The antecedents and innovation effects of domestic and offshore R&D outsourcing: The contingent impact of cognitive distance and absorptive capacity

This paper analyzes differences in the antecedents and performance consequences of domestic and offshore R&D outsourcing. Offshore outsourcing is characterized by larger cognitive distance. We find that absorptive capacity from internal R&D allows for more offshore outsourcing and that offshore outsourcing leads to more positive innovation outcomes, especially product innovation.     

The social underpinnings of absorptive capacity: The moderating effects of structural holes on innovation generation based on external knowledge

Building on absorptive capacity and social network research, in this paper I investigate how individuals inside the organization use external knowledge to generate innovations. Through original sociometric data collected from 276 scientists, researchers, and engineers from the Research and Development division of a large multinational high‐tech company, I show that the effects of external knowledge on individuals' innovativeness are contingent upon individuals' position in the internal social structure. In particular, results indicate that the positive effects of external knowledge on innovation generation become more positive when individuals sourcing external knowledge span structural holes in the internal knowledge‐sharing network. Copyright © 2013 John Wiley & Sons, Ltd.     

The cost of integrating external technologies: Supply and demand drivers of value creation in the markets for technology

A classic question faced by technology suppliers and buyers is whether to compete in the product markets or to cooperate through licensing. We address this question by examining an important, demand‐side barrier to licensing—the buyers' cost of integrating a licensed technology. We argue that this cost can be affected by suppliers' knowledge transfer capabilities, buyers' absorptive capacity, and the cospecialization between R&D and downstream activities in the buyers' industries. Following this argument and a stylized bargaining model, we hypothesize that the supplier's knowledge transfer capability stimulates licensing. Moreover, the importance of this capability increases when licensing to industries where potential buyers have weak absorptive capacity or R&D and downstream activities are cospecialized. We find support for our hypotheses using a panel dataset of small ‘serial innovators.’ Copyright © 2012 John Wiley & Sons, Ltd.     

企业社会资本与技术创新：基于吸收能力的实证研究

本文针对我国企业社会资本影响技术创新的机制问题展开分析,从企业社会资本的特征维度出发,引入吸收能力的视角,提出了基于吸收能力的企业社会资本与技术创新绩效的概念模型。在问卷调查的基础上,通过多元线性回归分析和结构方程模型分析,对我国企业社会资本如何影响技术创新的问题进行了实证研究。研究结果表明,在不考虑吸收能力作用的情况下,企业社会资本的结构、关系和认知等三个维度的水平对于我国企业技术创新绩效的提升均具有积极显著的作用;企业社会资本三个特征维度的水平通过提高吸收能力进而正向影响技术创新绩效;其中,认知维度在结构维度和关系维度发挥效应中承担中介变量的作用。为提高企业技术创新绩效,建议以知识的获取和利用为导向,注重企业社会资本三个维度水平的均衡提高。     

Performance implications of outsourcing for technological innovations: managing the efficiency and adaptability trade‐off

We explore how increasing efficiency compromises adaptability when a firm outsources during the emergent stages of a technological innovation. Since efficiency ‐related problems differ in complexity and structure from those associated with adaptability, their optimal governance differs. While the former benefits from outsourcing, the latter is better off managed within organizational boundaries. In addition, a firm's ability to engage in complex problem solving buffers the efficiency‐adaptability trade‐off that occurs with increasing levels of outsourcing. In this study, we find support for our theses. Although outsourcing yields efficiency gains up to a certain point, it hurts adaptability. However, a firm's absorptive capacity mitigates this trade‐off. Our data on outsourcing for Internet banking is both archival and based on two surveys conducted with 100 U.S. banks. Copyright © 2011 John Wiley & Sons, Ltd.     

Scope versus speed: Team diversity,leader experience,and patenting outcomes for firms

Research Summary: How does the organization of patenting activity affect a firm's patenting outcomes? We investigate how the composition of patenting teams relates to both the scope of their patent applications and the speed with which their patents are approved, by examining the main effects of team members’ intra‐organizational diversity (based on affiliations with formal organizational units and informal organizational communities) and the moderating effects of team leader experience. We test our moderated mediation model in a sample of 121 teams that filed patents in a Fortune 50 company's India R&D center between 2005 and 2015, using proprietary employee data combined with newly released micro‐data from the U.S Patent and Trademark Office (USPTO). Our findings illuminate the micro‐foundations of innovation in firms by highlighting a trade‐off between organizing patenting activity to maximize scope versus speed. Managerial Summary: Patenting is an important strategic tool that firms can use to protect and create value from their innovations. A firm can benefit from filing a patent application that gives it a wider possible set of claims related to an innovation. It can also benefit from faster approval of a patent application by the Patent Office. However, our study shows that there is a trade‐off between patent application scope and patent approval speed, which creates tensions for the organization of patenting activities inside firms. In particular, we find that the diversity of a patenting team is positively related to patent scope but negatively related to patenting speed, and that these relationships vary with the experience of the team leader.     

