Managing meaning in complex business networks

In examining Van de Ven and Poole's (2005) typology of different approaches for studying organizational change, this article focuses on underlying methodological premises and concludes that an ontological, and consequently also an epistemological, perspective seems to be lacking, if the aim is to fully understand change and a firm's networking ability. Arguing for increased sensemaking, an extended version of Van de Ven and Poole's (2005) typology is proposed, which aims to guide and improve future research in understanding the interplay between cognition, action and outcomes in business networks. First, the developed methodological matrix adds an alternative view of change as a theoretical foundation. Second, the proposed model represents a useful structure for analyzing different ways to further marketing theory. Third, the results also indicate that if the aim is to find a general theory of marketing, capable of integrating seemingly contrasting stances, the outlook on change has to be altered.     

Exploratory Results on the Importance of R&D Knowledge Domains in Businesses with Different Strategies

A number of studies have described the consequences of the changing patterns in the business environment for R&D departments. Fewer studies have addressed the specific implications of the changing business environment for the agenda of R&D managers. Gupta and Wilemon (1996) have provided R&D managers with a priority list for action designed to be applicable to R&D departments independent of business strategy. However, a substantial body of literature suggests that the priority listing may be different for R&D departments in businesses with different strategies. Against this background this study sets out to determine whether the priority listing is different for Miles and Snow's (1978) strategic archetypes of prospectors, analyzers, defenders and reactors. A total of 72 R&D managers of businesses competing in industrial markets in the Netherlands provided the data to test for the existence of these differences. The results indicate that the priority listings are indeed different for R&D departments in businesses with different strategies. This finding has important practical implications. The priority listings can be used by R&D managers to assess which R&D capabilities have to be developed in order to match R&D strategy with business strategy and meet the criteria for getting more commercial payback from R&D in a changing business environment.     

Insider trading as a vehicle to appropriate rent from R&D

While most insider trading is routine and legal, investors still treat it as new information about the firm's prospects—they assume that trades reflect managers' attempts to profit from their private information. This article explores insider trading as a mechanism to appropriate rent from R&D advances. We analyze stock price reactions to over 134,000 insider‐trading events and find that insider purchases generate larger positive stock price reactions for R&D‐intensive firms. Investors seem to assume that managers use insider trading to appropriate rent from R&D breakthroughs. We discuss how shareholders may prefer this rent appropriation mechanism over other forms of compensation that directly reduce the firm's income. Copyright © 2002 John Wiley & Sons, Ltd.     

Diversity is strategy: the effect of R&D team diversity on innovative performance

Diversity in the workplace has attracted significant interest in organisations that want to attract and retain talented employees. Breakthrough innovation requires a wider knowledge base, and organisations increasingly rely on multidisciplinary R&D teams to identify scientific developments that bridge gaps and reduce time to market. However, research on the performance implications of R&D team diversity remains limited and the empirical evidence inconsistent. This paper investigates the impact of surface and deep-level diversity on R&D teams’ innovative performance and how diversity dimensions interact to drive innovation. We find supportive evidence that R&D team characteristics influence innovation outcomes, confirming our hypothesising that diversity is a valuable strategy for an organisation to pursue as it provides greater cognitive ability. Each diversity facet however has its own distinct effects depending on the novelty of innovation and industry. Yet, diversity is not solely positive and excessive heterogeneity could be detrimental to R&D team performance. Our findings suggest that high diversity in gender or skills in cognitively diverse teams might be negative attributes to take into consideration. Senior managers and organisations should therefore consider the appropriate mix of capabilities to benefit from creativity in diverse R&D teams and avoid possible conflict and distrust associated with diversity.     

Performance measurement in R&D: exploring the interplay between measurement objectives, dimensions of performance and contextual factors

Measuring research and development (R&D) performance has become a fundamental concern for R&D managers and executives in the last decades. As a result, the issue has been extensively debated in innovation and R&D management literature. The paper contributes to this growing body of knowledge, adopting a systemic and contextual perspective to look into the problem of measuring R&D performance. In particular, it explores the interplay between measurement objectives, performance dimensions and contextual factors in the design of a performance measurement system (PMS) for R&D activities. The paper relies on a multiple case study analysis that involved 15 Italian technology-intensive firms. The results indicate that firms measure R&D performance with different purposes, i.e. motivate researchers and engineers, monitor the progress of activities, evaluate the profitability of R&D projects, favour coordination and communication and stimulate organisational learning. These objectives are pursued in clusters, and the importance firms attach to each cluster is influenced by the context (type of R&D, industry belonging, size) in which measurement takes place. Furthermore, a firm's choice to measure R&D performance along a particular perspective (i.e. financial, customer, business processes or innovation and learning) is influenced by the classes of objectives (diagnostic, motivational or interactive) that are given higher priority. The implications of these results for R&D managers and scholars are discussed in the paper.     

