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Knowledge integration using product R&D outsourcing in biotechnology

Listed author(s):
  • Kamuriwo, Dzidziso Samuel
  • Baden-Fuller, Charles
Registered author(s):

    We build on systems integration literature to explain how and why knowledge integration of non-modular products is based on a strategic choice between internalizing and outsourcing core R&D. The under-researched choice of outsourcing core R&D on an on-going basis appears to face risks of higher transactions costs and loss of control. We illuminate these choices in a comparative analysis of two longitudinal cases that compare an internally focused R&D intensive firm and an externally focused R&D intensive firm; and we show how the externally focused approach can avoid risks by framing non-modular outsourcing as modular even though it is not so and by engaging in a social process of communication to achieve a common agreement between partners concerning the direction of efforts and thus effectively reduce highly iterative knowledge exchange between modules. Our findings add to our understanding of the systems integration literature; the nature of firm product system strategies, as well as firm boundaries in a knowledge economy.

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    File URL: http://www.sciencedirect.com/science/article/pii/S0048733316300221
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    Article provided by Elsevier in its journal Research Policy.

    Volume (Year): 45 (2016)
    Issue (Month): 5 ()
    Pages: 1031-1045

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    Handle: RePEc:eee:respol:v:45:y:2016:i:5:p:1031-1045
    DOI: 10.1016/j.respol.2016.02.009
    Contact details of provider: Web page: http://www.elsevier.com/locate/respol

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    1. Jason Owen-Smith & Massimo Riccaboni & Fabio Pammolli & Walter W. Powell, 2002. "A Comparison of U.S. and European University-Industry Relations in the Life Sciences," Management Science, INFORMS, vol. 48(1), pages 24-43, January.
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    8. Rothaermel, Frank T. & Deeds, David L., 2006. "Alliance type, alliance experience and alliance management capability in high-technology ventures," Journal of Business Venturing, Elsevier, vol. 21(4), pages 429-460, July.
    9. Jansen, J.J.P. & van den Bosch, F.A.J. & Volberda, H.W., 2005. "Managing Potential and Realized Absorptive Capacity: How do Organizational Antecedents matter?," ERIM Report Series Research in Management ERS-2005-025-STR, Erasmus Research Institute of Management (ERIM), ERIM is the joint research institute of the Rotterdam School of Management, Erasmus University and the Erasmus School of Economics (ESE) at Erasmus University Rotterdam.
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