Stock Of Technological Knowledge Research Articles

Cascading Failures in New Product Development

While product failures are harmful to both consumers and firms, extant research in technology management and innovation does not provide sufficient answers for why they occur. In this research, I investigate what causes firms to experience product failures when they develop new products through the exploitation of their existing stock of technological knowledge. I examine an underexplored condition where a firm’s existing technology has undiscovered flaws to show how these hidden defects affect its new product quality. I find that if a firm develops new products by building on its prior technology with hidden defects, the new products have a high risk of failure. I reason that a firm’s bias toward exploitation leads the firm to fall into a competency trap and to overlook failures in its new product development process. Moreover, I argue that new products which recombine technologies across a firm’s distant technological and/or organizational boundaries are less likely to fall into this persistence of failure. Using a unique dataset on medical device recalls and predicate devices, I provide empirical evidence supporting my arguments.

Technological Knowledge Spillover in Business Groups: Evidence from China

ABSTRACT We examine the spillover effect of technological knowledge within business groups using a sample of Chinese A-share listed companies from 2007–2019. We find the parent company’s technological knowledge stock improves its subsidiaries’ innovation outputs. The lower communication cost resulting from the opening of a high-speed railway between a parent company and its subsidiaries effectively promotes the transfer of technological knowledge. Heterogeneity tests show that the spillover effects are more significant in business groups where the parent company has lower asset specificity or centralized control. Overall, our evidence suggests that business groups are essential in promoting innovative activities, primarily through technological knowledge spillover.

R&D employee training, the stock of technological knowledge, and R&D productivity

This paper investigates the conditioning role of R&D employee training in the effect of the stock of technological knowledge on firm R&D productivity. We suggest that the development of R&D human capital through training enhances firm‐specific technological competence, thereby enabling firms to better utilize their stock of technological knowledge as a source of technological opportunities. Specifically, while a trap of path dependency may hamper the proper utilization of the firm‐specific stock of technological knowledge, R&D employee training reinforces the standing‐on‐the‐shoulders effect of the stock of technological knowledge, thereby offsetting, at least partially, its fishing‐out effect due to depleting technological opportunities. Using panel data of Korean manufacturing firms, we show that R&D employee training positively moderates the effect of the stock of technological knowledge on firm R&D productivity. Furthermore, we suggest several factors that influence the positive moderating effect of R&D employee training such as the degree of knowledge sharing among R&D employees within each firm, the strength of industry R&D appropriability, and the industry R&D intensity.

Jumping Out or Following theRoad Post-Converstion Innovation Behavior of InternationalJointVentures

This study examines the effect of converting international joint ventures (IJV) to either local for foreign wholly owned entities on the subsequent impact of innovation from the perspective of knowledge-based view, complementary asset and knowledge recombination literature. We argue that different knowledge compositions (technological vs. complementary) of post-conversion firms affect the way they integrate learnt knowledge with existing ones and subsequent recombination strategies. Based on longitudinal data in China between 1998 and 2013, we use an instrumental variable (IV) estimation to strengthen identification of causal effects. We find that substantial stock of complementary knowledge of post-conversion local wholly owned subsidiaries (LWOS) promotes subsequent recombinant reuse (i.e., reconfigure combinations already known to the firm), while hinders their recombinant creation (i.e., create combinations new to the firm). In contrast, substantial stock of technological knowledge increases the likelihood that post-conversion foreign wholly owned subsidiary (FWOS) will take a recombinant creation strategy, but decreases the likelihood of taking a recombinant reuse strategy. Contingencies such as knowledge features obtained through IJV and external appropriability regimes are discussed. Our study contributes to the literature on IJV operation mode, knowledge-based view, complementary asset, and knowledge recombination.