Reducing Ongoing Product Design Decision‐Making Bias*

The objective of this exploratory study is to add to our understanding of ongoing product design decision‐making to reduce eventual decision‐making bias. Six research questions are formulated with the aim to establish if and how functional membership and informal patterns of communication within an organization influence whether and why employees are willing to engage in product design modifications. We selected as a field site for our study an industrial company that had an internal research and product development operations and where the employees were located on the same site. A three‐step approach within the manufacturing case company was designed: (1) In‐depth interviews were carried out with managers and employees; (2) a survey questionnaire was sent out to all employees involved with a specific product that is subject to potential design modifications; and (3) a post hoc group feedback session was organized to further discuss our findings with the management. First, analysis of the nine in‐depth interviews establishes a taxonomy of product design decisions involving four types of criteria; product‐related, service‐related, market‐related, and feasibility‐related criteria explain why employees would engage or not in product design modifications. Second, it is demonstrated that functional membership has a significant influence on the concern for these decision‐making criteria as well as on the decision to proceed or not with product design modifications. In other words, functional membership influences whether and why employees are more or less willing to make product design modifications. In this manufacturing company, a global industrial player, the differences in concern appear especially for service‐ and market‐related criteria and pertain particularly to the research and development (R&D) and service function. Overall, even though the perceived performance of the specific product under study did not differ significantly among the different departments, it is observed that R&D employees were significantly less in favor of proceeding with product design modifications than other employees were. Third, using UCINET VI software, we provide some explanations for this finding. It is shown that informal patterns of communication (i.e., employee degree centrality) operate a situational opportunity to make modifications to an existing product and a cognitive opportunity influencing the decision to modify product design following an inverted U‐shaped function. Ultimately, we derive practical guidelines for an ideal product–team composition to reduce product design decision‐making bias.     

Critical issues facing R&D managers in China

R&D managers in China experienced significant changes in the past decade, in particular because of Government policies of economic reform and opening to the outside world. These developments have brought about a number of rather specific R&D management issues and problems. The paper addresses the main problems faced by R&D managers in China. First, the current situation of R&D management in China is discussed, as well as the future developments. The paper then presents a case study of the CISRI (Central Iron & Steel Research Institute), a large comprehensive R&D organisation in Beijing. The analysis leads to the critical issues in CISRI's R&D management. After that, a further investigation is described into the trends of Chinese R&D management. The outcomes described focus on the future of R&D management in China as well as on the integration of Western R&D management theory in China. The paper concludes with the major issues and recommendations for the further development of R&D management in China.     

Problems faced by R&D managers in Canadian federal government laboratories

The paper conducts a critical review of the problems faced by middle to first-line managers in managing R&D in Canadian government laboratories. The data come from the published literature, interviews with R&D managers, and information obtained from government employees undergoing training as R&D managers.
The problems are numerous and serious. They arise from a multiplicity of causes related to underfunding and bureaucratic management practices that do not allow for the special nature of R&D. Hiring freezes, staff reductions, travel restrictions and reductions in training budgets are all consequences of underfunding, resulting in an aging workforce and technological obsolescence. Bureaucratic administration rules set by central agencies constrain the freedom of R&D managers to manage effectively, and limit low-level participation in policy-making and planning. The result is that too many management posts are filled by under-achieving scientists and engineers, with resultant consequences for originality and efficiency.
The authors believe that the only cure is to undertake proper funding, recognise the special operational needs of R&D management, and select managers for managerial ability in addition to technical competence.     

The role of reference point in CEO restricted stock and its impact on R&D intensity in high‐technology firms

Prior work based on agency theory and behavioral agency model has focused on how absolute pay values affect firm outcomes. Departing from this traditional approach, we draw from behavioral decision theory to explain how relative pay levels influence firm risk taking. We investigate how CEO restricted stock value relative to reference point influences R&D intensity in high‐technology firms. We propose that negative deviation increases are related to R&D increases and positive deviation increases lead to R&D decreases, while negative deviation has greater effect than positive deviation. We establish theoretical boundary conditions by considering CEO duality and board vigilance as moderators. Drawing from agency theory, we predict the main effects will be enhanced under duality and weakened under high board vigilance. Our hypotheses are largely supported. Copyright © 2014 John Wiley & Sons, Ltd.     

