What factors of early-stage innovative projects are likely to drive projects’ success? A longitudinal analysis of Korean entrepreneurial firms

Previous studies have identified the factors affecting successful technology commercialization as outcomes of R&D projects. However, most of them have used cross-sectional data, whereas there is a dearth of literature using longitudinal data analysis. Longitudinal analysis is essential for investigating the characteristics of early-stage innovative projects due to the inherent time lag between project evaluation and commercialization. Therefore, this study examines the early-stage project characteristics that can be used as meaningful evaluation criteria for predicting success, particularly in technology commercialization. We collected data on the ex-ante evaluation results and ex-post commercialization results of R&D projects pursued by entrepreneurial firms. We then conducted a logistic regression analysis and identified three market-related factors as significant in driving technology commercialization success in the early stages of technology development: market potential, commercialization plan, and market condition.     

When Research Meets Development: Antecedents and Implications of Transfer Speed

This paper focuses on the organization of new product development in large, R&D‐intensive firms. In these firms, research and development activities are often separated. Research is conducted in dedicated research projects at specialized research labs. Once research results are achieved by research projects, they are transferred to business units for further development and commercialization. We investigate the speed whereby research projects transfer their first research results to business units (hereafter: transfer speed). In particular, we analyze the antecedents and performance implications of transfer speed. Based on data of 503 research projects from a European R&D intensive manufacturing firm, our results suggest that a fast transfer speed (as measured by the time it takes for a research project to develop and transfer its first research result to business units) is associated with a better research performance (as measured by the total number of transfers the research project generates). Moreover, we find that different types of external R&D partners—science‐based and market‐based partners—play distinct roles in speeding up project first research transfers. While market‐based partnerships (i.e., customers and suppliers) generally contribute to a faster transfer of first research results, science‐based partnerships (i.e., universities and research institutions) only speed up first research transfers of technologically very complex projects. Our results also show that early patent filings by research projects accelerate first research transfers.     

An empirical analysis of the determinants of technology roadmap utilization

For many years now, firms have managed their research and development (R&D) by applying various approaches drawn from the discipline of technology roadmapping (TRM). The underlying rationale of these roadmapping approaches is to align firms' product and technology developments with their business goals. By visually representing firms' technology strategy, roadmaps support intra‐firm communication and facilitate the coordination of strategic decisions and activities within the technology management domain. Most previously published research on TRMs has focused on the design and implementation of roadmapping processes; that is, relatively few empirical or quantitative studies describe the use and evaluation of roadmapping techniques. This paper seeks to address this gap by conducting a survey of 186 different R&D units within stock market‐listed companies in Korea that have implemented TRM. The paper attempts to identify the antecedent factors behind firms' successful use of roadmaps, further identifying correlations between these antecedent factors through an analysis of the R&D units. It also empirically highlights these antecedent factors by empirically analyzing and verifying correlations between roadmap utilization and R&D performance.     

Organizing for continuous technology acquisition: the role of R&D geographic dispersion

External technology acquisition has been proved to be an important strategy to enhance firms’ innovation performance. However, previous studies claim that companies acquiring technologies tend to not carry on with this strategy over time, thus limiting their attitude toward continuous technology acquisition. Moreover, the extant literature also highlights that this attitude is strongly influenced by their organizational structure. Therefore, in the present paper, we investigate the relationship between how firms organize R&D activities and continuous technology acquisition. Specifically, given the increasing globalization of technological development, we focus on the role of R&D geographic dispersion, and how its influence is moderated by firms’ technological diversification. We tested our hypotheses on longitudinal data of 303 biotechnology firms that acquired, at least, one USPTO patented technology over the period 1982–2012. Results reveal that R&D geographic dispersion is curvilinearly (inverted U-shaped) related to continuous technology acquisition, with negative returns occurring earlier in technology-diversified companies.     

