The impact of R&D‐specific factors on the attractiveness of small‐ and medium‐sized enterprises as partners vis‐à‐vis alliance formation in large emerging economies

Abstract

This study examines the impact of research and development (R&D)‐specific factors in determining the likelihood of small‐ and medium‐sized enterprises (SMEs) from developed countries to be attractive partners vis‐à‐vis forming alliances with SMEs from large emerging economies (LEEs). This study is founded on the knowledge‐accessing theory of alliance formation, which emphasises the higher efficiency gains of knowledge application as opposed to knowledge generation. We extend this theory to SMEs on the basis that smaller firms, because of their resources constraints and drive to survive, are likely to use alliances to access external knowledge bases leading to new product development (NPD) opportunities because of the low feasibility of acquiring knowledge. As a mix of complex knowledge is necessary to develop most modern products and services, SMEs are also likely to adopt a more flexible operational approach and to accept compromises to forge knowledge‐accessing alliances. We illustrate this theoretical development using primary data collected from British and German biotechnology SMEs, declaring the intention prospectively to form alliances with their counterparts in Brazil. Binary logistic regression was used to identify the factors influencing the likelihood of a firm as an attractive alliance partner. Our results indicate that R&D‐specific factors influence the likelihood of firms to be attractive alliance partners. In particular, firms showing an in‐house innovation history focused on one or few products are more likely to be attractive alliance partners with LEE firms than those that do not. Another R&D‐specific predictor that enhances the chances of alliance partner attractiveness with LEE firms is the firm's focused searching and identifying capability relative to technology or equipment that demonstrates good prospects to improve the firm's line of products. A third predictor refers to the firm's awareness regarding non‐cost obstacles for its own technological development. Implications for policy makers and practitioners are also discussed.

The orchestration of alliance portfolios: The role of alliance portfolio capability

“…More recently, scholars have sought to understand how a firm's knowledge base can influence the management of alliances and alliance portfolios (Grant & Baden-Fuller, 2004;De Mattos, Burgess, & Shaw, 2013;Zhang, 2016). This literature has highlighted the complementarities between a firm's internal knowledge base and its external linkages and has shown its relevance for innovation and increased performance (Enkel, Gassmann, & Chesbrough, 2009;Hughes & Wareham, 2010;Lichtenthaler, 2011;Xia, 2013).…”

Knowledge spillovers: cooperation between universities and KIBS

“…According to Spilková (2008), knowledge and information are the main factors rendering an organisation competitive. Nevertheless, this implies the need to analyse how knowledge spillovers take place between universities and companies alongside the effects of distance between where knowledge emerges and where effectively applied (Hurmelinna-Laukkanen and Puumalainen, 2007;Goldstein, 2009;De Mattos et al, 2013;Derrick and Bryant, 2013). Ferreira et al (2008) verify how universities do play very important roles as drivers of development in their respective regions.…”

What drives SME explorative-exploitative alliance formation: an integrated perspective

“…SMEs possessing valuable resources, tackle environmental uncertainty by using alliances as a strategy, due to the presence of such resources as financial, as opposed to firms which do not possess such resources (Dickson and Weaver, 1997;Mukherjee et al, 2013). In high-growth markets, SMEs tend to form exploration alliances while in low-growth markets they are likely to form exploitation alliances (De Mattos et al, 2013;Yamakawa et al, 2011). Park et al (2002) find that small firms possessing valuable resources form exploration alliances in growing or declining markets by deploying their resources in order to combat the market uncertainty while exploitation alliances are formed in stable environments, to take immediate advantage of the existing resources.…”