Patenting in 4IR technologies and firm performance

Abstract We investigate whether firm performance is related to the accumulated stock of technological knowledge associated with the Fourth Industrial Revolution (4IR) and, if so, whether the firm’s history in 4IR technology development affects such a relationship. We exploit a rich longitudinal matched patent-firm data set on the population of large firms that filed 4IR patents at the European Patent Office (EPO) between 2009 and 2014, while reconstructing their patent stocks from 1985 onward. To identify 4IR patents, we use a novel two-step procedure proposed by EPO (2020, Patents and the Fourth Industrial Revolution: The Global Technology Trends Enabling the Data-Driven Economy, European Patent Office), based on Cooperative Patent Classification codes and on a full-text patent search. Our results show a positive and significant relationship between firms’ stocks of 4IR patents and labor and total factor productivity. We also find that firms with a long history in 4IR patent filings benefit more from the development of 4IR technological capabilities than later applicants. Conversely, we find that firm profitability is not significantly related to the stock of 4IR patents, which suggests that the returns from 4IR technological developments may be slow to be cashed in. Finally, we find that the positive relationship with productivity is stronger for 4IR-related wireless technology and for artificial intelligence, cognitive computing, and big data analytics.

How do patent assets affect firm performance? From the perspective of industrial difference

ABSTRACT In the era of technological innovation, some companies own similar patent assets but capture different profits. The paper aims to explore whether and why there are different effects of patent assets on firm performance across industries. The listed corporations in the Growth Enterprises Market (GEM) of Shenzhen Stock Exchange, China, are taken as samples, which are categorised as three industries: the technology-intensive industry, capital-intensive industry, and labour-intensive industry, in light of the production factors. Moreover, the multiple stepwise regression and the fixed effects model are utilised. This paper highlights the effects of patent assets on firm performance are different across industries. Patent quality strongly influences firm performance in the technology-intensive industry, while patent count increases firm performance in the capital-intensive industry and labour-intensive industries. Notably, technological knowledge stock owned by companies plays a moderating role in influencing patent assets on firm performance in the technology-intensive industry. Our findings enrich the research on patent assets influencing financial performance from the industrial difference perspective and suggest that companies in different industries should take differentiated patent strategies to improve firm performance.

R&D Employee Training, the Stock of Technological Knowledge, and R&D productivity

This paper investigates the conditioning role of R&D employee training on the effect of the stock of technological knowledge on firm R&D productivity. We suggest that R&D employee training enhances firm-specific technological competence, thereby enabling the firm to better utilize the stock of technological knowledge as a source of technological opportunities. Specifically, while a trap of path dependency may hamper the proper utilization of the firm-specific stock of technological knowledge, R&D employee training reinforces the standing-on-the-shoulders effect of the stock of technological knowledge, thereby offsetting, at least partially, its fishing-out effect due to depleting technological opportunities. Using panel data of Korean manufacturing firms, we show R&D employee training positively moderates the effect of the stock of technological knowledge on firm R&D productivity. Furthermore, we suggest several factors that influence the positive moderating effect of R&D employee training such as the degree of knowledge sharing among R&D employees within each firm, the strength of industry R&D appropriability, and the intensity of industry R&D.

Going Revolutionary: The Impact of 4IR Technology Development on Firm Performance

Drawing on the knowledge-based view of the firm, we investigate whether firm performance is related to the accumulated stock of technological knowledge associated with the Fourth Industrial Revolution (4IR), and what contextual factors affect this relationship. We test our research questions on a longitudinal matched patent-firm data set on large firms filing 4IR patents at the European Patent Office (EPO). Our results, which control for a large number of patent- and firm-level variables as well as firm fixed unobserved heterogeneity, show a significant and economically relevant positive association between the development of 4IR technologies and firm productivity. However, no significant relationship with firm profitability is detected, thereby suggesting that the returns from 4IR technological developments are slow to cash in. We also find that late innovators benefit more from the development of 4IR technological capabilities than early innovators and experience a substantial “boost effect”. We provide empirical support to an explanation of these findings in terms of the ability of late innovators to (i) manage the inherent complexity of the bundle of technologies comprising the 4IR and (ii) exploit profitable downstream applications of the 4IR.