Synthesizing R&D planning and business strategy: some preliminary findings

The need for firms to compete in the longer run by offering superior products at competitive prices requires better integration of R&D, and technology in general, into business strategy development. A survey based on personal interviews of 40 respondents from "Fortune 500" U. S. industrial firms reveals that their shift in emphasis toward new product/process R&D is providing the impetus for placing R&D in a strategic context. However, R&D has not been fully integrated into the strategic planning process of many organizations. The results of the survey reveal that certain communication channels can be more fully utilized to meld R&D planning into business strategy. Specific suggestions to facilitate information exchange, dissemination of planning data, and integration of various R&D plans into a cohesive technology strategy are given.     

Synthesizing R&D planning and business strategy: some preliminary findings

The need for firms to compete in the longer run by offering superior products at competitive prices requires better integration of R&D, and technology in general, into business strategy development. A survey based on personal interviews of 40 respondents from “Fortune 500” U. S. industrial firms reveals that their shift in emphasis toward new product/process R&D is providing the impetus for placing R&D in a strategic context. However, R&D has not been fully integrated into the strategic planning process of many organizations. The results of the survey reveal that certain communication channels can be more fully utilized to meld R&D planning into business strategy. Specific suggestions to facilitate information exchange, dissemination of planning data, and integration of various R&D plans into a cohesive technology strategy are given.     

Evolutionary diffusion: internal and external methods used to acquire encompassing,complementary, and incremental technological changes in the lithotripsy industry

This study links theories concerning methods that firms use to acquire technology with theories concerning types of technological change. We place particular emphasis on interorganizational relationships. We predict that firms will often acquire know-how needed for encompassing technological change through equity-based arrangements with other organizations, complementary technological changes through nonequity interorganizational arrangements, and incremental changes through internal R&D. Our theory draws on perspectives that emphasize the need to develop new competencies within a business organization and to protect the value of existing competencies. Our empirical analysis examines methods of technology acquisition that firms have used in the commercialization of medical lithotripters, which are devices that fragment stones in the kidney and gall bladder. The analysis contributes to a better understanding of how technology acquisition methods vary with the manner in which technological change relates to a firm's existing capabilities. The study also helps develop our understanding of the evolutionary processes by which capabilities diffuse through an industry. © 1998 John Wiley & Sons, Ltd.     

企业R＆D商业化能力研究

知识经济的飞速发展凸显出技术创新的重要性，企业R＆D商业化能力作为企业技术创新能力的重要组成部分越来越被人们所重视。本文认为，企业R＆D商业化能力的强弱在很大程度上影响着R＆D投入的收益多少．企业可以从多个层次来改善其R＆D商业化的水平．不同的商业化途径对R＆D的盈利水平亦有着显著影响。企业应该重视其R＆D商业化能力的改善．因为．它为企业在技术创新活动中实现真正意义上的自主提供了必要的资源支持．是企业实现自主创新战略的必然选择。     

How entrepreneurial orientation can leverage innovation project portfolio management

Innovation project portfolio management (IPPM) is a key task in R&D management because this decision‐making process determines which R&D projects should be undertaken and how R&D resources are allocated. Previous research has developed a good understanding of the role of IPPM in R&D strategy implementation and of successful IPPM practices. But the fundamental orientations that drive the strategy formation and implementation process have never been investigated in the context of IPPM, and it is unclear whether successful practices are equally valid for different strategic orientations. This study, therefore, investigates the moderating impact of a firm’s entrepreneurial orientation on the relationship between strategic portfolio management practices and portfolio success. An empirical analysis of 257 firms shows that both innovativeness and risk taking as entrepreneurial orientation’s dimensions positively moderate the relationship between managerial practices and performance. Specifically, we find that firms high in innovativeness profit more from stakeholder engagement compared to firms low in innovativeness. Firms high in risk‐taking profit more from a clearly formulated strategy. With increasing innovativeness and risk‐taking propensity, firms also profit more from business case monitoring and agility in portfolio steering. The results suggest that a firm’s entrepreneurial orientation can leverage the effect of IPPM practices. Vice versa, a lacking entrepreneurial orientation can render these practices ineffective. Strategic orientation and IPPM practices should, therefore, be aligned with each other to enable firms to better implement their strategy and generate competitive advantage.     

