Networked path towards technology innovation: the case of Taiwan semiconductor manufacturing company

Abstract

This paper deals with why flexible networks can be efficient in responding to rapidly changing consumer demands, developing new technologies, and disseminating information regarding commercialisation. Taiwanese small firms, along with their Italian counterparts, have often been cited as paradigmatic cases of demand-responsive network structures. In the semiconductor sector of Taiwan, the government research institutes and their policy networks with the private sector investors substantially cleared the hurdles of uncertainty regarding the initial investment decisions of R&D. Simultaneously, international networks that exploited the richness of structural holes facilitated smooth and speedy transfers of new technologies. This paper finds that technological innovation within a small firm network cannot be successful without the establishment of a domestic policy network and an international supply network.