Enabling and leveraging ambidexterity: influence of strategic orientations and knowledge stock

PurposeThis paper aims to develop and empirically test a framework articulating the effects of strategic orientations (entrepreneurial orientation and market orientation) on leveraging ambidexterity. Further, the paper examines the moderating effects of knowledge stock (market knowledge and technological knowledge) on the relationship between ambidexterity and firm performance to gain additional insights into how ambidexterity can be leveraged in an organization.Design/methodology/approachData were obtained from CEOs (or equivalent members of the top management team) of 234 firms. The adequacy and psychometric properties of all measures were evaluated and purified using a maximum likelihood confirmatory factor analysis (CFA), and the hypotheses were tested using ordinary least squares (OLS). A number of post hoc tests were conducted to develop a nuanced understanding of proposed effects.FindingsWhile both strategic orientations enhance an organization’s ability to be ambidextrous, results show that some types of knowledge stocks facilitate, whereas other types hinder the influence of ambidexterity on firm performance.Research limitations/implicationsBoth strategic orientations enable ambidexterity; however, technological knowledge stock impedes the effect of ambidexterity on firm performance, while market knowledge stock enhances this relation. Cross-sectional nature of the study imposes limitations on causal inferences.Practical implicationsDifferent strategic orientations provide organizations with a cluster of knowledge acquisition and utilization capabilities that enable ambidexterity. However, organizations should be wary of indiscriminate accumulation of knowledge stocks – while certain types enhance the effect of ambidexterity, others may create competency traps or core rigidities and inhibit the effect of ambidexterity.Originality/valueThis study integrates related, yet hitherto fragmented, research streams to demonstrate the interconnectedness between strategic orientations, ambidexterity and existing knowledge stock. Several theoretical and managerial implications are identified.

Analysis of technological knowledge stock and prediction of its future development potential: The case of lithium-ion batteries

Amidst growing environmental challenges and increasing penetration of sustainable energy production, the development of efficient energy storage system (EES) is indispensable to fully benefit from the use of intermittent renewable energy sources. Although lithium-ion batteries (LIBs) have been the dominant energy storage technology for applications in consumer electronics, electrified transportation and stationary electricity storage, further technological progress is required for achieving the climate protection objectives. In this context, continuous exploration of new technological opportunities is favorable to advance the global energy transition towards sustainability to success. To facilitate such progress and to avoid potential technological lock-in situation, understanding the underlying latent knowledge construct revealed in patents may prove beneficial. However, previous studies have either focused on analyzing the technological improvements along a particular development path or emphasizing the necessity for improvements in environmental-economic dimensions. Accordingly, a novel patent-based analysis framework is proposed to obtain an inclusive view on the continuing path of technology development concerning the research of LIBs as well as to predict its future development potential based on two machine learning algorithms: Principal component analysis (PCA) and random forest classifier (RFC). In this study, PCA is firstly applied to group various knowledge areas into key technological knowledge stocks. Building upon these results, RFC is adopted to forecast the future developmental potential of technological knowledge areas. The findings show that the research landscape of LIBs is a dynamic environment where new knowledge stocks emerged overtime and the identified knowledge stocks within a defined time interval play an orchestrating role in the advancement of lithium-ion battery technology. In particular, knowledge stocks related to battery management system and hybrid capacitors have gained relevance. The proposed analysis framework can be used to track the past chronology of knowledge accumulation trajectory and can proactively enhance the knowledge management capabilities of experts, who wish to create a path towards a low-carbon economy.

Obstacles to innovation in Brazil

Through an investigation of data available from the Brazilian Innovation Survey (Pesquisa de Inovação) of the Brazilian Institute of Geography and Statistics (Instituto Brasileiro de Geografia e Estatística) and from a national survey on university–firm interactions (the BR Survey), the authors show that Brazilian industrial firms lack qualified individuals for two key activities: the promotion of innovation and the establishment of a dialogue between universities and firms. Brazilian firms’ weaknesses and the inadequacy of the workforce supply generate scarce (or inadequate) ‘know-why’. Furthermore, a restricted perspective in Brazilian universities, focused on creating a more educated society rather than augmenting the stock of technological knowledge, constrains the generation of ‘know-what’ and ‘know-who’.

