The influence of university-firm cooperation on firm value chain

Abstract

Value chain analysis can expose strategic and operational misalignments within chains, and the consequential misallocation of resources, and hence opportunities for improvements which create value and economic sustainability. The purpose of this paper is to study how strong is the university-firm cooperation influence on firm value chains and how can this cooperation influence firm and university innovation and performance. The empirical analysis is based on data gathered through a questionnaire administered to a sample of Slovak SMEs operated in the area of ICT. The findings show that only contractual university-firm relationships have a direct and significant effect on innovation, whereas relational activities promote and support contractual activities. The findings have managerial implications not just for firms, but also for universities. University-firm relationships contribute to regional and global development, because they foster innovation processes regarding firms' strategies at those. In this liaison, universities' role usually is to promote knowledge-based economic development, which is basic for sustainable economic growt. The higher education institutions are facing an increasingly competitive environment with growing financial constraints, universities are strongly motivated to engage more actively with the firm, so as to establish new funding streams and secure additional research investment. This relationship should be beneficial for both firms and universities. Innovative firms are constantly searching for new ways to internalize external knowledge into their production function. With this aim, firms have found that the university-firm cooperation is a valuable mechanism to access to new technological resources, which can contribute to faster development of innovation, improved market access, economies of scale and scope, and cost sharing and risk spreading In this context, universities have been recognized as a capable research partner for solving R&D problems and as advisers on technology strategies and by supporting the technology generation and/or the adoption of a new technology. Moreover, the cooperation with universities has been characterized by the timely appropriation of very-new technological opportunities and by the increment on the innovation sales, as well as the increase in the propensity to apply for patents. Several empirical studies have attempted to identify the factors determining the university-firm cooperation in innovation activities, concluding that this type of cooperation is based on the complementarity on the innovation processes, and on the uncertainty level of the innovation results. On the other hand, and based on a firm level analysis, some authors concluded that university-firm cooperation depends on the firm's absorptive capacity, on its innovative capacity, on its proximity to fundamental research, and in some firm-specific characteristics, like size and industrial affiliation.