Non‐R&D innovation and firms’ new product performance: the joint moderating effect of R&D intensity and network embeddedness

Non‐R&D innovation increasingly plays a critical role in explaining firms’ new product performance. Yet, there has been little research on the consequences and contingent mechanisms of non‐R&D innovation for firms embedded in collaborative network environments. To address this research gap, we investigated a conceptual framework of non‐R&D innovation using data drawn from Chinese manufacturing firms. First, we found that non‐R&D innovation positively affects firms’ new product performance. Second, we discovered that high R&D intensity positively strengthens the impact of firms’ non‐R&D innovation on new product performance. Third, we provided critical analysis of the role of non‐R&D innovation in promoting new product performance, accomplished by enhancing R&D investment while simultaneously improving the degree of network embeddedness. Our findings extend both the non‐R&D innovation literature and open innovation literature while providing managers with several key recommendations.     

An SAO‐based text‐mining approach for technology roadmapping using patent information

A technology roadmap (TRM) links technologies with a company's strategic objectives and so supports acquisition of required technologies in advance of needs. It is a powerful tool for strategic planning and technology management. Because technology is changing rapidly and market competition is fierce, the role of a TRM is becoming increasingly important. To support the role of a TRM, many firms and governments that use roadmapping are becoming interested in reducing costs while retaining objectivity during TRM development. One suggestion to achieve these goals is to use the keyword‐based quantitative approach to creating a TRM, but the information provided by the approach is limited because of the characteristics of keyword information. To solve this limitation, this research uses the concept of ‘function’ to support quantitative analysis for developing a TRM. The concept of function can provide information on the uses and purposes of a technology. To represent a function, a subject–action–object structure is commonly used. The suggested approach allows research and development (R&D) managers to extend the views of product and technology during development of a TRM. In addition, by reducing the time required to develop a TRM, the proposed approach supports quick and accurate decision‐making by R&D managers.     

Exploring the Motivational and Behavioral Foundations of External Technology Experts’ Knowledge Sharing in Collaborative R&D Projects: The Contingency Role of Project Formalization

High‐tech manufacturers increasingly rely on the knowledge contributions of external technology experts (ETEs), who contribute to collaborative R&D projects on behalf of suppliers. Many scholars have considered knowledge sharing in R&D collaborations from a firm‐level or project‐level perspective and focused on formalization as a potential remedy. While individual supplier employees at the operative level make the decision to share critical knowledge, the individual‐level perspective in literature on knowledge sharing in collaborative R&D projects is virtually nonexistent. Because knowledge sharing in collaborative R&D is a largely discretionary act on behalf of the supplier employee, personal motivations rather than inter‐firm relationship elements (e.g., network position or dependency) become the primary determinant of one’s sharing behavior. Abstracting from or ignoring these motivations of supplier employees in studies on collaborative R&D may obscure important insights for R&D managers. This study is an important first step in providing the empirical evidence needed to uncover the motivational and behavioral foundations for ETEs’ knowledge sharing in a collaborative R&D setting. Building on theories of gift and social exchange, this article identifies customer stewardship and distributive fairness as two important personal motivations of ETEs to share knowledge. Project formalization is considered as a key contingency condition. Analyzing survey responses of 186 ETEs, a multilevel regression‐based moderated‐mediation analysis of direct and indirect effects shows that customer stewardship predicts an ETE’s knowledge sharing behavior under (very) low levels of project formalization, and distributive fairness predicts knowledge sharing behavior under medium to high levels of formalization. Together, the results provide R&D project managers who aim to leverage external knowledge contributions with valuable insights that have been obscured in past firm‐level collaborative R&D studies.     

Profitability Goals,Control Goals,and the R&D Investment Decisions of Family and Nonfamily Firms

Research and development (R&D) investments can help build sustainable competitive advantages and improve firm performance. Nevertheless, managers also acknowledge the difficulties associated with managing R&D and the low chances of success of innovation programs. For this reason, researchers have long been interested in understanding how managers make R&D investment decisions. Research grounded in the behavioral theory of the firm suggests that a primary driver of R&D investment decisions is profitability: when profitability goals have not been met, managers are more likely to initiate a problemistic search through increasing R&D investments. While emphasizing profitability goals and their relationship with R&D investments, prior research largely downplays the role of goals beyond profitability that exist in a significant number of firms (family firms) that are owned and managed by family members whose primary concern is preserving their control over the organization. Research indicates that these family‐centered noneconomic goals lead family managers to minimize R&D investments and that the coexistence of multiple goals produces highly variable R&D investment behavior. Yet, how family‐centered goals for control and profitability enter decision‐making in family firms is not fully understood. In this study, we propose that family managers form distinctive reference points that capture supplier bargaining power and are used to evaluate the degree of external obstruction to their managerial control. The empirical analysis of panel data on 431 private Spanish manufacturing firms observed over the period 2000–2006 shows that the importance of profitability and control goals follows a sequential logic in family firms, such that family firms react more strongly to increasing supplier bargaining power when their profitability reference points have been reached. This study extends current understanding of the distinctive organizational processes engendered by family management in business organizations leading to new research opportunities at the intersection of the innovation management and family business literatures.     