Commercial exploitation of new technologies arising from university research: start-ups and markets for technology

The creation of start-up firms is an important method of commercializing new technologies arising from R&D at universities and other research institutions. Most research into start-ups presumes that these firms develop products or services. However, start-ups may operate through markets for technology by selling or licensing rights to use their technology to other firms – typically established firms – who develop and sell new products or services based on the technology. In this study of 57 public start-up firms created to commercialize the results of university research, we find evidence that (1) operating through markets for technology is a common approach to commercialization, (2) start-ups that operate in markets for technology can be effectively distinguished in practice from start-ups operating through product markets, and (3) there are substantive differences in the business activities of firms depending on whether they operate through product markets or markets for technology.     

The effect of compensation program and structure on sbu competitive strategy: A study of technology-intensive firms

In this paper we examine the impact various compensation programs have upon business-level strategy for technology-intensive firms. Similarly, we examine the effect of centralization of R&D and non-R&D decision-making, formality of procedures, and SBU size on competitive strategy. Analysis of data from 79 SBUs suggest that there is a resource trade-off between marketing-oriented strategies and R&D-oriented strategies, and that managers who operate under certain types of compensation programs will tend to favor R&D/innovation strategies and capital investment over other alternatives. Structure and competitive position also appear to play a significant role in determining technology and investment strategy.     

Determinants of Technical Success in Product Development When Innovative Radicalness Is Considered

Mushin Lee and Dohyeong Na present their analysis of data obtained from Korean project leaders in order to investigate the relationships between various factors and technical project success. When the radicalness of technical innovativeness is employed as a contingency variable, the result shows that existence of a champion is critical if the innovativeness is radical. Top management's support, R&D, production, and financial capabilities, and information acquisition during the development stage are related to the success, but there is no indication that the radicalness heavily affects the relationships. Information acquisition during the idea generation stage is not important for both radical and incremental improvement projects.     

Strategic control systems and relative r&d investment in large multiproduct firms

This paper hypothesizes that tight financial controls associated with large diversified M-form firms lead to a short-term, low-risk orientation and thereby lower relative investment in R&D. Further, it is hypothesized that increasing levels of diversification require different control systems which have significant implications for investing in R&D. Results of the study of 124 major U.S. firms suggest that less diversified U-form firms invest more heavily in R&D than more diversified M-form firms after controlling for size and industry effects. Additionally, dominant business firms invested more in R&D than either related or unrelated business firms. Finally, the relationship between R&D intensity and market performance was negative for related and unrelated firms. The findings suggest that the market evaluates R&D investment more positively for firms that are organized to seek synergy than for those that are organized to pursue a hedging (or diversification) strategy.     

Structuring innovation funnels for R&D projects under uncertainty

An innovative R&D project that creates a great business opportunity usually involves high technological and market uncertainty. It is easy to see that developing only one solution approach in the R&D project is too risky. The selectionism or the parallel development strategy can be applied to construct an innovation funnel that increases the flexibility to hedge against the uncertainty. However, little research has been devoted to selection of which alternative solution approaches should be included for the innovation funnel. This research aims to develop a simulation-based methodology that can help R&D managers evaluate and construct an innovation funnel containing promising alternative approaches for a novel R&D project to maximize project profit, while minimizing downside risk within an allowable loss. A new risk measure based on the concept of conditional value-at-risk from the finance literature is defined to evaluate the project downside risk. An example of drug development project is used to illustrate the proposed methodology. We recommend that firms should improve their capabilities on market research, concept screening, and R&D efficiency for taking full advantages of selectionism.     

Differential Effects of the Primary Forms of Cross Functional Integration on Product Development Cycle Time

In markets characterized by high rates of technological and market change product life cycles tend to be shorter, resulting in the increased importance of competing on the basis of product development cycle time. For firms operating in these dynamic market environments, competing on the basis of cycle time may not only be a source of competitive advantage, but in some industries may actually be essential for survival.
In this investigation the relative importance of five forms of cross functional integration and R&D integration of information or knowledge from past projects were explored in terms of their effects on product development cycle time. The five forms of cross functional integration included R&D/marketing integration, R&D/customer integration, R&D/manufacturing integration, R&D/supplier integration, and strategic partnerships. A sample of 65 U.S. and Scandinavian high technology firms (or strategic business units) were studied. The sample included firms from the computer, telecommunications, instruments, specialty chemicals, biotechnology, and software industries.
The results demonstrated that R&D integration of knowledge from past projects explained the largest degree of variation in product development cycle time. R&D/marketing integration and R&D/customer integration explained the next largest degree of variation in cycle time reduction. Cross cultural generalizability tests demonstrated that the results were generalizable across the U.S. and Scandinavian samples of firms. In addition, the results were found to be generalizable across industry or product category for five of the six forms of integration.     

