R&D activity and firm performance: mapping the field

In the global world R&D is at the core of business strategy for companies to maintain their competitive position on the market. Nowadays, R&D activity is becoming linked with firms' growth and profitability. The understanding of the linkage between R&D activity and firm performance is relevant to R&D departments as it helps managers to make strategic choices. This study aims to examine the flow of knowledge in the research area and suggest guidelines for future research. The study mainly focuses on the field of R&D management and provides a systematic literature review by applying complementary bibliometric analysis techniques: co-citation analysis of references and bibliographic coupling analysis of documents. I systematically analyze the existing literature published in peer-reviewed journals from 1980 to 2020. It is found that the literature insists on contradictory results about the relationship between R&D and firm performance. Moreover, there is a quite limited amount of studies concerning the role of various factors affecting R&D-performance relationships. For theory development, this paper summarizes the main concepts in the field and identifies several research gaps of the literature in terms of theory and methodology. It also establishes a conceptual framework of the study and provides suggestions for future research. From managerial perspectives, the study shades a light on the question of whether R&D activity is linked to gaining a higher profitability and provides guidelines for policy makers with regard to the implications of strategic decision-making in R&D.