Managing Synergistic Innovations in Global R&D

Managing Synergistic Innovations in Global R&D

Managing Synergistic Innovations in Global R&D

Managing Synergistic Innovations in Global R&D

Synopsis

Multinational corporations claim that their synergistic innovative capabilities--their ability to create and deploy innovations rapidly and successfully--have been enhanced by global R&D. But have they? In attempting to answer this question, the authors seemlessly integrate rigorous quantitative analysis--e.g., multivariate regression, factor analysis, and partial least squares analysis--with qualitative analysis of data from interviews and surveys.

Excerpt

Although the globalization of research and development (R&D) can be traced back to the 1880s, not until a century later did we witness a real trend by multinational corporations to conduct an increasing share of their R&D outside of their home countries. This trend is driven to a large extent by increasing global competition, the ongoing development of sophisticated information and communication technologies, the increasing technological sophistication of several emerging nations, the concentration of specialized, sophisticated, technical resources in a few locations around the world, the severe shortage of highly skilled scientists and engineers among the advanced nations of the world, the increasing integration of the world economy, and shifts in demand and supply conditions on a global scale. This new trend is in sharp contrast to previous practices in which multinational corporations concentrated the bulk of their R&D in their home countries.

In the traditional R&D paradigm, multinational corporations, especially knowledge-intensive corporations, tended to concentrate their R&D activities at or near the headquarters facilities of the parent company. The primary role of overseas R&D labs was to provide product adaptation or modification services to overseas manufacturing facilities. Consequently, overseas subsidiaries labs were not regarded as an important component in the R&D strategy of the firms since knowledge flows were unidirectional—from the headquarters to the overseas subsidiary not the other way around. In the new paradigm described as globalization of R&D, the overseas subsidiary labs are integrated with other R&D sites around the world, and every attempt is made to encourage knowledge flows from the headquarters to the subsidiary, and vice versa, and among subsidiaries themselves. It seems that multinational R&D managers have gradually come to accept the notion that the locus of innovation is no longer the

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