PROJECT CHOICE AND RISK IN R&D*

We introduce stochastic R&D in the Hotelling model and show that if the technical risk is sufficiently high, all firms focus on the most valuable market segment. We then endogenize technical risk by allowing firms to choose between a safe and a risky R&D technology. Firms either both target the most attractive market with at least one firm using the risky technology or they choose different niche projects and both apply the safe technology. R&D spillovers lead to more differentiated R&D projects and patent protection to less. Project coordination within an RJV implies more differentiation, and may be welfare‐improving.     

The allocation of R&D resource

Abstract
The allocation of R&D resource in a multi-business organisation is often based more on current operating performance than on the relative potential for technological development of the businesses. The approach suggested in this paper attempts to overcome these problems by linking R&D allocation very closely to business strategy. The two key concepts are technology leverage, i.e. the extent to which technology can change the business environment in an industry to yield competitive advantage, and business leverage i.e. the current competitive strength of an individual business within an industry. Where technology leverage is weak, competitive advantage will be mainly dependent on factors other than R&D and it is suggested that levels of R&D effort at or below 1 % of turnover are appropriate. Where technology leverage is strong, R&D can be effective in maintaining strong business leverage by achieving technology mastery or in transforming a weak business position by creating a technological discontinuity. R&D intensities ranging from 3 to 15 or more % of turnover are thought to be appropriate in these cases. This framework can be used for policy debates on R&D allocation, for example whether the R&D allocation is appropriate for the business strategy or whether R&D could spearhead a more expansionist business strategy. The framework has been successfully used in ICI Chemicals and Polymers Limited during the annual R&D budget process.     

Management of dispersed product development teams: the role of information technologies

In recent years, international corporations such as IBM are increasingly relying on dispersed R&D teams in order to keep pace with resource availability and the demands of global markets. The advantages of this approach arise mainly from the utilization of differences in personnel costs and gaining access to a broader knowledge base to satisfy the demands of international clients. The disadvantages of teams of this kind are obvious: geographic distances, differences in culture and work habits as well as the necessity to bridge time zones place greater demands on communication, synchronization and management.
The application of specific project management methods and the intensive use of information technology (IT) lessens the disadvantages in transnational development projects. Recently completed projects involving large-scale commercial software development at IBM demonstrate the potentials of IT in transnational development. The authors advocate the application of IT adapted to specific situations. The central fields of application of IT in dispersed R&D teams are the development of a personal network, the promotion of creativity, the exchange of technical information, and the coordination of decentralized project activities.     

Antecedents of open innovation at the project level: empirical analysis of Korean firms

The concept of open innovation has recently gained wide academic attention, as it seems to have significant impact for company performance. Most empirical investigations about this emerging concept have been case studies of successful early adopters of open innovation, and their analyses have largely been at the company level. Although case studies at that level provide meaningful implications, the new phenomena merit a more in‐depth examination: that is, we need to collect and analyze data on multiple companies to explore more systematic findings about open innovations across companies. Moreover, analyses may need to go down to the individual project rather than the whole company level because innovation activities are often conducted as part of research and development (R&D) projects. To meet these needs, this study examines companies' open innovation efforts at the level of the individual R&D project. Specifically, the present study focuses on project‐level openness to better understand the mechanisms of open innovation. It explores systematic relationships between various antecedent factors and the degree of openness. Project‐level openness could be affected by team and task characteristics, such as team size, learning distance, strategic importance, technology and market uncertainty, and relevance to the main business. Relevant data collected from 303 companies in Korea were used to identify the antecedents that affect inbound and outbound openness. The research findings are expected to help provide a concrete theoretical framework suited for more generalized application and further practical development of open innovation strategy.