Organizational knowledge networks and local search: The role of intra‐organizational inventor networks

Research summary : While firms tend to build on their own knowledge, we distinguish between depth and breadth of local search to investigate the drivers of these behaviors. Given that inventors in a firm carry out the knowledge creation activities, we strive to identify inventors responsible for these behaviors by employing the notion of an intra‐firm inventor network. A longitudinal examination of 14,575 inventors from four large semiconductor firms using patent data supports our hypotheses that the reach of inventors in the intra‐firm network and their span of structural holes have independent and interactive effects on these two types of local search behaviors. These findings have implications for research on exploitation and exploration, organizational knowledge, knowledge networks, and micro‐foundations. Managerial summary : Large amounts of knowledge may reside within firm boundaries, and managers are interested in understanding who may leverage this knowledge to generate novel ideas. We focus on collaborations among knowledge workers to address this question. Using the collaborations among all knowledge workers in a firm, we show that those who have higher reach to all others and those who form bridges to connect unconnected groups of workers tend to leverage not only more organizational knowledge, but also knowledge that is more dispersed in the organization. Managers could use these insights to shape the use of organizational knowledge by firm inventors, and also to make decisions about granting or withholding access to internal knowledge platforms for knowledge workers. Copyright © 2016 John Wiley & Sons, Ltd.     

Organizing for knowledge generation: internal knowledge networks and the contingent effect of external knowledge sourcing

Research summary : When faced with a new technological paradigm, incumbent firms can opt for internal development and/or external sourcing to obtain the necessary new knowledge. We explain how the effectiveness of external knowledge sourcing depends on the properties of internal knowledge production. We apply a social network lens to delineate interpersonal, intra‐firm knowledge networks and capture the emergence of two important firm‐level properties: the incumbent's internal potential for knowledge recombination and the level of knowledge coordination costs. We rely on firm‐level internal knowledge networks to dynamically track the emergence of these properties across 106 global pharmaceutical companies over a 25‐year time period. We find that a firm's success in developing knowledge in a new technological paradigm using external knowledge sourcing is contingent on these internal knowledge properties . Managerial summary : Incumbent firms in high‐tech industries often face competence‐destroying technological change. In their effort to adapt and develop new knowledge in a novel paradigm, incumbent firms have several corporate strategy options available to them: internal knowledge development and a wide array of external knowledge sourcing strategies, including alliances and acquisitions. In this study, we make an effort to address a critical question: How effective is external knowledge sourcing under different internal knowledge generation regimes? We find that external sourcing strategies are less effective when firms can already internally generate new knowledge or if they have high internal coordination costs. Therefore, when considering external sourcing, managers must carefully weigh the benefits of it vis‐à‐vis its commensurate costs as the benefits of external sourcing may be overstated . Copyright © 2015 John Wiley & Sons, Ltd.     

RETRACTED: Integrated knowledge exploitation: The complementarity of product development and technology licensing

In light of increasing licensing, we challenge the common assumption that product development and technology licensing are substitutes. We develop a resource‐based framework, which distinguishes a firm's technological resource base and technology exploitation processes. We further combine survey, patent, and financial data of 228 medium‐sized and large industrial companies to examine the interactions of firms' product development processes and technology licensing processes in order to explain heterogeneity in new product revenues, licensing performance, and firm performance. The results underscore that product development, which indicates innovative capacity, and technology licensing, which indicates desorptive capacity, are complements rather than substitutes in integrated knowledge exploitation in medium‐sized and large firms. This complementarity is particularly pronounced in firms with an emphasis on cross‐licensing and with a strong patent portfolio. Copyright © 2012 John Wiley & Sons, Ltd.     

The temporal effects of relative and firm‐level absorptive capacity on interorganizational learning

We examine how determinants of absorptive capacity influence learning in alliances over time. Using longitudinal patent cross‐citation data, we find an inverted U‐shaped pattern over time that is influenced by firm‐level and relational factors. Technological similarity only modestly increases learning in the initial stages of a relationship, but moderate levels substantially increase knowledge flows later in the alliance. High technological diversity is related to higher initial learning rates, but the effects diminish over time. Somewhat surprisingly, research and development intensity is negatively related to initial learning rates but has a considerable positive effect later in the relationship. We suggest that initial learning rates in alliances may be constrained by the capacity to absorb knowledge, while later‐stage outcomes are constrained by exploitation capacity. Copyright © 2012 John Wiley & Sons, Ltd.     

FDI spillovers in an emerging market: the role of foreign firms' country origin diversity and domestic firms' absorptive capacity

Prior literature on foreign direct investment (FDI) spillovers has mainly focused on how the presence of FDI affects the productivity of domestic firms. In this study, we advance the literature by examining the effect of the diversity of FDI country origins on the productivity of domestic firms. We propose that the diversity of FDI country origins can facilitate FDI spillovers by increasing the variety of technologies and management practices brought by foreign firms, to which domestic firms are exposed and that they can potentially utilize. Further, the extent to which domestic firms can utilize these technologies and practices depends upon their absorptive capacity. Using panel data on Chinese manufacturing firms during the period 1998–2003, our results support these propositions. We find that the diversity of FDI country origins in an industry has a positive relationship with the productivity of domestic firms in the industry. This positive relationship is stronger when domestic firms are larger, and when the technology gap between FDI and the domestic firms is intermediate. Copyright © 2010 John Wiley & Sons, Ltd.     

