and from an analysis of patent records was gathered to identity relatedness among subfields and the evolutionary direction of the technologies. A discrete hazard model is specified to estimate the effect of technological histories on subsequent diversification. The results confirm the relationship between relatedness and directionality of technologies and the industrial path of diversification. The finding that diversification depends on technological experience and market opportunity has important implications for firms' entry decisions. The authors discuss those implications by describing experience as generating options on future opportunities and distinguishing between the historical path by which the stock of knowledge is accumulated and the path by which new knowledge is generated and commercialized.
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paper_title: Innovative competence, exploration and exploitation: The influence of technological diversification

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This paper investigates how technological diversification influences the rate and specific types of innovative competence. We test a set of hypotheses in a longitudinal study of a sample of biotechnology firms. Our findings provide strong support for the premise that a diversified technology base positively affects innovative competence. Furthermore, technological diversification is found to have a stronger effect on exploratory than on exploitative innovative capability. This empirical evidence suggests that technological diversity may mitigate core rigidities and path dependencies by enhancing novel solutions that accelerate the rate of invention, especially that which departs from a firm's past activities.
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paper_title: Does Technological Diversification Promote Innovation? An Empirical Analysis for European Firms

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Abstract This paper analyses the impact of technological diversity on innovative activity at the firm level. The empirical study on a panel of European R&D active companies shows that both R&D intensity and patents increase with the degree of technological diversification of the firm. Possible explanations are that, on the one hand, a firm that diversifies its technology can receive more spillovers from other (related) technological fields. On the other hand, diversification can reduce the risk from technological investments and it creates incentives to spend more on R&D. The paper provides empirical evidence relevant to the diversity-specialization innovation debate.
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paper_title: International Diversification: Effects on Innovation and Firm Performance in Product-Diversified Firms

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Theory suggests and results show that firm performance is initially positive but eventually levels off and becomes negative as international diversification increases. Product diversification moderates the relationship between international diversification and performance. International diversification is negatively related to performance in nondiversified firms, positively related in highly product-diversified firms, and curvilinearly related in moderately product-diversified firms. International diversification is also positively related to R&D intensity, but the interaction effects with product diversification are negative. The results of this study provide evidence of the importance of international diversification for competitive advantage but also suggest the complexities of implementing it to achieve these advantages in product-diversified firms.
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paper_title: Technological diversity of persistent innovators in Japan Two case studies of large Japanese firms

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We have investigated two large Japanese firms with their patent data, technological histories and product sales data of over 30 years especially in terms of intra-firm technology diversification and interactions between multiple technological trajectories. Patent data showed the process of emergencies of technological trajectories and interactions (cross-fertilization) between them quantitatively. Both persistence and diversity of technology have contributed to product diversification and sales growth. Based on our findings we have demonstrated that taking advantage of economies of scope in technology through persistence and diversification is necessary for a technology-based firm if it is to survive and to grow for a prolonged period of time. © 2003 Elsevier B.V. All rights reserved.
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paper_title: TOWARDS A THEORY OF THE TECHNOLOGY-BASED FIRM

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Abstract The modern firm is a very viable economic institution, drawing strength from a competitive market economy, with embedded `super-markets' for corporate control and `sub-markets' for internal organization. The technology-based firm in addition draws strength from its co-evolution with modern science and technology (and vice versa), and thereby becomes increasingly important. However, received theories of the firm, of which there are many, have not particularly taken account of technology and technology-based firms, nor their management. This paper takes an empirical point of departure from recent findings regarding the positive relationship between technology diversification on the one hand and corporate growth and business diversification on the other. These findings are not readily explainable by received theories of the firm, which the paper reviews, and the findings are thus taken as an explanandum for a proposed approach to formulate a theory of the technology-based firm. The approach is compatible with various other theoretical approaches such as the resource-based, the transaction-cost and the evolutionary approach, but specifically takes the idiosyncrasies of technology (i.e., technical competence) as well as management into account. Through notably strong economies of scale, scope, speed and space associated with the combination of different technologies and resources, the technology-based firm is subjected to specific dynamics in its growth and diversification and shifts of businesses and resources. In particular, a technology-based firm tends to engage in technology diversification, thereby becoming multitechnological. As such the technology-based firm has incentives to economize on increasingly expensive new technologies by pursuing strategies of internationalization on both input and output markets, technology-related business diversification, external technology marketing and sourcing, R&D rationalization and technology-related partnering.
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paper_title: THE USE OF KNOWLEDGE FOR TECHNOLOGICAL INNOVATION WITHIN DIVERSIFIED FIRMS

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We propose that searching for and transferring knowledge across divisions in a diversified firm can cultivate innovation. Using a sample of 211,636 patents from 1,644 companies during the period 1985–96, we find that the use of interdivisional knowledge positively affects the impact of an invention on subsequent technological developments. Furthermore, the positive effect of the use of interdivisional knowledge on the impact of an invention is stronger than the effect of using knowledge from within divisional boundaries or from outside firm boundaries. Our empirical findings have significant implications for the management of knowledge in diversified firms.
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paper_title: Knowledge-relatedness in firm technological diversification

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Abstract This paper claims that knowledge-relatedness is a key factor in affecting firms’ technological diversification. The hypothesis is tested that firms extend the range of their innovative activities in a non-random way. Specifically, we test the extent to which firms diversify their innovative activities across related technological fields, i.e. fields that share a common knowledge base and rely upon common heuristics and scientific principles. The paper proposes an original measure of knowledge-relatedness, using co-classification codes contained in patent documents, and examines the patterns of technological diversification of the whole population of firms from the United States, Italy, France, UK, Germany, and Japan patenting to the European Patent Office from 1982 to 1993. Robust evidence is found that knowledge-relatedness is a major feature of firms’ innovative activities.
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paper_title: The Uncertain Relevance of Newness: Organizational Learning and Knowledge Flows

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This study explores how organizational learning in subunits affects outflows of knowledge to other subunits. Three learning processes are explored: Collecting new knowledge, codifying knowledge, an...
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paper_title: Knowledge transfer in international acquisitions

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This paper reports on a multimethod study of knowledge transfer in international acquisitions. Using questionnaire data we show that the transfer of technological know-how is facilitated by communication, visits & meetings, and by time elapsed since acquisition, while the transfer of patents is associated with the articulability of the knowledge, the size of the acquired unit, and the recency of the acquisition. Using case study data, we show that the immediate post-acquisition period is characterized by imposed one-way transfers of knowledge from the acquirer to the acquired, but over time this gives way to high-quality reciprocal knowledge transfer.
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paper_title: Distributed R&D, Cross-Regional Knowledge Integration and Quality of Innovative Output

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We explore the impact of geographic dispersion of a firm's R&D activities on the quality of its innovative output. Using data on over half a million patents from 1,127 firms, we find that having geographically distributed R&D per se does not improve the quality of a firm's innovations. In fact, distributed R&D appears to be negatively associated with average value of innovations. This suggests that potential gains from access to diverse ideas and expertise from different locations probably gets offset by difficulty in achieving integration of knowledge across multiple locations. To investigate whether the innovating teams that do manage cross-fertilization of ideas from different locations achieve more valuable innovations, we analyze innovations for which there is evidence of such knowledge cross-fertilization along one of the followings dimensions: knowledge sourcing from remote R&D units, having at least one inventor with cross-regional ties, and having at least one inventor that has recently moved from another region. Analysis along these three dimensions consistently reveals a positive relationship between cross-regional knowledge integration and quality of resulting innovations. More generally, our findings provide new evidence regarding the importance of cross-unit integrative mechanisms for achieving superior performance in multi-unit firms.
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paper_title: Geographic Distribution of R&D Activity: How Does it Affect Innovation Quality?

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I examine the impact of the geographic distribution of R&D activity on the quality of innovation. Through an analysis of patent data from 100 firms in the global semiconductor manufacturing industr...
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paper_title: Knowledge spillovers and the assignment of R&D responsibilities to foreign subsidiaries

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Research on R&D location choice by MNCs has focused largely on host country factor endowments and overlooked the role that the potential to capture and utilize knowledge spillovers from competitors may also play in determining such choices. Using a large‐scale panel database of the foreign subsidiaries of U.S.‐based MNCs in above‐average R&D‐intensive industries, we examine the extent to which external spillover opportunities as well as internal firm‐specific capabilities to utilize such knowledge affect MNCs' new R&D location decisions. Our findings suggest that MNCs appear to anticipate potential spillover opportunities and are discriminating in assessing these opportunities not only across locations but also across categories of competitors within the same location. Further, our findings provide stronger support to predictions regarding the salience of global utilization capacity than they do to predictions regarding the salience of local utilization capacity. Copyright © 2004 John Wiley & Sons, Ltd.
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paper_title: How firms innovate through R&D internationalization? An S-curve hypothesis