Regional export advantage of rising power SMEs

Purpose– The purpose of this study is to examine the subnational regional dimension of exports by small and medium-sized enterprises (SMEs) in India, one of the prominent emerging economies or “rising powers”.Design/methodology/approach– To understand the forces driving the variation in subnational region’s share in international business of rising power SMEs, an analytical conceptual framework on regional export advantage (REA) was formulated based on the review of relevant theoretical and empirical literature. The model was estimated for Indian states using the most appropriate and recently developed econometric technique of fractional logit model.Findings– The paper provides evidence that the emergence of exports by rising Indian power SMEs is geographically limited to a few select regions/states. Southern Indian states alone accounted for half of exports from SMEs in the organized manufacturing sector during 2000-2008, followed by Western India. The REA analysis has brought to the fore that regional stock of technological knowledge, availability of skill, port facilities, urban areas and foreign direct investment stocks are crucial factors determining states’ share in SME exports across technological subcategories. However, the size and sophistication of local demand continue to influence states’ efforts at enhancing exports by SMEs, at least those belonging to the medium- and high-technology categories.Research limitations/implications– The proposed empirical framework could be extended to include institutional and political economy factors. Its application to subnational regional shares in total exports by all firms taking into account fixed effects for regions may be another feasible line of future research.Practical implications– Empirical findings recognize that appropriate strategies by subnational policymakers are important for a region to achieve a higher contribution in national SME exports. Subnational policy measures aimed at upgradation of regional technological assets and skill base through the promotion of technology clusters and R & D of local firms, facilitation and creation of better industry-university linkages and investments in education and training institution may help the states to gain higher export advantage.Originality/value– This paper provides new analytics and insights into the role of subnational spaces in the internationalization of rising power SMEs from India and serves to contribute to the extant international business research that is predominantly occupied with “nation” as the unit of location.

"Managerial Capacity, Absorptive Capacity and the Performance of Small Software Companies"

In this article, we use the Resource-Based View and the Knowledge-Based View frameworks to develop a model to explains the variation in the performance of software development SMEs. Statistical tests conducted with data collected from 265 small and medium Brazilian companies suggest that: (i) a company’s stock of technological knowledge as well as managerial capacity positively influence its absorptive capacity; (ii) managerial capacity, absorptive capacity and the flexibility of IT infrastructure are predictors of software development performance; and (iii) managerial capacity, absorptive capacity and software development performance positively influence organizational performance. We discuss theoretical and practical implications of these findings.

Exporting by Indian small and medium enterprises: role of regional technological knowledge, agglomeration and foreign direct investment

This study analyses regional determinants of export performance of small and medium enterprises (SMEs) in India. The export determinant analysis brings out the significance of certain key physical and economic infrastructure for SMEs, particularly access to roads, ports and loan finance. Local market conditions, namely the size, growth and per capita income of the host states also favourably affect SME export activities. State's stock of technological knowledge also encourages SME exporting. While direct competition with foreign players tends to dampen exporting by SMEs, foreign shareholding participation in SMEs allows affiliated firms to achieve higher level of exports. Apart from improving the key business support infrastructure, export orientation of SMEs could be enhanced by networking them with R&D facilities and providing them easier access to information about overseas markets. Relatively smaller enterprises need greater support as they are disadvantaged by their size.

Resource-Based View, Knowledge-Based View and the Performance of Software Development Companies

Software development companies face a globalized, highly competitive and turbulent environment, where efficiency, efficacy and innovation capacity are critical for survival. In this context, small and medium enterprises (SMEs) tend to suffer the most due to the scarcity of resources to which they are usually subjected and their dependence on a few more powerful customers. This paper describes the elaboration and test of a model that draws on the resource-based view and knowledge-based view to explain the differences in performance of software SMEs. The analysis of data collected from 265 Brazilian companies suggests that: absorptive capacity contributes significantly to the development of a company’s stock of technological knowledge; the flexibility of the IT infrastructure, managerial capacity, and IT technological knowledge are strong predictors of software development performance; and organizational performance is positively influenced by software development performance and managerial capacity. The implications of these findings are then discussed.