The effect of national culture on the choice between licensing and direct foreign investment

This paper argues that national differences in levels of trust impact perceptions of transactions costs and thereby influence the desirability of internalization and the choice of foreign market entry mode. The paper tests this framework on industry level data from the United States Commerce Department's Benchmark Survey of operations of U.S. -based manufacturing multinational corporations in 1977 and 1982, and shows that cultural differences in trust do influence perceptions of transaction costs and the preference for direct foreign investment across countries.     

Entrepreneurial orientation‐as‐experimentation and firm performance: The enabling role of absorptive capacity

According to the perspective of entrepreneurial orientation‐as‐experimentation, entrepreneurial orientation (EO) increases variability in innovation outcomes. Although increased variability in the innovation portfolio could increase performance, it could also lead to a decline in performance. We propose that absorptive capacity plays a role in both increasing and managing variations in innovation outcomes. Potential absorptive capacity enhances the effects of EO on variability in innovation outcomes, whereas realized absorptive capacity helps transform and exploit variability in innovation outcomes to enhance firm performance. Copyright © 2014 John Wiley & Sons, Ltd.     

The Child as Learner, Critic, Inventor, and Technology Design Partner: An Analysis of Three Years of Swedish Student Journals

From Autumn 1998 to Spring 2001, 27 Swedish children (14, at age 5 and 13, at age 7) partnered with an interdisciplinary and international group of researchers supported by a grant from the European Union to create new storytelling technologies for children. After each of the many design activities, children were asked to reflect with drawings and/or writing in a bound paper journal. As the project concluded in the third year, the children's journals were analyzed and four constructs emerged from the data: learner, critic, inventor, and technology design partner. This study examines the motivation for such a research and learning experience, describes the changes in roles we saw represented in our child partners' journals, and suggests possible future directions for educators and technology developers. This revised version was published online in July 2006 with corrections to the Cover Date.     

Top management team diversity and innovativeness: The moderating role of interfunctional coordination

Top management team (TMT) diversity has received considerable attention in the academic literature as well as in the corporate arena. Our paper develops a contingent model on how top management team diversity acts as a form of human capital and can have a positive effect on innovativeness when it is effectively leveraged with favorable social capital. Our theoretical underpinning rests on the argument that greater interfunctional coordination is a source of internal social capital, which mitigates the costs while at the same time highlights the benefits associated with TMT diversity. By testing our model with TMT executives, the results generally supported our hypothesis in that the effect of TMT diversity on innovativeness was positive as interfunctional coordination increased. Implications for marketing theory and practice are discussed.     

Alliance networks and firm performance: The impact of repeated partnerships

A phenomenon that has become the focus of recent research on interorganizational alliance network growth is that firms often enter into repeated relationships with prior partners. The implications of this tendency on corporate performance, however, are not well understood. From transaction cost and network perspectives, I test competing hypotheses on a large sample of multinational corporations. My results indicate clearly that firms not only often do enter into repeated equity‐based partnerships but also that those with a greater propensity to do so experience inferior economic performance. Further, statistical tests indicate that the negative effect of repeated partnerships on performance is particularly strong in environments of greater technological uncertainty. Copyright © 2007 John Wiley & Sons, Ltd.     

The influence of position and gender on personal networks in a UK professional service

This paper presents empirical findings regarding the content and process of personal contact or social networks and networking of practitioners in a professional service. The focus of the study is public relations practitioners operating in seven consultancies across the UK, in Manchester, London, Yorkshire and Cheshire. Using qualitative methodologies including in-depth interviews and network mapping, the study reveals practitioners' network size and variety of contacts, and their role in client acquisition and retention. In particular, the study suggests that position and gender are two key influences on practitioners' personal networks. The study appears to identify that managers may have the smallest networks compared to their colleagues and especially lack weak tie contacts in the form of friends, and that female practitioners may have larger and more varied personal contact networks than men. The study thus offers an insight into personal network membership for public relations practitioners, hitherto unexplored, plus a deeper understanding of interactional dimensions of social networks and the gendered nature of networking in the UK public relations sector.     

The impact of U.S. company internationalization on top management team advice networks: a tacit knowledge perspective

This study surveys 37 U.S. multinational corporations (MNCs) to examine the effect of internationalization on one dimension of the top management team’s (TMT’s) character: international business advice network density. This study draws on international business (IB) theory, the resource‐based view of the firm, and philosophy of science and its view of tacit knowledge. Results show that both the firm’s internationalization extent, and the interdependence that exists across its country–market activities, are positively related to the TMT’s IB advice network density. As the extent of the MNC’s business outside the United States grows and the linkages among its IB units intensify, the demand for IB expertise within the TMT increases, TMT members share each other’s knowledge of IB more extensively and the TMT’s IB advice network density increases. Copyright © 1999 John Wiley & Sons, Ltd.