Reshaping European metrology research – the role of national research managers

This paper deals with the role of research and development (R&D) managers in shaping the landscape of public research in Europe. These R&D managers work in the sphere of public research within national government laboratory services. The case we present is of the reconfiguration of metrology research. Metrology is the science of measurement. We examine why scientists and research managers in nationally embedded institutes, which are performing R&D in support of national policy and local industry needs, have chosen to co‐operate in a shared research programme. This means giving up, in part, their national sovereignty over funds and decision making. Furthermore, we examine how they have achieved the shared programme, which was launched as a European Commission (EC) programme through the Article 185 ¹ initiative, which allows the European Union to participate in research programmes undertaken jointly by several Member States.     

How Internet technologies impact information flows in R&D: reconsidering the technological gatekeeper

Previous studies have firmly established the technological gatekeeper to be a key node in the innovation process – acquiring, translating, and disseminating external information throughout the R&D unit. However, the gatekeeper concept has received modest attention in recent times. We argue that the concept needs to be re‐examined in light of the recent advances in Internet technologies that have dramatically altered how knowledge workers source and share their information. Drawing on social network analysis and interview evidence from a medical devices R&D group, we find that the gatekeeper role is still vital, but no longer needs to be performed by a single individual. Instead, the modern R&D group can keep abreast of the latest technological advances through a combination of Internet‐enabled internal and external communication specialists. This study makes a number of important contributions. The gatekeeper theory is extended through the development of an updated conceptual framework. We also discuss the practical implications of our findings and advise R&D managers on how to organise resources to maximise optimal information flows.     

The Impact of Market Structure and Learning on the Tradeoff between R&D Competition and Cooperation

This paper compares R&D competition and cooperation when firms can devote resources to a ‘safe’ investment or a risky R&D investment. When the discovery of a new product creates positive externalities on non‐discovering firms, equilibrium investment flow, ex ante investment, and welfare under R&D competition are less than or equal to what they are under research cooperation. With negative externalities, R&D cooperation results in the same or lower ex ante investment than under R&D competition, and social welfare may also be less. Our results have relevance for empirical studies of the impact of R&D cooperation on R&D outcomes.     

The path of R&D efficiency over time

In this paper we investigate the pattern of R&D efficiency in terms of the number of product innovations achieved by firms over time. Using a panel dataset of Spanish manufacturing firms for the period 1990–2006, we follow the innovative performance of R&D active firms and observe that innovation rates change over firms' R&D histories. To explain these facts we propose a model that explicitly acknowledges the twofold composition of firms' R&D expenditures, comprising spending on both physical capital for R&D projects and payments to researchers. We regard this latter component of R&D as a source for dynamic returns to firms' R&D investments. Consequently firms' innovation outcomes clearly depend on how long they have been investing in R&D and also on whether there have been any interruptions in the temporal sequence of R&D activities. Our results suggest that R&D activities exhibit dynamic returns that are positive but at a decreasing rate, and that interruptions in R&D engagement reduce R&D efficiency.     

The contrary forces of innovation: A conceptual model for studying networked innovation processes

In this paper, we argue that industrial innovation processes can productively be analysed as consisting of two sub-processes that over time create and mobilise contrary forces within both internal and external interactions of the innovation project. One of these forces emerges from the process of mobilising resources, activities, and actors in ensuring commitments to the project over time. The other is the process of explorative learning, which continues to create revised or even new propositions about the realities of the project and its opportunities. We argue that this analytical distinction permits us to expand our understanding of how friction forces develop over time in business networks (Håkansson & Waluszewski, 2001a,b), the patterns of divergence and convergence in innovation processes as identified by Van de Ven et al. (1999) and the processes of “path creation through mindful deviation” as argued by Garud and Karnøe (2001).     

Entry mode,organizational learning,and R&D in foreign affiliates: evidence from Japanese firms

This paper develops hypotheses concerning the role of entry mode and experience‐based organizational learning as determinants of the R&D intensity of foreign affiliates and tests these hypotheses on a sample of 420 Japanese manufacturing affiliates abroad. Entry mode has a major impact on R&D activities: the R&D intensities of acquired affiliates substantially exceed those in wholly owned greenfield affiliates, while the R&D intensities of minority owned ventures are higher if Japanese parent firms lack strong R&D capabilities at home. For greenfield operations, support is found for an incremental growth pattern of foreign R&D as a function of organizational learning and affiliate capability building. The results are consistent with the view that part of the explanation for Japanese firms' relative lack of involvement in overseas R&D must be sought in their status as ‘latecomers’ in the establishment of overseas manufacturing networks. At the same time, a number of Japanese firms have actively used foreign acquisitions and joint ventures to gain access to overseas technology and to establish overseas R&D capabilities at a faster pace. Copyright © 2002 John Wiley & Sons, Ltd.