Varying effects of enhanced and new corporate technological knowledge in responding to technological change

PurposeThe purpose of this paper is to explore how enhanced and new technological knowledge of firms affects their performance under varying rates of technological change.Design/methodology/approachA large‐sample empirical study of US manufacturing firms is used. The main independent variables are measured using firms' patent data. Three hypotheses were developed based on theory and were tested using multivariate regressions. To increase reliability, alternative industry and firm explanators of performance were controlled for.FindingsIt was found that performance effects of enhanced technological knowledge increase with increasing rate of technological change. Effects of each knowledge dimension are found to be non‐linear. New technological knowledge has no independent effect on performance but acts jointly with enhanced knowledge in improving performance under moderate to rapid rates of technological change.Research limitations/implicationsThe study is narrow in scope being a fine‐grained analysis of a firm's technological competence. It does not take into account the role of marketing and administrative competence.Originality/valueThis is one of the few studies to disaggregate a firm's total stock of technological knowledge into its enhanced and new components.

Towards an open R&D system: Internal R&D investment, external knowledge acquisition and innovative performance

To cope with fast-changing business environments, firms are increasingly opening up their organizational boundaries to tap into external source of knowledge. By restructuring their R&D system, firms face the challenge of balancing internal and external R&D activities to profit from external knowledge. This paper examines the influence of R&D configuration on innovative performance and the moderating role of a firm's R&D capacity.The findings suggest that firms that increasingly rely on external R&D activities have a better innovative performance, yet up to a point. Beyond this threshold, a greater share of external R&D activities reduces a firm's innovative performance. And such substitution effect is larger for firms with greater R&D capacity. Overall, this paper provides a better understanding of the open innovation paradigm by suggesting that the opportunity cost for further opening up R&D borders is higher for firms with a superior technological knowledge stock.

Technological-knowledge dynamics in lab-equipment models of quality ladders

The Perpetual Inventory Model (PIM) assumes that, in each period, an arbitrary constant fraction of technological-knowledge stock is lost. We give a theoretical background to the PIM by showing that the technological-knowledge accumulation follows a dynamic process with an endogenous depreciation rate, which remains stable in steady state.

What really matters: Discounting, technological change and sustainable climate

This paper discusses the interplay between the choice of the discount rate, greenhouse gas mitigation and endogenous technological change. Neglecting the issue of uncertainty it is shown that the Green Golden Rule stock of atmospheric carbon is uniquely determined, but is not affected by technological change. More generally it is shown analytically within the framework of a reduced model of integrated assessment that the optimal stationary stocks of atmospheric carbon depend on the choice of the discount rate, but are independent of the stock of technological knowledge. These results are then reinforced numerically in a fully specified integrated assessment analysis.

Patent families: When do different definitions really matter?

Data on patent families is used in economic and statistical studies for many purposes, including the analysis of patenting strategies of applicants, the monitoring of the globalization of inventions and the comparison of the inventive performance and stock of technological knowledge of different countries. Most of these studies take family data as given, as a sort of black box, without going into the details of their underlying methodologies and patent linkages. However, different definitions of patent families may lead to different results. One of the purposes of this paper is to compare the most commonly used definitions of patent families and identify factors causing differences in family outcomes. Another objective is to shed light into the internal structure of patent families and see how it affects patent family outcomes based on different definitions. An automated characterization of the internal structures of all extended families with earliest priorities in the 1990s, as recorded in PATSTAT, found that family counts are not affected by the choice of patent family definitions in 75% of families. However, different definitions may really matter for the 25% of families with complex structures and lead to different family compositions, which might have an impact, for instance, on econometric studies using family size as a proxy of patent value.