On Welfare under Cournot and Bertrand Competition in Differentiated Oligopolies

Häckner (2000, Journal of Economic Theory 93, 233–239) shows that in a differentiated oligopoly with more than two firms, prices may be higher under Bertrand competition than under Cournot competition, implying that the classical result of Singh and Vives (1984, Rand Journal of Economics, 15, 546–554) that Bertrand prices are always lower than Cournot prices is sensitive to the duopoly assumption. Häckner (2000, Journal of Economic Theory, 93, 233–239), however, leaves unanswered the important question of whether welfare may be lower under price competition. This note shows that in Häckner’s model both consumer surplus and total surplus are higher under price competition than under quantity competition, regardless of whether goods are substitutes or complements.     

On the endogeneity of Cournot, Bertrand, and Stackelberg competition in oligopolies

In many industries, firms pre-order input and forward sell output prior to the actual production period. It is known that forward buying input induces a “Cournot-Stackelberg endogeneity” (both Cournot and Stackelberg outcomes may result in equilibrium) and forward selling output induces a convergence to the Bertrand solution. I analyze the generalized model where firms pre-order input and forward sell output. First, I consider oligopolists producing homogenous goods, generalize the Cournot-Stackelberg endogeneity to oligopoly, and show that it additionally includes Bertrand in the generalized model. This shows that the “mode of competition” between firms may be entirely endogenous. Second, I consider duopolies producing heterogenous goods. The set of equilibrium outcomes is characterized and shown not to contain the Bertrand solution anymore. Yet, forward sales increase welfare also in this case, notably even when goods are complements.     

R&D 'programmes-competencies' matrix: analyzing R&D expertise within the firm

The author suggests that the systematic identification of a firm's technologies opens up the possibility of evaluating, protecting, optimizing, enriching and exploiting these technologies to the full. A firm's technologies fall into two parts: those embodied and exploited in current operations and those evolving from the collective competencies of its R&D staff. The author's aim is to evaluate and describe the firm's R&D competencies.
The identification of R&D competencies proceeds in three steps: tracing the background of the current and past programmes, constructing a programmes/competencies matrix, and deriving an expertise profile. The construction of the matrix is the key activity and requires much care in its execution, if competencies are to be properly defined and truly existing, and if it is to be exhaustive. The author sketches a procedure for constructing a matrix and discusses problems of implementation and draws attention to some of its limitations.
The author claims that such an inventory of expertise could improve the efficiency of the use of the R&D resource, identify a laboratory's strengths and weaknesses, direct R&D into hitherto neglected channels, assist individuals to identify and evaluate their own expertise, justify obtaining funding for building expertise in shortage areas. The method should be considered as a starting point to formulate appropriate strategies to gain access to technology.     

Teamwork Barriers in Japanese High-Technology Firms: The Sociocultural Differences Between R&D and Marketing Managers

Building and maintaining internal harmony is a fundamental concern for managers in many Japanese firms. Discussions of Japanese management practices often point to the intense socialization of new recruits, the rotation of employees through different functions, and the significant role of seniority in determining salary levels and promotions. Considering this emphasis on harmony, can we reasonably assume that the orientations of Japanese R&D and marketing managers do not differ in any ways that may pose significant barriers to teamwork between their departments? X. Michael Song and Mark E. Parry test this assumption by examining the sociocultural differences between R&D and marketing managers in Japanese high-technology firms. Using responses from both R&D and marketing managers in 223 firms, their study groups the respondents’ employers as either low- or high-integration firms. They examine the sociocultural differences between the R&D and marketing managers in the study along five dimensions: time orientation, bureaucratic orientation, professional orientation, tolerance for ambiguity, and preferences for high-risk, high-return projects. Contrary to expectations, the responses reveal several significant differences between the R&D and marketing managers in this study. Compared to their colleagues in marketing, the Japanese R&D managers in this study generally have a stronger preference for high-risk, high-return investments. The R&D managers in the study also have a longer time orientation than the Japanese marketing managers. However, marketing managers from the high-integration firms in the study have a longer time orientation than their counterparts in low-integration firms. Compared to the R&D managers, Japanese marketing managers in the high-integration firms studied have a greater tolerance for ambiguity. And relative to managers in low-integration firms, marketing and R&D managers in the high-integration firms in this study typically have a more bureaucratic organization. Perhaps most important, a significant number of R&D managers in this study perceive the marketing managers in their firms to have higher organizational status. Specifically, responses from R&D managers indicate that they perceive their marketing colleagues to have higher salaries, more power, and brighter career prospects. Such perceptions may foster morale problems among R&D professionals in these Japanese firms, and thus require management intervention to ensure that R&D performance does not suffer.     

