The Impact of Captive Innovation Offshoring on the Effectiveness of Organizational Adaptation

Elisabeth Baier (), Christian Rammer and Torben Schubert ()
Additional contact information
Elisabeth Baier: PTV Group AG, Karlsruhe, Germany
Torben Schubert: CIRCLE, Lund University & Fraunhofer ISI, Karlsruhe, Germany

No 2015/22, Papers in Innovation Studies from Lund University, CIRCLE - Centre for Innovation Research

Abstract: We analyze the effects of captive offshoring of innovation activities on the ability of the firms to adapt their organizational structures. Basing our arguments on complexity theory, we use three consecutive waves of the German part of the Community Innovation Survey to test our hypotheses. We find an inverted u-shape of innovation offshoring on the effectiveness of organizational adaptability, implying an optimal threshold value of innovation offshoring. This value is 11% for share of offshored R&D, 15% for downstream innovation activities such as local market adaptation, and 34% for design activities. We also analyze several contingency variables. In particular, we show that the costs of innovation offshoring in terms of reduced organizational adaptation are increased by a regional dispersion of the offshoring activities and strong embeddedness in onshore networks. We also show that smaller firms find it easier to deal with the management complexity induced by geographical dispersion of innovation activities.

Keywords: Internationalization; Offshoring; Innovation; Organizational Adaptation; Organizational Adaptability (search for similar items in EconPapers)
JEL-codes: O31 O32 (search for similar items in EconPapers)
Pages: 32 pages
Date: 2015-06-21
New Economics Papers: this item is included in nep-cse, nep-ino, nep-knm, nep-sbm, nep-tid and nep-ure
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (21)

Downloads: (external link)
http://wp.circle.lu.se/upload/CIRCLE/workingpapers/201522_baier_et_al.pdf (application/pdf)

Related works:
Journal Article: The Impact of Captive Innovation Offshoring on the Effectiveness of Organizational Adaptation (2015)
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:hhs:lucirc:2015_022

Access Statistics for this paper

More papers in Papers in Innovation Studies from Lund University, CIRCLE - Centre for Innovation Research CIRCLE - Centre for Innovation Research, Lund University, PO Box 117, SE-22100 Lund, Sweden. Contact information at EDIRC.
Bibliographic data for series maintained by Torben Schubert ().