Effect of Alliance Experience on New Alliance Formations and Internal R&D Capabilities

Gunno Park () and Jina Kang ()
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Gunno Park: Samsung SDS
Jina Kang: Technology Management, Economics, and Policy Program, College of Engineering, Seoul National University

No 2014119, TEMEP Discussion Papers from Seoul National University; Technology Management, Economics, and Policy Program (TEMEP)

Abstract: Although their advantages are well-known, technology alliance may not always positively affect innovative performance. Previous studies have found several explanations for this problem. Technology alliances often require excessive resources and capabilities to form and maintain relationships with partners. In addition, they cause a diversion of managerial attention and functions from internal R&D activities, yet many firms are often unequipped to deal with these problems. In this paper, we hypothesize that firms often execute an inefficient technology alliance strategy, thus negatively affecting their innovative capabilities and consequently reducing subsequent innovation performance. More specifically, we test whether firms with greater prior experience on technology alliances are more likely to execute inefficient technology alliance strategies. Second, we try to investigate negative effects of technology alliances on firms’ internal R&D capabilities. To test our hypotheses, we employ data from 9629 technology alliances in the US biotechnology and pharmaceutical industries. Implications from these analyses are offered for executives and technology alliance strategies. Specifically, we propose that firms should undertake technology alliances while considering the negative aspects and the firm’s limited resources.

Keywords: Alliance Experience; Organizational Routine; Alliance Formation; Internal R&D Capability. (search for similar items in EconPapers)
JEL-codes: D23 L22 L24 O32 (search for similar items in EconPapers)
Pages: 21 pages
Date: 2014-09, Revised 2014-09
New Economics Papers: this item is included in nep-bec, nep-com, nep-cse, nep-ino and nep-sbm
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Published in International Association for Management of Technology (IAMOT) Conference, Miami, FL, 2011

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http://temep-repec.my-groups.de/DP-119.pdf Revised version, 2014 (application/pdf)

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Persistent link: https://EconPapers.repec.org/RePEc:snv:dp2009:2014119

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