Towards networked R&D management: the R&D approach of Sonera Corporation as an example

In this paper the authors delineate the challenges of a dynamic environment to R&D management. The authors build on most recent ideas, such as the dynamic capability view of the firm, as strategic foundation for modern R&D management. Collaboration is emphasized as a meta-capability for innovation. These ideas are merged into a 'Networked R&D Management' approach that emphasizes internal and external collaboration networks as critical for companies operating in a dynamic business environment. The approach is illustrated with ICT industry as an example. The implementation of Networked R&D Management is reflected in the illustrative case discussion of R&D management of Sonera Corporation.     

R&D strategies and variable demand

This paper looks at some of the factors imposing on the resourcing of R&D in the face of fluctuating demand. R&D has various features that differentiate it from other aspects of corporate activity and consequently managerial strategies for dealing with R&D may vary substantially. The implications for R&D strategies and the acquisition of technology are considered under different demand conditions. Various alternative strategies are developed including contracting out, technology licensing and the maintenance of an in-house facility through labour hoarding. New and existing empirical estimates are used to support the arguments and explain corporate strategy in this area.     

R&D budgeting in Swedish firms

Recent work by Näslund and Sellstedt report results which apparently conflict with accepted opinion on the techniques generally adopted in R&D budgeting. The analysis here suggests that these results can be reconciled with previous analyses and that in fact the role of ‘big science’ in Swedish R&D as well as relative size of Swedish firms compared to large U. S. and U. K. firms may explain the different conventions adopted in Swedish industry.     

Problems of R&D manpower in India

Abstract
Manpower Planning is important in R&D organizations. If one examines the budget of a research institute in any part of the world, one would find that 60–70% of the expenditure is incurred on staff salaries and benefits. Of course, manpower planning is beset with problems. This paper deals with: (i) lack of literature; (ii) scientific manpower statistics; (iii) recruitment; (iv) unemployment of S&T personnel; (v) brain drain; (vi) internal brain drain; and (vii) suggestions.     

Large European manufacturers and the management of R&D

At the end of 1984, for the third consecutive year, a research team from INSEAD administered a survey of the largest manufacturers in Europe. This survey attempts to provide an insight into the technological and manufacturing strategy designed and implemented by these large manufacturers.
Each year since 1982 about 150 companies have completed the questionnaire, and of these 150 replies about one third are repeat answers. The database thus covers about 350 companies. As a consequence this allows us not only to analyse the static picture for a single year, but also to draw a dynamic picture of how thinking about technological and manufacturing strategy is changing within the European Manufacturing Industry.
An analysis of the questionnaire's results allows us to assert some hypotheses about:
a. Changes in the length of the product lifecycle.
b. The importance of process engineering and proprietary process know-how.
c. The interface between manufacturing and research and development as perceived by the manufacturing side.
Since a similar survey is conducted for North America and Japan at the same time, it is possible to posit the European manufacturers vis-à-vis their global competitors for some of these issues.     

Core competencies and the strategic management of R&D

There is an increasing concern amongst R&D managers and their immediate 'customers' and sponsors within companies to have reliable mechanisms to direct R&D simultaneously toward effective rapid innovation and accumulation of long term technological strength. This is leading R&D managers to seek analytical tools to help them identify technologies which have particular significance for competitive advantage, for multiple SBUs, and for longer term strategic positioning, and to manage them in ways which do not leave them at the mercy of business unit strategies, but situate them closer to the core of corporate strategies. This paper conducts an examination of the parallel literature on the idea of core competencies as a new paradigm in corporate strategy and shows that core competencies can be useful focusing devices for assisting in the creation of this linkage between the technological and non-technological aspects of the corporate strategy agenda. Implications are drawn out for: R&D decisions in the areas of shaping strategic research programmes; funding and organisation regimes for R&D and measuring the effectiveness of R&D.     

The impact of EC R&D programmes on corporate R&D practice in Europe: a knowledge-base approach

This paper examines the role of additionality in the impact of EC R&D pro-grammes on firms. It comes from a study of the Impact of the EC Framework Pro-gramme on European Industry, which was sponsored by the Support Programme for Evaluation Activities in Research (SPEAR) of the EC. The argument is that there is an interaction between ie use of additional R&D resources, the organization of the R&D process, and the exploitation of R&D results. The analysis of the R&D process takes place within a framework based on the concept of the knowledge-base of the firm. A number of case studies are discussed and conclusions are drawn as to the impact of the EC Framework Pro-gramme on European firms.     