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This article examines the effects of R&D internationalization and organizational slack on innovation performance. We suggest that there is an S-shaped relationship between R&D internationalization and innovation performance. Innovation performance increases in the decentralization stage, decreases in the transition stage, and increases again in the recentralization stage. In addition, organizational slack is hypothesized to have a negative moderating effect on the S-shaped relationship. Longitudinal data on 210 Taiwanese firms in the information technology sector during a 10-year period is collected to test the hypotheses. The findings support our prediction. Managerial implications and future research directions are discussed.
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paper_title: Acquiring New Technologies and Capabilities: A Grounded Model of Acquisition Implementation

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In this study, we explore seven in-depth cases of high-technology acquisitions and develop an empirically grounded model of technology and capability transfer during acquisition implementation. We assess how the nature of the acquired firms' knowledge-based resources, as well as multiple dimensions of acquisition implementation, have both independent and interactive effects on the successful appropriation of technologies and capabilities by the acquirer. Our inquiry contributes to the growing body of research examining the transfer of knowledge both between and within organizations. Propositions are developed to help guide further inquiry into the dynamics of acquisition implementation processes in general and, more specifically, the process of acquiring new technologies and capabilities from other firms.
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paper_title: #04-0174 ORGANIZING FOR INNOVATION: MANAGING THE COORDINATION- AUTONOMY DILEMMA IN TECHNOLOGY ACQUISITIONS

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Large, established firms acquiring small, technology-based firms must manage them so as to both exploit their capabilities and technologies in a coordinated way and foster their exploration capacity by preserving their autonomy. We suggest that acquirers can resolve this coordination-autonomy dilemma by recognizing that the effect of structural form on innovation outcomes depends on the developmental stage of acquired firms’ innovation trajectories. Structural integration decreases the likelihood of introducing new products for firms that have not launched products before being acquired and for all firms immediately after acquisition, but these effects disappear as innovation trajectories evolve.
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paper_title: Social Structure of “Coopetition” Within a Multiunit Organization: Coordination, Competition, and Intraorganizational Knowledge Sharing

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Drawing on a social network perspective of organizational coordination, this paper investigates the effectiveness of coordination mechanisms on knowledge sharing in intraorganizational networks that consist of both collaborative and competitive ties among organizational units. Internal knowledge sharing within a multiunit organization requires formal hierarchical structure and informal lateral relations as coordination mechanisms. Using sociometric techniques, this paper analyzes how formal hierarchical structure and informal lateral relations influence knowledge sharing and how interunit competition moderates the association between such coordination mechanisms and knowledge sharing in a large, multiunit company. Results show that formal hierarchical structure, in the form of centralization, has a significant negative effect on knowledge sharing, and informal lateral relations, in the form of social interaction, have a significant positive effect on knowledge sharing among units that compete with each other for market share, but not among units that compete with each other for internal resources.
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paper_title: R&D, organization structure, and the development of corporate technological knowledge

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We explore the link between a firm's organization of research - specifically, its choice to operate a centralized or decentralized R&D structure - and the type of innovation it produces. We propose that by reducing the internal transaction costs associated with R&D coordination across units, centralized R&D will generate innovations that have a larger and broader impact on subsequent technological evolution than will decentralized research. We also propose that by facilitating more distant (capabilities-broadening) search, centralized R&D will generate innovations that draw on a wider range of technologies. Our empirical results provide support for our predictions concerning impact, and mixed results for our predictions concerning breadth of search. We also find that control over research budgets complements direct authority relations in contributing to innovative impact. We propose several extensions of this research.
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paper_title: Beyond local search: boundary-spanning, exploration, and impact in the optical disk industry

paper_content:

Recognition of the firm's tendency toward local search has given rise to concepts celebrating exploration that overcomes this tendency. To move beyond local search requires that exploration span some boundary, be it organizational or technological. While several studies have encouraged boundary-spanning exploration, few have considered both types of boundaries systematically. In doing so, we create a typology of exploration behaviors: local exploration spans neither boundary, external boundary-spanning exploration spans the firm boundary only, internal boundary-spanning exploration spans the technological boundary only, and radical exploration spans both boundaries. Using this typology, we analyze the impact of knowledge generated by these different types of exploration on subsequent technological evolution. ::: ::: In our study of patenting activity in optical disk technology, we find that exploration that does not span organizational boundaries consistently generates lower impact on subsequent technological evolution. In addition, we find that the impact of exploration on subsequent technological evolution within the optical disk domain is highest when the exploration spans organizational boundaries but not technological boundaries. At the same time, we find that the impact of exploration on subsequent technological development beyond the optical disk domain is greatest when exploration spans both organizational and technological boundaries. Copyright © 2001 John Wiley & Sons, Ltd.
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paper_title: Knowledge flows within multinational corporations

paper_content:

Pursuing a nodal (i.e., subsidiary) level of analysis, this paper advances and tests an overarching theoretical framework pertaining to intracorporate knowledge transfers within multinational corporations (MNCs). We predicted that (i) knowledge outflows from a subsidiary would be positively associated with value of the subsidiary’s knowledge stock, its motivational disposition to share knowledge, and the richness of transmission channels; and (ii) knowledge inflows into a subsidiary would be positively associated with richness of transmission channels, motivational disposition to acquire knowledge, and the capacity to absorb the incoming knowledge. These predictions were tested empirically with data from 374 subsidiaries within 75 MNCs headquartered in the U.S., Europe, and Japan. Except for our predictions regarding the impact of source unit's motivational disposition on knowledge outflows, the data provide either full or partial support to all of the other elements of our theoretical framework. Copyright © 2000 John Wiley & Sons, Ltd.
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paper_title: Centrifugal and Centripetal Forces in Radical New Product Development Under Time Pressure

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Organizations must be ambidextrous to successfully develop new products—they must act creatively as well as collectively. However, how to do this is not clear. The author analyzes this problem and reviews the literature in terms of two opposing forces: the first increases the quantity and quality of ideas, information, and knowledge available for creative action while the second integrates these things into collective action. The author then models these forces to explain how the coexistence of contradictory structural elements and processes increases the probability of successful development.
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paper_title: Do High Technology Acquirers Become More Innovative

paper_content:

Drawing on organizational, managerial and financial theories, we explore whether acquirers become more innovative and the factors that can enhance their absorptive and financial capacity to benefit from acquisition. Over a 3-year post-acquisition window, our sample of 2624 high technology US acquisitions records early reverses followed by positive R&D-intensity changes and insignificant R&D productivity changes. Controlling for acquisition endogeneity and deal-specific effects, significant acquirer characteristic effects emerge. In related acquisitions, a large knowledge base tends to increase R&D productivity, consistent with an enhanced capacity to select and absorb targets. In unrelated acquisitions, however, this relationship becomes increasingly negative as knowledge base concentration increases, consistent with arguments for an impaired peripheral vision and core rigidities. High leverage levels raise R&D productivity gains, consistent with enhanced monitoring induced efficiency. However, high leverage growth reduces R&D-intensity, consistent with increased financial constraints and short-termism.
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paper_title: Technological acquisitions and the innovation performance of acquiring firms: a longitudinal study

paper_content:

This paper examines the impact of acquisitions on the subsequent innovation performance of acquiring firms in the chemicals industry. We distinguish between technological acquisitions, acquisitions in which technology is a component of the acquired firm's assets, and nontechnological acquisitions: acquisitions that do not involve a technological component. We develop a framework relating acquisitions to firm innovation performance and develop a set of measures for quantifying the technological inputs a firm obtains through acquisitions. We find that within technological acquisitions absolute size of the acquired knowledge base enhances innovation performance, while relative size of the acquired knowledge base reduces innovation output. The relatedness of acquired and acquiring knowledge bases has a nonlinear impact on innovation output. Nontechnological acquisitions do not have a significant effect on subsequent innovation output. Copyright © 2001 John Wiley & Sons, Ltd.
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paper_title: Open for innovation: the role of openness in explaining innovation performance among U.K. manufacturing firms

paper_content:

A central part of the innovation process concerns the way firms go about organizing search for new ideas that have commercial potential. New models of innovation have suggested that many innovative firms have changed the way they search for new ideas, adopting open search strategies that involve the use of a wide range of external actors and sources to help them achieve and sustain innovation. Using a large-scale sample of industrial firms, this paper links search strategy to innovative performance, finding that searching widely and deeply is curvilinearly (taking an inverted U-shape) related to performance. Copyright © 2005 John Wiley & Sons, Ltd.
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paper_title: The influence of corporate acquisitions on the behaviour of key inventors

paper_content:

The behaviour of key inventors after the acquisition of their company is examined. Key inventors are identified on the basis of their patenting output. They account for a large number of their company?s high-quality patents. The analysis of 43 acquisitions shows that key inventors leave to a substantial extent their company or they significantly reduce their patenting performance after the acquisition. Factors influencing the behaviour of key inventors after acquisitions are identified. Implications for the effective management of acquisitions as well as suggestions for further research are outlined.
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paper_title: Learning Through Acquisitions

paper_content:

Research on acquisitions has typically focused on acquisitions per se, examining issues such as performance and implementation problems. This study moves beyond that perspective and studies the influence on a firm's later expansions. We argue that exploitation of a firm's knowledge base through “greenfields” eventually makes a firm simple and inert. In contrast, acquisitions may broaden a firm's knowledge base and decrease inertia, enhancing the viability of its later ventures. Over time, firms strike a balance between the use of greenfields and acquisitions. Various implications of this theory—tested with survival analysis and “logit” models—were strongly corroborated.
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paper_title: Geographic Distribution of R&D Activity: How Does it Affect Innovation Quality?

paper_content:

I examine the impact of the geographic distribution of R&D activity on the quality of innovation. Through an analysis of patent data from 100 firms in the global semiconductor manufacturing industr...
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paper_title: Knowledge Sharing in Organizations: Multiple Networks, Multiple Phases

paper_content:

Different subsets of social networks may explain knowledge sharing outcomes in different ways. One subset may counteract another subset, and one subset may explain one outcome but not another. We found support for these arguments in an analysis of a sample of 121 new-product development teams. Within-team and interunit networks had different effects on the outcomes of three knowledge-sharing phases: deciding whether to seek knowledge across subunits, search costs, and costs of transfers. These results suggest that research on knowledge sharing can be advanced by studying how multiple networks affect various phases of knowledge sharing.
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paper_title: Distributed R&D, Cross-Regional Knowledge Integration and Quality of Innovative Output

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We explore the impact of geographic dispersion of a firm's R&D activities on the quality of its innovative output. Using data on over half a million patents from 1,127 firms, we find that having geographically distributed R&D per se does not improve the quality of a firm's innovations. In fact, distributed R&D appears to be negatively associated with average value of innovations. This suggests that potential gains from access to diverse ideas and expertise from different locations probably gets offset by difficulty in achieving integration of knowledge across multiple locations. To investigate whether the innovating teams that do manage cross-fertilization of ideas from different locations achieve more valuable innovations, we analyze innovations for which there is evidence of such knowledge cross-fertilization along one of the followings dimensions: knowledge sourcing from remote R&D units, having at least one inventor with cross-regional ties, and having at least one inventor that has recently moved from another region. Analysis along these three dimensions consistently reveals a positive relationship between cross-regional knowledge integration and quality of resulting innovations. More generally, our findings provide new evidence regarding the importance of cross-unit integrative mechanisms for achieving superior performance in multi-unit firms.
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paper_title: National Cultural Distance and Cross-Border Acquisition Performance

paper_content:

Previous theoretical research has argued that national cultural distance hinders cross-border acquisition performance by increasing the costs of integration. This article tests the alternative hypothesis that national cultural distance enhances cross-border acquisition performance by providing access to the target's and/or the acquirer's diverse set of routines and repertoires embedded in national culture. Using a multi-dimensional measure of national cultural distance and controlling for other effects, we examine a sample of 52 cross-border acquisitions that took place between 1987 and 1992, and find a positive association between national cultural distance and cross-border acquisition performance.© 1998 JIBS. Journal of International Business Studies (1998) 29, 137–158
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paper_title: How firms innovate through R&D internationalization? An S-curve hypothesis

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This article examines the effects of R&D internationalization and organizational slack on innovation performance. We suggest that there is an S-shaped relationship between R&D internationalization and innovation performance. Innovation performance increases in the decentralization stage, decreases in the transition stage, and increases again in the recentralization stage. In addition, organizational slack is hypothesized to have a negative moderating effect on the S-shaped relationship. Longitudinal data on 210 Taiwanese firms in the information technology sector during a 10-year period is collected to test the hypotheses. The findings support our prediction. Managerial implications and future research directions are discussed.
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paper_title: Explaining the National Cultural Distance Paradox

paper_content:

Past studies of the relationship between national cultural distance and entry mode choice have produced conflicting results. Some scholars find cultural distance associated with choosing wholly owned modes; others find cultural distance linked to a preference for joint ventures. In this paper we provide both theoretical and empirical evidence to explain the discrepant findings and thus, help to resolve the national cultural distance paradox.
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paper_title: Absorptive Capacity: A New Perspective on Learning and Innovation

paper_content:

Discusses the notion that the ability to exploit external knowledge is crucial to a firm's innovative capabilities. In addition, it is argued that the ability to evaluate and use outside knowledge is largely a function of the level of prior related knowledge--i.e., absorptive capacity. Prior research has shown that firms that conduct their own research and development (R&D) are better able to use information from external sources. Therefore, it is possible that the absorptive capacity of a firm is created as a byproduct of the firm's R&D investment. A simple model of firm R&D intensity is constructed in a broader context of what applied economists call the three classes of industry-level determinants of R&D intensity: demand, appropriability, and technological opportunity conditions. Several predictions are made, including the notions that absorptive capacity does have a direct effect on R&D spending and spillovers will provide a positive incentive to conduct R&D. All hypotheses are tested using cross-sectional survey data on technological opportunity and appropriability conditions--collected over the period 1975 to 1977 for 1,719 business units--in the American manufacturing sector from Levin et al. (1983, 1987) and the Federal Trade Commission's Line of Business Program data on business unit sales, transfers, and R&D expenditures. Results confirm that firms are sensitive to the characteristics of the learning environment in which they operate and that absorptive capacity does appear to be a part of a firm's decisions regarding resource allocation for innovative activity. Results also suggest that, although the analysis showing a positive effect of spillovers in two industry groups do not represent a direct test of the model, positive absorption incentive associated with spillovers may be sufficiently strong in some cases to more than offset the negative appropribility incentive. (SFL)
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paper_title: External Sources of Innovative Capabilities: The Preferences for Strategic Alliances or Mergers and Acquisitions

paper_content:

This paper explores the preferences that companies have as they use alternative (quasi) external sources of innovative competencies such as strategic technology alliances, mergers and acquisitions, or a mix of these. These alternatives are studied in the context of distinct industrial, technological and international settings during the first half of the 1990s. Different strategies followed by companies and the role played by routinized sets of preferences are also taken into consideration. The analysis demonstrates that these options are influenced by both different environmental conditions and firm specific circumstances, such as those related to protecting core businesses.
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paper_title: Technological acquisitions and the innovation performance of acquiring firms: a longitudinal study

paper_content:

This paper examines the impact of acquisitions on the subsequent innovation performance of acquiring firms in the chemicals industry. We distinguish between technological acquisitions, acquisitions in which technology is a component of the acquired firm's assets, and nontechnological acquisitions: acquisitions that do not involve a technological component. We develop a framework relating acquisitions to firm innovation performance and develop a set of measures for quantifying the technological inputs a firm obtains through acquisitions. We find that within technological acquisitions absolute size of the acquired knowledge base enhances innovation performance, while relative size of the acquired knowledge base reduces innovation output. The relatedness of acquired and acquiring knowledge bases has a nonlinear impact on innovation output. Nontechnological acquisitions do not have a significant effect on subsequent innovation output. Copyright © 2001 John Wiley & Sons, Ltd.
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paper_title: Network Structure and Knowledge Transfer: The Effects of Cohesion and Range

paper_content:

This research considers how different features of informal networks affect knowledge transfer. As a complement to previous research that has emphasized the dyadic tie strength component of informal networks, we focus on how network structure influences the knowledge transfer process. We propose that social cohesion around a relationship affects the willingness and motivation of individuals to invest time, energy, and effort in sharing knowledge with others. We further argue that the network range, ties to different knowledge pools, increases a person's ability to convey complex ideas to heterogeneous audiences. We also examine explanations for knowledge transfer based on absorptive capacity, which emphasizes the role of common knowledge, and relational embeddedness, which stresses the importance of tie strength. We investigate the network effect on knowledge transfer using data from a contract R&D firm. The results indicate that both social cohesion and network range ease knowledge transfer, over and abov...
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paper_title: Don't go it alone: alliance network composition and startups' performance in Canadian biotechnology

paper_content:

We combine theory and research on alliance networks and on new firms to investigate the impact of variation in startups’ alliance network composition on their early performance. We hypothesize that startups can enhance their early performance by 1) establishing alliances, 2) configuring them into an efficient network that provides access to diverse information and capabilities with minimum costs of redundancy, conflict, and complexity, and 3) judiciously allying with potential rivals that provide more opportunity for learning and less risk of intra-alliance rivalry. An analysis of Canadian biotech startups’ performance provides broad support for our hypotheses, especially as they relate to innovative performance. Overall, our findings show how variation in the alliance networks startups configure at the time of their founding produces significant differences in their early performance, contributing directly to an explanation of how and why firm age and size affect firm performance. We discuss some clear, but challenging, implications for managers of startups. Copyright © 2000 John Wiley & Sons, Ltd.
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paper_title: The Embeddedness of Networks: Institutions, Structural Holes, and Innovativeness in the Fuel Cell Industry

paper_content:

Plentiful research suggests that embeddedness in alliance networks influences firms’ innovativeness. This research, however, has mostly overlooked the fact that interorganizational ties are themselves embedded within larger institutional contexts that can shape the effects of networks on organizational outcomes. We address this gap in the literature by arguing that national institutions affect the extent to which specific network positions, such as brokerage, influence innovation. We explore this idea in the context of corporatism, which fosters an institutional logic of collaboration that influences the broker’s ability to manage its partnerships and recombine the knowledge residing in its network as well as the extent of knowledge flows among network participants. We argue that differences in institutional logics lead brokerage positions to exert different effects on firm innovativeness. We propose that the firm spanning structural holes obtains the greatest innovation benefits when the firm the broker or its alliance partners are based in highly corporatist countries, or under certain combinations of broker and partner corporatism. We find support for these ideas through a longitudinal study of cross-border fuel cell technology alliance networks involving 109 firms from nine countries between 1981 and 2001.
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paper_title: Knowledge Networks: Explaining Effective Knowledge Sharing in Multiunit Companies

paper_content:

This paper introduces the concept of knowledge networks to explain why some business units are able to benefit from knowledge residing in other parts of the company while others are not. The core premise of this concept is that a proper understanding of effective interunit knowledge sharing in a multiunit firm requires a joint consideration of relatedness in knowledge content among business units and the network of lateral interunit relations that enables task units to access related knowledge. Results from a study of 120 new product development projects in 41 business units of a large multiunit electronics company showed that project teams obtained more existing knowledge from other units and completed their projects faster to the extent that they had short interunit network paths to units that possessed related knowledge. In contrast, neither network connections nor extent of related knowledge alone explained the amount of knowledge obtained and project completion time. The results also showed a contingent effect of having direct interunit relations in knowledge networks: While established direct relations mitigated problems of transferring noncodified knowledge, they were harmful when the knowledge to be transferred was codified, because they were less needed but still involved maintenance costs. These findings suggest that research on knowledge transfers and synergies in multiunit firms should pursue new perspectives that combine the concepts of network connections and relatedness in knowledge content.
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paper_title: Knowledge Networks as Channels and Conduits: The Effects of Spillovers in the Boston Biotechnology Community

paper_content:

We contend that two important, nonrelational, features of formal interorganizational networks-geographic propinquity and organizational form-fundamentally alter the flow of information through a network. Within regional economies, contractual linkages among physically proximate organizations represent relatively transparent channels for information transfer because they are embedded in an ecology rich in informal and labor market transmission mechanisms. Similarly, we argue that the spillovers that result from proprietary alliances are a function of the institutional commitments and practices of members of the network. When the dominant nodes in an innovation network are committed to open regimes of information disclosure, the entire structure is characterized by less tightly monitored ties. The relative accessibility of knowledge transferred through contractual linkages to organizations determines whether innovation benefits accrue broadly to membership in a coherent network component or narrowly to centrality. We draw on novel network visualization methods and conditional fixed effects negative binomial regressions to test these arguments for human therapeutic biotechnology firms located in the Boston metropolitan area.
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paper_title: Interorganizational alliances and the performance of firms : A study of growth and innovation rates in a high-technology industry

paper_content:

This paper investigates the relationship between intercorporate technology alliances and firm performance. It argues that alliances are access relationships, and therefore that the advantages which a focal firm derives from a portfolio of strategic coalitions depend upon the resource profiles of its alliance partners. In particular, large firms and those that possess leading-edge technological resources are posited to be the most valuable associates. The paper also argues that alliances are both pathways for the exchange of resources and signals that convey social status and recognition. Particularly when one of the firms in an alliance is a young or small organization or, more generally, an organization of equivocal quality, alliances can act as endorsements: they build public confidence in the value of an organization's products and services and thereby facilitate the firm's efforts to attract customers and other corporate partners. The findings from models of sales growth and innovation rates in a large sample of semiconductor producers confirm that organizations with large and innovative alliance partners perform better than otherwise comparable firms that lack such partners. Consistent with the status-transfer arguments, the findings also demonstrate that young and small firms benefit more from large and innovative strategic alliance partners than do old and large organizations. Copyright © 2000 John Wiley & Sons, Ltd.
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paper_title: Interorganizational Collaboration and Innovation: Toward a Portfolio Approach*

paper_content:

In the literature on innovation, interorganizational collaboration has been advanced as beneficial for the innovative performance of firms. At the same time, large-scale empirical evidence for such a relationship is scarce. This article examines whether evidence can be found for the idea that interorganizational collaboration supports the effectiveness of innovation strategies. This article empirically addresses this research question by analyzing data on Belgian manufacturing firms (n=221) collected in the Community Innovation Survey, a biannual survey organized by Eurostat and the European Commission aimed at obtaining insights into the innovation practices and performance of companies within the various European Union (EU) member states. Tobit analyses reveal a positive relationship between interorganizational collaboration and innovative performance. At the same time, the impact on innovative performance differs depending on the nature of the partner(s) involved. These findings strongly suggest the relevance of adopting a portfolio approach to interorganizational collaboration within the context of innovation strategies.
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paper_title: Absorptive capacity, learning, and performance in international joint ventures

paper_content:

This paper proposes and tests a model of IJV learning and performance that segments absorptive capacity into the three components originally proposed by Cohen and Levinthal (1990). First, trust between an IJV's parents and the IJV's relative absorptive capacity with its foreign parent are suggested to influence its ability to understand new knowledge held by foreign parents. Second, an IJV's learning structures and processes are proposed to influence its ability to assimilate new knowledge from those parents. Third, the IJV's strategy and training competence are suggested to shape its ability to apply the assimilated knowledge. Revisiting the Hungarian IJVs studied by Lyles and Salk (1996) 3 years later, we find support for the knowledge understanding and application predictions, and partial support for the knowledge assimilation prediction. Unexpectedly, our results suggest that trust and management support from foreign parents are associated with IJV performance but not learning. Our model and results offer a new perspective on IJV learning and performance as well as initial insights into how those relationships change over time. Copyright © 2001 John Wiley & Sons, Ltd.
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paper_title: Contingencies in collaborative innovation: matching organisational learning with strategic orientation and environmental munificence

paper_content:

Matching organisational learning with internal and external contingency factors is important for firms in emerging economies in order to improve their collaborative innovation. This study investigates the fit, in collaborative innovation, between: 1) a firm’s organisational learning; 2) its strategic orientation and the environmental munificence. Using a sample of 136 Chinese firms that engage in R&D collaboration, we examine the fit effects of organisational learning (exploratory learning and exploitative learning) and the contingency factors (strategic orientation and environmental munificence) on collaborative innovation performance, and find that exploratory learning coupled with resource-driven strategic orientation and high environmental munificence enhances collaborative innovation performance, while exploitative learning coupled with opportunity-driven strategic orientation and low environmental munificence enhances collaborative innovation performance.
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paper_title: Network structure and innovation: The leveraging of a dual network as a distinctive relational capability

paper_content:

This paper employs comparative longitudinal case study research to investigate why and how strong dyadic interfirm ties and two alternative network architectures (a ‘strong ties network’ and a ‘dual network’) impact the innovative capability of the lead firm in an alliance network. I answer these intrinsically cross-level research questions by examining how three design-intensive furnishings manufacturers managed their networks of joint-design alliances with consulting industrial design firms over more than 30 years. Initially, in order to explore the sample lead firms’ alliance behavior, I advance an operationalization of interorganizational tie strength. Next, I unveil the strengths of strong ties and the weaknesses of a strong ties network. Finally, I show that the ability to integrate a large periphery of heterogeneous weak ties and a core of strong ties is a distinctive lead firm’s relational capability, one that provides fertile ground for leading firms in knowledge-intensive alliance networks to gain competitive advantages whose sustainability is primarily based on the dynamic innovative capability resulting from leveraging a dual network architecture.
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paper_title: Social capital, knowledge acquisition, and knowledge exploitation in young technology-based firms

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Employing a sample of 180 entrepreneurial high-technology ventures based in the United Kingdom, we examine the effects of social capital in key customer relationships on knowledge acquisition and knowledge exploitation. Building on the relational view and on social capital and knowledge-based theories, we propose that social capital facilitates external knowledge acquisition in key customer relationships and that such knowledge mediates the relationship between social capital and knowledge exploitation for competitive advantage. Our results indicate that the social interaction and network ties dimensions of social capital are indeed associated with greater knowledge acquisition, but that the relationship quality dimension is negatively associated with knowledge acquisition. Knowledge acquisition is, in turn, positively associated with knowledge exploitation for competitive advantage through new product development, technological distinctiveness, and sales cost efficiency. Further, our results provide evidence that knowledge acquisition plays a mediating role between social capital and knowledge exploitation. Copyright © 2001 John Wiley & Sons, Ltd.
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paper_title: Interfirm Collaboration Networks: The Impact of Large-Scale Network Structure on Firm Innovation

paper_content:

The structure of alliance networks influences their potential for knowledge creation. Dense local clustering provides information transmission capacity in the network by fostering communication and cooperation. Nonredundant connections contract the distance between firms and give the network greater reach by tapping a wider range of knowledge resources. We propose that firms embedded in alliance networks that exhibit both high clustering and high reach (short average path lengths to a wide range of firms) will have greater innovative output than firms in networks that do not exhibit these characteristics. We find support for this proposition in a longitudinal study of the patent performance of 1,106 firms in 11 industry-level alliance networks.
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paper_title: KNOWLEDGE TRANSFER IN INTRAORGANIZATIONAL NETWORKS: EFFECTS OF NETWORK POSITION AND ABSORPTIVE CAPACITY ON BUSINESS UNIT INNOVATION AND PERFORMANCE

paper_content:

Inside a multiunit organization, units can learn from each other and benefit from new knowledge developed by other units. Knowledge transfer among organizational units provides opportunities for mutual learning and interunit cooperation that stimulate the creation of new knowledge and, at the same time, contribute to organizational units' ability to innovate (e.g., Kogut & Zander, 1992; Tsai &
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paper_title: Alliance Type, Alliance Experience, and Alliance Management Capability in High-technology Ventures

paper_content:

Building on the recent theoretical notion that a firm's alliance management capability can be a source of competitive advantage (Dyer and Singh, 1998; Ireland, Hitt, and Vaidyanath, 2002), we empirically investigate the effect of alliance-specific and firm-level factors on a high-technology venture's alliance management capability. We define alliance management capability as a firm's ability to effectively manage multiple alliances. To test the effect of alliance type on alliance management capability, we first establish that the relationship between a high-technology venture's R&D alliances and its new product development is inverted U-shaped, regardless of alliance type (i.e., upstream, horizontal, and downstream alliances). Then, we posit that different alliance types place differential demands on a firm's alliance management capability due to the different types of partners involved and due to the different types of knowledge being transferred. Finally, we argue that firms build an alliance management capability through cumulative experience with strategic alliances over time. We test the effects of alliance type and alliance experience on alliance management capability by drawing on a sample of 2,226 R&D alliances entered into by 325 global biotechnology firms in the twenty-five year period between 1973 and 1997. We find that alliance type and alliance experience moderate the relationship between a high-technology venture's R&D alliances and its new product development. These results provide some preliminary empirical evidence for the existence of an alliance management capability. The results further highlight the relevance of alliance management capability for high-technology ventures since alliance experience appears to be a distinct construct, different from firm age and firm size. Taken together, these results underscore both the ability of a high-tech venture to create a competitive advantage based on its alliance management capability and the risks alliances pose if the firm's alliance activity exceeds its alliance management capability. Managers in high-tech ventures need to consider their current alliance portfolio as well as potential alliances within the context of their firm's alliance management capability.
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paper_title: Post-formation dynamics in strategic alliances

paper_content:

This paper investigates the occurrence and determinants of post-formation governance changes in strategic alliances, including alterations in alliances' contracts, boards or oversight committees, and monitoring mechanisms. We examine alliances in the biotechnology industry and find that firms' unique alliance experience trajectories affect the likelihood of such ex post adjustments in these partnerships. Transactional features such as the alliance's scope, its division of labor, and the relevance of the collaboration to the parent firm also bear upon alliances' dynamics. We discuss the implications of these findings and how they complement prior research focusing on alliance design or termination at opposite ends of the alliance life cycle. Copyright © 2002 John Wiley & Sons, Ltd.
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paper_title: Why do firms do basic research (with their own money)

paper_content:

AbstractThe question to be addressed is: Why do private firms perform basic research with their own money? Interest in this question derives from both analytical and utilitarian considerations. There is empirical evidence in the United States, which provides the main context for this paper. Supporting the view that basic research makes a significant contribution to the productivity growth of the economy [4,7]. It is widely held that social returns from basic research are significant and higher than private returns and it is for this reason that most such activities continue to be financed by the taxpayer. This also implies that measures aimed at increasing basic research by the private sector will be welfare improving. In the United States, the federal government in the years since the Second World War has provided the vast majority of all funds devoted to basic research. Although the federal share has been declining in recent years, and although that share is at its lowest level in about 20 years, it still constitutes about two-thirds of the total [10]…
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paper_title: Do High Technology Acquirers Become More Innovative

paper_content:

Drawing on organizational, managerial and financial theories, we explore whether acquirers become more innovative and the factors that can enhance their absorptive and financial capacity to benefit from acquisition. Over a 3-year post-acquisition window, our sample of 2624 high technology US acquisitions records early reverses followed by positive R&D-intensity changes and insignificant R&D productivity changes. Controlling for acquisition endogeneity and deal-specific effects, significant acquirer characteristic effects emerge. In related acquisitions, a large knowledge base tends to increase R&D productivity, consistent with an enhanced capacity to select and absorb targets. In unrelated acquisitions, however, this relationship becomes increasingly negative as knowledge base concentration increases, consistent with arguments for an impaired peripheral vision and core rigidities. High leverage levels raise R&D productivity gains, consistent with enhanced monitoring induced efficiency. However, high leverage growth reduces R&D-intensity, consistent with increased financial constraints and short-termism.
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paper_title: ABSORPTIVE CAPACITY: A REVIEW, RECONCEPTUALIZATION, AND EXTENSION.

paper_content:

Researchers have used the absorptive capacity construct to explain various organizational phenomena. In this article we review the literature to identify key dimensions of absorptive capacity and offer a reconceptualization of this construct. Building upon the dynamic capabilities view of the firm, we distinguish between a firm's potential and realized capacity. We then advance a model outlining the conditions when the firm's potential and realized capacities can differentially influence the creation and sustenance of its competitive advantage.
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paper_title: Absorptive capacity and the search for innovation

paper_content:

This paper examines the link between a firm's absorptive capacity-building activities and the search process for innovation. We propose that the enhanced access to university research enjoyed by firms that engage in basic research and collaborate with university scientists leads to superior search for new inventions and provides advantage in terms of both the timing and quality of search outcomes. Results based on a panel data of pharmaceutical and biotechnology firms support these contentions and suggest that the two research activities are mutually beneficial, but also uncover intriguing differences that suggest differing roles of internally and externally developed knowledge.
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paper_title: KNOWLEDGE TRANSFER IN INTRAORGANIZATIONAL NETWORKS: EFFECTS OF NETWORK POSITION AND ABSORPTIVE CAPACITY ON BUSINESS UNIT INNOVATION AND PERFORMANCE

paper_content:

Inside a multiunit organization, units can learn from each other and benefit from new knowledge developed by other units. Knowledge transfer among organizational units provides opportunities for mutual learning and interunit cooperation that stimulate the creation of new knowledge and, at the same time, contribute to organizational units' ability to innovate (e.g., Kogut & Zander, 1992; Tsai &
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paper_title: R&D Alliances and Firm Performance: The Impact of Technological Diversity and Alliance Organization on Innovation

paper_content:

In this paper, I examine the impact of partner technological diversity and alliance organizational form on firm innovative performance. Using a sample of 463 R&D alliances in the telecommunications equipment industry, I find that alliances contribute far more to firm innovation when technological diversity is moderate, rather than low or high. Although this relationship holds irrespective of alliance organization, I find that hierarchical organization, such as an equity joint venture, improves firm benefits from alliances with high levels of technological diversity. Thus, alliance organizational form likely influences partner ability and incentives to share information, which affects performance.
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paper_title: INTER-TEMPORAL ECONOMIES OF SCOPE , ORGANIZATIONAL MODULARITY , AND THE DYNAMICS OF DIVERSIFICATION

paper_content:

The question of whether corporations add value beyond that created by individual businesses has engendered much debate in recent years. Some of this debate has focused on the pros and cons of related vs. unrelated diversification. A standard explanation of the benefits of related diversification has to do with the ability to obtain intra‐temporal economies of scope from contemporaneous sharing of resources by related businesses within the firm. In contrast, this paper deals with inter‐temporal economies of scope that firms achieve by redeploying resources and capabilities between related businesses over time, as firms exit some markets while entering others. The transfer of resources due to market exit distinguishes our treatment of inter‐temporal economies of scope from standard intra‐temporal economies of scope. In addition, these inter‐temporal economies can benefit from a decentralized and modular organizational structure. This ability to obtain inter‐temporal economies of scope via organizational modularity and recombination suggests that corporations do not necessarily need a high degree of coordination between business units in order to benefit from a strategy of related diversification. Copyright © 2004 John Wiley & Sons, Ltd.
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paper_title: Profiting from technological innovation by others: The effect of competitor patenting on firm value

paper_content:

Abstract In 1986, Teece proposed a seminal framework for analyzing why innovators may fail to benefit from their innovations. He argued, in part, that firms with the requisite complementary assets can often expropriate an innovator's returns especially when appropriability regimes are weak. In this paper, we explore the implications of this framework from the perspective of an incumbent firm—more precisely, of investors in that firm—facing innovation by established corporate rivals and by inventors from outside its industry. We demonstrate that the financial-market value of publicly traded firms depends on patented innovation by competitors (both established rivals and industry outsiders). Our empirical study generates three main results. First, the financial-market value of an incumbent is negatively associated with “important” patenting by outside inventors. Second, in industries characterized by weak appropriability regimes or by a strong reliance on complementary assets, this relationship is reversed: important patenting by outsiders is positively associated with the incumbent's financial-market value. Third, the effect of outsiders’ patented innovation on the focal incumbent is qualitatively different than that of established rivals’ patented innovation on the incumbent. These results are consistent with implications of Teece [Teece, D., 1986. Profiting from Innovation, Research Policy] and with recently developed models that formalize elements of his framework. More generally, these results support theories about both the market-stealing and spillover effects of innovation.
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paper_title: Innovation objectives, knowledge sources, and the benefits of breadth

paper_content:

Given the inherent risk of innovative activity. firms can improve the odds of success by pursuing multiple parallel objectives. Because innovation draws on many sources of ideas, firms also may improve their odds of successful innovation by accessing a large number of knowledge sources. In this study, we conduct one of the first firm-level statistical analyses of the impact on innovation of breadth in both innovation objectives and knowledge sources. The empirical results suggest that broader horizons with respect to innovation objectives and knowledge sources are associated with successful innovation. We do not find diminishing returns to breadth in innovation objectives, which suggests that firms may tend to search too narrowly. We interpret these results in light of well-known cognitive biases toward searching in relatively familiar domains. Copyright (C) 2009 John Wiley & Sons, Ltd.
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paper_title: Technological Innovation and Acquisitions

paper_content:

I examine whether technological innovation is a motivating factor in firms' acquisition decisions and how an acquisition (or an acquisition withdrawal) affects technological innovation in subsequent years. I find that firms engaging in acquisition activities are less innovative and have often experienced declines in technological innovation during the years prior to the bid. Among the bidders, the relatively more innovative ones are less likely to complete a deal. During the three years after the bid, successful bidders do not underperform matching firms, whereas failed bidders significantly underperform their nonbidding peers. I further find that formerly less innovative bidders benefit more from acquisitions. These findings suggest that technological innovation affects firms' acquisition decisions, and in turn, acquisitions help firms' innovation efforts.
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paper_title: Mergers and acquisitions: Their effect on the innovative performance of companies in high-tech industries

paper_content:

This study examines the post-M&A innovative performance of acquiring firms in four major high-tech sectors. Non-technological M&As appear to have a negative impact on the acquiring firm's post-M&A innovative performance. With respect to technological M&As, a large relative size of the acquired knowledge base reduces the innovative performance of the acquiring firm. The absolute size of the acquired knowledge base only has a positive effect during the first couple of years after which the effect turns around and we see a negative effect on the innovative performance of the acquiring firm. The relatedness between the acquired and acquiring firms’ knowledge bases has a curvilinear impact on the acquiring firm's innovative performance. This indicates that companies should target M&A ‘partners’ that are neither too unrelated nor too similar in terms of their knowledge base.
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paper_title: Competitors' Resource-Oriented Strategies: Acting on Competitors' Resources Through Interventions in Factor Markets and Political Markets

paper_content:

In this paper, we argue that we can reach a better understanding of the relationships between firm resources and competitive advantage by considering actions that firms take against their rivals' resources in factor markets and political markets. We outline market and firm characteristics that facilitate the deployment of competitors' resource-oriented strategies. We then argue that the effectiveness of the firm's actions on its competitors' resources depends on the competitive responses of the competitors being attacked.
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paper_title: Technological acquisitions and the innovation performance of acquiring firms: a longitudinal study

paper_content:

This paper examines the impact of acquisitions on the subsequent innovation performance of acquiring firms in the chemicals industry. We distinguish between technological acquisitions, acquisitions in which technology is a component of the acquired firm's assets, and nontechnological acquisitions: acquisitions that do not involve a technological component. We develop a framework relating acquisitions to firm innovation performance and develop a set of measures for quantifying the technological inputs a firm obtains through acquisitions. We find that within technological acquisitions absolute size of the acquired knowledge base enhances innovation performance, while relative size of the acquired knowledge base reduces innovation output. The relatedness of acquired and acquiring knowledge bases has a nonlinear impact on innovation output. Nontechnological acquisitions do not have a significant effect on subsequent innovation output. Copyright © 2001 John Wiley & Sons, Ltd.
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paper_title: The Performance of Incumbent firms in the Face of Radical Technological Innovation

paper_content:

A persistent theme in the academic literature on technological innovation is that incumbent enterprises have great difficulty crossing the abyss created by a radical technological innovation and, thus, go into decline, while new entrants rise to market dominance by exploiting the new technology. However, this tendency is not universal. There are outliers in any population, and much can be learned from examining this group. Here we identify a number of factors that help to explain incumbent performance in markets shaken by a radical technological innovation.
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paper_title: The endogenous relationship between innovation and diversification, and the impact of technological resources on the form of diversification

paper_content:

Abstract This research has endeavoured to build on earlier research on the relationship between a firm's technological resources and the direction of its diversification, by trying to confirm the endogeneity of this relationship and by addressing the influence of innovation on the choice of the mode of diversification. Based on a sample of Spanish firms, our results suggest that innovation drives diversification, but not the reverse. The second important finding of this research is the empirical confirmation that knowledge assets are not related to the diversification mode.
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paper_title: Technological acquisitions and the innovation performance of acquiring firms: a longitudinal study

paper_content:

This paper examines the impact of acquisitions on the subsequent innovation performance of acquiring firms in the chemicals industry. We distinguish between technological acquisitions, acquisitions in which technology is a component of the acquired firm's assets, and nontechnological acquisitions: acquisitions that do not involve a technological component. We develop a framework relating acquisitions to firm innovation performance and develop a set of measures for quantifying the technological inputs a firm obtains through acquisitions. We find that within technological acquisitions absolute size of the acquired knowledge base enhances innovation performance, while relative size of the acquired knowledge base reduces innovation output. The relatedness of acquired and acquiring knowledge bases has a nonlinear impact on innovation output. Nontechnological acquisitions do not have a significant effect on subsequent innovation output. Copyright © 2001 John Wiley & Sons, Ltd.
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paper_title: Corporate diversification, coherence and economic performance

paper_content:

Within the diversification literature the concept of corporate coherence has been referred to as the ability of the firm to generate and explore synergies of various types. However, the empirical studies have insofar provided only approaches taking explicitly into account the product/market side of the phenomenon. The present paper operationalizes the concept of corporate coherence as a dynamic interconnectedness between the company's technological competencies and its downstream activities. It also provides some further empirical evidence on the widely discussed relationship between corporate diversification and performance. Specifically, it offers some (albeit rather weak) evidence that economic performance is positively influenced not by the degree of diversification per se, but by the ability of the company to increase its corporate coherence. Copyright 2004, Oxford University Press.
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paper_title: THE COMPETITIVE ADVANTAGE OF INTERCONNECTED FIRMS: AN EXTENSION OF THE RESOURCE-BASED VIEW.

paper_content:

In light of the increasing popularity of strategic alliances, the resource-based view is revisited and extended in order to allow for the consideration of alliance partner resources in evaluating the competitive advantage of interconnected firms. The proposed model distinguishes shared resources from non-shared resources and identifies four types of rents: (a) internal rents, (b) appropriated relational rents, (c) inbound spillover rents and (d) outbound spillover rents. The model illustrates how firm-specific, relation-specific, and partner-specific factors determine the contribution of partner resources to the rent streams that a firm can extract from its ego-network of alliances.
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paper_title: Does technological convergence imply convergence in markets? Evidence from the electronics industry

paper_content:

Abstract This paper uses data on new subsidiaries, acquisitions, collaborative agreements, and patents of the largest 32 US and European electronics firms during 1984–1992 to examine the relationships between technological and business diversification. We find that during the 1980s many firms focused on fewer businesses, but we find no evidence of greater technological focus. We argue that this is related to the fact that, in spite of technological convergence, electronics sectors still command highly industry- or even product-specific downstream assets. In addition, we find that business focus improved performance, but that better performance is also associated with greater technological diversification. We discuss some interpretation of this finding.
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paper_title: Corporate technology portfolios and R&D performance measures: a study of technology intensive firms

paper_content:

This paper examines the relations between technology portfolio strategies and five commonly used research and development (R&D) performance measures. Patent and financial data of 78 US-based technology companies from 1976 to 1995 were gathered and analysed to investigate how a well-managed technology portfolio can create synergy and affect R&D performance. A technology portfolio can be characterized by its composition and technology concentration. A valuable technology portfolio that consists of patents with higher average citation made and self-citation ratio can have a positive effect on firm value. Our findings suggest that large firms may enjoy advantages for technological innovation because they can exploit synergy effects of their technology portfolios. Technology concentration strategy does not work well because firms focusing on few technology fields can experience diseconomy to patents received since high-quality patents are increasingly difficult to obtain. This paper lays the groundwork for future empirical research on technology portfolio and R&D performance.
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paper_title: The Impact of Culture on the Strategy of Multinational Enterprises: Does National Origin Affect Ownership Decisions?

paper_content:

This paper tests the proposition that national origin affects the strategies of multinational enterprises by looking at the determinants of the choice they make between entering the United States through partially versus wholly owned subsidiaries. We pool entries into the United States made by firms based in two countries, Japan and Finland, which differ both in their cultural characteristics and in their cultural distance to the United States. After carefully controlling for the known firm and industry-level determinants of subsidiary ownership strategies, we find that cultural distance between the home base of the investor and the target country (or perhaps political risk) exerts a powerful influence on ownership of subsidiaries, but cultural characteristics of the home base do not.
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paper_title: SUBSIDIARIES AND KNOWLEDGE CREATION: THE INFLUENCE OF THE MNC AND HOST COUNTRY ON INNOVATION

paper_content:

This paper studies the influence of external knowledge on innovation in subsidiaries of multinational firms. The focus on subsidiaries is especially interesting since they are simultaneously embedded in two knowledge contexts: (a) the internal multinational corporation (MNC) comprised of the headquarters and other subsidiaries; and (b) an external environment of regional or host country firms. We develop hypotheses to suggest that the extent of influences of these contexts on subsidiary technological innovation depends on the characteristics of the knowledge network (technological richness and diversity) and the knowledge linkages of the subsidiary with other entities. The study uses patent citation data pertaining to innovations by foreign subsidiaries of U.S. semiconductor firms to test these hypotheses. The paper finds that (a) the technological richness of the MNC, (b) the subsidiary's knowledge linkages to host country firms, and (c) the technological diversity within the host country have a positive impact on innovation. Copyright © 2004 John Wiley & Sons, Ltd.
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paper_title: The Effect of Cultural Distance on Entry Mode Choice, International Diversification, and Mne Performance: A Meta-Analysis

paper_content:

Although a growing literature indicates that cultural distance – that is, differences between national cultures – is an important determinant of organizational actions and performance, both empirical and theoretical concerns abound. In this study, the relationships of cultural distance with entry mode choice, international diversification, and MNE performance are examined by meta-analyzing data from 66 independent samples, with cumulative sample sizes ranging from 2,255 to 24,152. Regression results failed to provide statistical evidence of significant relationships between cultural distance and entry mode choice, international diversification, and MNE performance. The examination of moderator effects, however, yielded important results. We found a strong negative association between cultural distance and entry mode choice for US-based MNEs. The cultural distance–international diversification relationship was negative for high-technology industries, while it was positive for other industries. Cultural distance also had a strong positive effect on MNE performance for developed country investments. A similar, strong positive relationship was found between cultural distance and international diversification in studies with more recent samples. Results of this study indicate that substantial additional research is needed before the role of cultural distance is fully understood.
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paper_title: An institution-based view of international business strategy: A focus on emerging economies

paper_content:

Leveraging the recent research interest in emerging economies, this Perspective paper argues that an institution-based view of international business (IB) strategy has emerged. It is positioned as one leg that helps sustain the “strategy tripod” (the other two legs consisting of the industry- and resource-based views). We then review four diverse areas of substantive research: (1) antidumping as entry barriers; (2) competing in and out of India; (3) growing the firm in China; and (4) governing the corporation in emerging economies. Overall, we argue that an institution-based view of IB strategy, in combination with industry- and resource-based views, will not only help sustain a strategy tripod, but also shed significant light on the most fundamental questions confronting IB, such as “What drives firm strategy and performance in IB?”Journal of International Business Studies (2008) 39, 920–936. doi:10.1057/palgrave.jibs.8400377
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paper_title: Networks, Diversity, and Productivity: The Social Capital of Corporate R&D Teams

paper_content:

We argue that the debate regarding the performance implications of demographic diversity can be usefully reframed in terms of the network variables that reflect distinct forms of social capital. Scholars who are pessimistic about the performance of diverse teams base their view on the hypothesis that decreased network density--the average strength of the relationship among team members--lowers a team's capacity for coordination. The optimistic view is founded on the hypothesis that teams that are characterized by high network heterogeneity, whereby relationships on the team cut across salient demographic boundaries, enjoy an enhanced learning capability. We test each of these hypotheses directly and thereby avoid the problematic assumption that they contradict one another. Our analysis of data on the social networks, organizational tenure, and productivity of 224 corporate R&D teams indicates that both network variables help account for team productivity. These findings support a recasting of the diversity-performance debate in terms of the network processes that are more proximate to outcomes of interest.
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paper_title: Absorptive Capacity: A New Perspective on Learning and Innovation

paper_content:

Discusses the notion that the ability to exploit external knowledge is crucial to a firm's innovative capabilities. In addition, it is argued that the ability to evaluate and use outside knowledge is largely a function of the level of prior related knowledge--i.e., absorptive capacity. Prior research has shown that firms that conduct their own research and development (R&D) are better able to use information from external sources. Therefore, it is possible that the absorptive capacity of a firm is created as a byproduct of the firm's R&D investment. A simple model of firm R&D intensity is constructed in a broader context of what applied economists call the three classes of industry-level determinants of R&D intensity: demand, appropriability, and technological opportunity conditions. Several predictions are made, including the notions that absorptive capacity does have a direct effect on R&D spending and spillovers will provide a positive incentive to conduct R&D. All hypotheses are tested using cross-sectional survey data on technological opportunity and appropriability conditions--collected over the period 1975 to 1977 for 1,719 business units--in the American manufacturing sector from Levin et al. (1983, 1987) and the Federal Trade Commission's Line of Business Program data on business unit sales, transfers, and R&D expenditures. Results confirm that firms are sensitive to the characteristics of the learning environment in which they operate and that absorptive capacity does appear to be a part of a firm's decisions regarding resource allocation for innovative activity. Results also suggest that, although the analysis showing a positive effect of spillovers in two industry groups do not represent a direct test of the model, positive absorption incentive associated with spillovers may be sufficiently strong in some cases to more than offset the negative appropribility incentive. (SFL)
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paper_title: In Search of Complementarity in the Innovation Strategy : Internal R & D and External Knowledge Acquisition

paper_content:

Empirical research on complementarity between organizational design decisions has traditionally focused on the question of existence of complementarity. In this paper, we take a broader approach to the issue, combining a productivity and an adoption approach, while including a search for contextual variables in the firms strategy that affects complementarity. Analysis of contextual variables is not only interesting per se, but also improves the productivity test for the existence of complementarity. We use our empirical methodology to analyze complementarity between innovation activities: internal research and development (R&D) and external knowledge acquisition. Our results suggest that internal R&D and external knowledge acquisition are complementary innovation activities, but that the degree of complementarity is sensitive to other elements of the firms strategic environment. We identify reliance on basic R&Dthe importance of universities and research centers as an information source for the innovation processas an important contextual variable affecting complementarity between internal and external innovation activities.
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paper_title: IS THERE COMPLEMENTARITY OR SUBSTITUTABILITY BETWEEN INTERNAL AND EXTERNAL R & D STRATEGIES ?

paper_content:

The mixed picture of extant research on the relationship between internal and external R&D prompts us to ask such a question: under what conditions is there complementarity or substitutability between different R&D strategies? The goal of this paper is to contribute to the empirical literature by advancing and testing the contingency of the relationship between internal and external R&D strategies in shaping firms‘ innovative output. Using a panel sample of incumbent pharmaceutical firms covering the period 1986-2000, our empirical analysis suggests that the level of in-house R&D investments, which is characterized by decreasing marginal returns, is a contingency variable that critically influences the nature of the link between internal and external R&D strategies. In particular, internal R&D and external R&D, through either R&D alliances or R&D acquisitions, turn out to be complementary innovation activities at higher levels of in-house R&D investments, whereas at lower levels of in-house R&D efforts internal and external R&D are substitutive strategic options. These findings are robust to alternative specifications and estimation techniques, including a dynamic perspective on firm innovative performance.
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paper_title: When Do Relational Resources Matter? Leveraging Portfolio Technological Resources for Breakthrough Innovation

paper_content:

We examine the paradox of capabilities: although portfolio resources contribute to innovation success, and technologically capable firms have the ability to gain more such resources, firms' “competency traps” and the tension between value creation and value protection reduce benefits from portfolio resources for such firms. Results show that the quality and diversity of portfolio technological resources contribute to breakthrough innovation. The benefits are greater for firms with low internal strength and low internal diversity, thus suggesting positive synergy between portfolio and internal resources for such firms. Technologically strong firms, however, benefit from the quality of their portfolio resources when they overcome some of their competency traps.
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paper_title: Towards an open R&D system: Internal R&D investment, external knowledge acquisition and innovative performance

paper_content:

To cope with fast-changing business environments, firms are increasingly opening up their organizational boundaries to tap into external source of knowledge. By restructuring their R&D system, firms face the challenge of balancing internal and external R&D activities to profit from external knowledge. This paper examines the influence of R&D configuration on innovative performance and the moderating role of a firm's R&D capacity.
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paper_title: Innovation Management Measurement: A Review

paper_content:

Measurement of the process of innovation is critical for both practitioners and academics, yet the literature is characterized by a diversity of approaches, prescriptions and practices that can be confusing and contradictory. Conceptualized as a process, innovation measurement lends itself to disaggregation into a series of separate studies. The consequence of this is the absence of a holistic framework covering the range of activities required to turn ideas into useful and marketable products. We attempt to address this gap by reviewing the literature pertaining to the measurement of innovation management at the level of the firm. Drawing on a wide body of literature, we first develop a synthesized framework of the innovation management process consisting of seven categories: inputs management, knowledge management, innovation strategy, organizational culture and structure, portfolio management, project management and commercialization. Second, we populate each category of the framework with factors empirically demonstrated to be significant in the innovation process, and illustrative measures to map the territory of innovation management measurement. The review makes two important contributions. First, it takes the difficult step of incorporating a vastly diverse literature into a single framework. Second, it provides a framework against which managers can evaluate their own innovation activity, explore the extent to which their organization is nominally innovative or whether or not innovation is embedded throughout their organization, and identify areas for improvement.
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paper_title: Measuring innovative performance: is there an advantage in using multiple indicators?

paper_content:

Abstract The innovative performance of companies has been studied quite extensively and for a long period of time. However, the results of many studies have not yet led to a generally accepted indicator of innovative performance or a common set of indicators. So far the variety in terms of constructs, measurements, samples, industries and countries has been substantial. This paper studies the innovative performance of a large international sample of nearly 1200 companies in four high-tech industries, using a variety of indicators. These indicators range from R&D inputs, patent counts and patent citations to new product announcements. The study establishes that a composite construct based on these four indicators clearly catches a latent variable ‘innovative performance’. However, our findings also suggest that the statistical overlap between these indicators is that strong that future research might also consider using any of these indicators to measure the innovative performance of companies in high-tech industries.
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paper_title: External technology sourcing and innovation performance in LMT sectors: An analysis based on the Taiwanese Technological Innovation Survey

paper_content:

This paper presents the strategies that low- and medium-technology (LMT) firms adopt to generate technological innovation and investigates the impact of these approaches on the firms' innovation performances. These analyses are based on a sample from the Taiwanese Technological Innovation Survey totalling 753 LMT firms. The descriptive statistics show that about 95% of the firms acquired technology by technology licensing, while 32% of the firms engaged in R&D outsourcing. The firms in the sample acquiring external technological knowledge through collaboration with suppliers, clients, competitors, and research organizations are about 20%, 18%, 8%, and 23%, respectively. Using a moderated hierarchical regression analysis, this study reveals interesting results. First, inward technology licensing does not contribute significantly to innovation performance. Second, internal R&D investment negatively moderates the effect of R&D outsourcing on innovation performance. Third, internal R&D investment contingently impacts the different types of partners on innovation performance: by collaborating with different types of partners, firms with more internal R&D investment gain higher innovation returns than firms with fewer internal R&D activities. The results of this study contribute to a sharper understanding of technological innovation strategies and their effects on technological innovation performance in LMT sectors.
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paper_title: In Search of Complementarity in the Innovation Strategy : Internal R & D and External Knowledge Acquisition

paper_content:

Empirical research on complementarity between organizational design decisions has traditionally focused on the question of existence of complementarity. In this paper, we take a broader approach to the issue, combining a productivity and an adoption approach, while including a search for contextual variables in the firms strategy that affects complementarity. Analysis of contextual variables is not only interesting per se, but also improves the productivity test for the existence of complementarity. We use our empirical methodology to analyze complementarity between innovation activities: internal research and development (R&D) and external knowledge acquisition. Our results suggest that internal R&D and external knowledge acquisition are complementary innovation activities, but that the degree of complementarity is sensitive to other elements of the firms strategic environment. We identify reliance on basic R&Dthe importance of universities and research centers as an information source for the innovation processas an important contextual variable affecting complementarity between internal and external innovation activities.
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paper_title: The influence of corporate acquisitions on the behaviour of key inventors

paper_content:

The behaviour of key inventors after the acquisition of their company is examined. Key inventors are identified on the basis of their patenting output. They account for a large number of their company?s high-quality patents. The analysis of 43 acquisitions shows that key inventors leave to a substantial extent their company or they significantly reduce their patenting performance after the acquisition. Factors influencing the behaviour of key inventors after acquisitions are identified. Implications for the effective management of acquisitions as well as suggestions for further research are outlined.
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paper_title: Internationalization of innovation systems: A survey of the literature ☆

paper_content:

While there is a large literature on the internationalization of economic activity (including R&D) at the corporate level, there are not many studies of the degree of internationalization of innovation systems. The few studies that exist show that national innovation systems are becoming internationalized, even if the institutions that support them remain country-specific. To the extent that the far more numerous studies of internationalization of corporate R&D discuss innovation systems at all, they point to the continued importance of national institutions to support innovative activity, even though that activity is itself becoming increasingly internationalized. © 2005 Elsevier B.V. All rights reserved.
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paper_title: COLLABORATION NETWORKS, STRUCTURAL HOLES AND INNOVATION: A LONGITUDINAL STUDY.

paper_content:

I find that a firm's innovation output increases with the number of collaborative linkages maintained by it, the number of structural holes it spans, and the number of partners of its partners. However, innovation is negatively related to the interaction between spanning many structural holes and having partners with many partners.
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paper_title: Dynamic capabilities: what are they?

paper_content:

Seeks to present a better understanding of dynamic capabilities and the resource-based view of the firm. Dynamic capabilities are considered to be the "organizational and strategic routines by which firms achieve new resource configurations." Dynamic capabilities are identifiable and specific routines that can serve different purposes, including integrating resources, reconfiguring resources within firms, and guiding the gain and release of resources. Various examples such as the product development process and alliancing, are discussed. Commonalities related to effective dynamic capabilities can be seen across firms though this does not mean that these capabilities are exactly alike. The dynamism of the market can impact the sustainability of the dynamic capabilities and the causal ambiguity of these capabilities. Moderately dynamic markets see robust, grooved routine, while high velocity markets experience simple rules and real-knowledge creation. The evolution of these dynamic capabilities within a firm are unique but the firm's individual path is shaped by well-known learning mechanisms. Competitive advantage does not lie in the dynamic capabilities themselves but rather in the resource configurations that managers build using these dynamic capabilities. (SRD)
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paper_title: Mergers and acquisitions: Their effect on the innovative performance of companies in high-tech industries

paper_content:

This study examines the post-M&A innovative performance of acquiring firms in four major high-tech sectors. Non-technological M&As appear to have a negative impact on the acquiring firm's post-M&A innovative performance. With respect to technological M&As, a large relative size of the acquired knowledge base reduces the innovative performance of the acquiring firm. The absolute size of the acquired knowledge base only has a positive effect during the first couple of years after which the effect turns around and we see a negative effect on the innovative performance of the acquiring firm. The relatedness between the acquired and acquiring firms’ knowledge bases has a curvilinear impact on the acquiring firm's innovative performance. This indicates that companies should target M&A ‘partners’ that are neither too unrelated nor too similar in terms of their knowledge base.
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paper_title: Toward a knowledge‐based theory of the firm

paper_content:

Given assumptions about the characteristics of knowledge and the knowledge requirements of production, the firm is conceptualized as an institution for integrating knowledge. The primary contribution of the paper is in exploring the coordination mechanisms through which firms integrate the specialist knowledge of their members. In contrast to earlier literature, knowledge is viewed as residing within the individual, and the primary role of the organization is knowledge application rather than knowledge creation. The resulting theory has implications for the basis of organizational capability, the principles of organization design (in particular, the analysis of hierarchy and the distribution of decision-making authority), and the determinants of the horizontal and vertical boundaries of the firm. More generally, the knowledge-based approach sheds new light upon current organizational innovations and trends and has far-reaching implications for management practice.
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Title: The impact of internal and external technology sourcing on innovation performance: a review and research agenda

Section 1: Introduction
Description 1: Introduce the importance of innovation performance in building a firm’s competitive advantage and the roles of internal and external technology sourcing.

Section 2: Review methodology and organising framework
Description 2: Explain the systematic review methodology and the framework used to organise the literature review.

Section 3: Internal technology sourcing as an antecedent of innovation performance
Description 3: Discuss the impact of internal technology sourcing on innovation performance, including the debates on specialization vs. diversification and decentralization vs. centralization of technological knowledge.

Section 4: External technology sourcing as an antecedent of innovation performance
Description 4: Examine the role of external technology sourcing, specifically strategic alliances and mergers & acquisitions, in influencing innovation performance, and the effect of absorptive capacity as a moderator.

Section 5: Impact of the interplay between internal and external technology sourcing on innovation performance
Description 5: Discuss the complementary nature of internal and external technology sourcing and the impacts on innovation performance.

Section 6: Operational measures of concepts
Description 6: Review the various indicators and measures used in empirical studies to assess internal and external technology sourcing and innovation performance.

Section 7: Levels of analysis
Description 7: Highlight the different levels of analysis (individual, firm, network, industry, country) in the study of innovation performance and suggest the need for multilevel approaches.

Section 8: Time effect
Description 8: Discuss the temporal dimension in the relationships studied, including the long-term impacts of technological sourcing strategies on innovation performance.

Section 9: Directions for future research
Description 9: Identify gaps and suggest future research avenues on the topics of technology relatedness, market relatedness, strategic alliances, the interaction between internal and external sourcing, and longitudinal analyses.

Section 10: Conclusions
Description 10: Summarize the findings of the literature review, the importance of internal and external technology sourcing, and the recommended areas for further research.