Decision parameters in global R&D management

This paper addresses the question of which variables have what kind of impact on the decision to locate new R&D facilities in countries different from the home country of a corporation. In the first section of the paper we demonstrate the complexity of this question by referring to empirical research, managerial statements and literature. We then develop a conceptual model for the location decision of international R&D activities. This is based on Porter's (1990) framework of the factors constituting the competitive advantage of nations. In the final section of this paper we show how such a model helps us to understand and also to explain a number of management issues related to global R&D activities.     

Retrospective relational sensemaking in R&D offshoring

To address the increasing relational challenges in international R&D collaboration, the present study develops a framework for understanding retrospective relational sensemaking in R&D offshore relationships. Using a comparative case study methodology, this study analyzes relational data from 56 interviews regarding four R&D offshore relationships between two large Swedish multinational companies and four R&D offshore partners. This study contributes to existing sensemaking theory by constructing a framework for retrospective relational sensemaking, including triggers and the phases of enactment, selection, and retention, to improve relational learning in R&D offshore relationships.     

Changing Patterns in Industrial R&D Management

A successful R&D manager is, in many ways, an agent of change. R&D managers must respond effectively to changes in domestic and global competition, product and process technologies, customer requirements, regulatory matters, and senior management's perception of the role R&D plays in a firm. The responses to these changes flow downstream from R&D to other parts of the organization, in the form of new materials, methods, processes, and products. To help us understand the changes facing R&D management, Ashok K. Gupta and David Wilemon present the results of a study that examines the ideas and experiences of 120 R&D directors from technology-based companies. The study explores the major changes that R&D management has undergone in recent years, the changes R&D managers expect to encounter during the next few years, and the causes of those changes. The respondents also identify the skills and knowledge they view as necessary for effective R&D management, and they assess their organizations' capabilities in those areas. According to the respondents, major changes that R&D has encountered include increased emphasis on such issues as cross-functional teamwork, R&D's contribution to both short- and long-term business results, R&D's capability to quickly bring to market new products that customers value, efficient use of R&D resources, and R&D alliances. Other changes noted by respondents include greater pressure to find new markets, increased attention on the effective management of technical personnel, and increased regulations and sensitivity to environmental issues. The knowledge domains that the respondents highlighted as having the greatest effect on R&D performance include such capabilities as understanding customer needs, monitoring market developments, commercializing new technologies, building cross-functional teams, managing multiple R&D projects, and accelerating new product development. According to the respondents, the largest gaps between required and current capabilities exist in several of the areas listed as being most important to effective R&D management, including monitoring market developments that can affect R&D activities and overall business performance, maintaining a spirit of inquiry while ensuring that R&D contributes to overall corporate performance, developing technology commercialization capabilities, fostering mutually profitable strategic alliances, and accelerating the development and commercialization of new products.     

Strategic evaluation and selection of R&D projects

The most important families of R&D project evaluation and selection methodologies and associated techniques are briefly reviewed. For each family, generally one or two methods were chosen to be analysed from the point of view of the integration with the strategy. But, first some definitions and some aspects of the new strategic role of the evaluation and selection of R&D projects, which were in mind during the interviews, are presented.
Finally, some empirical results of the use of these methodologies in France and Japan are presented. The strong and weak points of the most prevalent methods are described as they are considered by the users.     

R&D Patterns in the Video Display Terminal Industry

A long-standing question asks whether small firms or large firms are more successful in product innovation, and the answer seems to be coming up, "It depends." Professors Link and Zmud reveal some of the things it depends on when they describe the results of their research on the VDT industry. They see the VDT industry as a possible prototype of the several technologically progressive industries now growing toward the early stages of maturity. What we see here today may be a forerunner of what we'll see elsewhere in the near future.     

Career orientations of R&D professionals in Korea

This study empirically examined the relationships between career orientations of R&D professionals in Korea and other personal characteristics such as demographic factors, work-related outcomes, and reward preferences. The results, based on the survey about 1,240 technical people in 15 R&D organizations, revealed five distinctive and independent career orientations: technical, manager, project, technical transfer, and entrepreneurial orientations. The career orientations of R&D professionals are found to be different between private and public sectors and to be associated with their education level and organizational tenure. It is also observed that R&D professionals with different career orientations exhibit different work-related outcomes and reward preferences. For instance, technical-oriented professionals tend to be more educated, to exhibit better job attitudes and technical performances, and to favor professional rewards. While those with manager and transfer orientations are longer-tenured, have more positive job attitudes but lower technical performances, and prefer social status and prestige and career rewards in their organization. Both project- and entrepreneur-oriented professionals exhibit a less positive attitude toward their organizations, but seek different reward schemes: the former pursues challenging R&D projects with autonomy and the latter favors financial returns. Finally, the implications of these findings for managing careers of R&D professionals are discussed.