Research on emerging market firms (EMFs) has acknowledged the role of innovation in catchingup wi... more Research on emerging market firms (EMFs) has acknowledged the role of innovation in catchingup with advanced economies. Although we know that EMFs' innovation increasingly depends on collaborations and cross-border knowledge flows, less has been said about the effectiveness of foreign and domestic knowledge mechanisms adopted to improve EMFs' innovation performance. We hypothesize that foreign mechanisms rely on diverse knowledge and foster explorative innovation (i.e. innovation that extends the existing local competencies), while domestic mechanisms are more likely to be associated with the exploitation of the local existing competencies. Additionally, we claim that the breadth of EMFs' absorptive capacity strengthens the impact of foreign knowledge mechanisms on explorative innovation, while depth increases the impact of domestic knowledge mechanisms on EMFs' exploitative innovation, thus highlighting that the interplay of knowledge resources internal and external to the firm involve different levels of recombination. Our empirical analyses conducted on a sample of 161 Indian bio-pharmaceutical firms observed from 1997 to 2018 confirm our hypotheses, thus contributing to the literature on EMFs' catching up via internationalization and innovation.
The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In... more The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In response to this popular phenomenon, scholars are examining many learning conduits used by these firms to improve their innovation performance. The various learning conduits used by these firms include technology licensing, government R&D support, university-firm linkages, business groups, government affiliation, outward FDI, international collaborations, inward FDI, outsourcing, exporting and importing. Building on a systematic review of 115 papers on this topic, we find this literature to be unstructured, with no organizing framework. To help researchers take stock and make advancements, we use configurational theorizing to develop a framework that helps understand when and why these emerging economy firms tend to use the different learning conduits. Specifically, we propose that the choice of learning conduits is often driven by two key factors: the relative level of institutional formality of the emerging economy and the relative level of traditional ownership advantages of these firms. Building on these two dimensions, we classify emerging economy firms into four configurations: social network focused firms, laggard firms, leader firms and cutting-edge firms. We generate new insights based on our framework and overview of the existing studies, identify gaps in the literature, and make recommendations about how to extend this growing stream of research.
The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In... more The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In response to this popular phenomenon, scholars are examining many learning conduits used by these firms to improve their innovation performance. The various learning conduits used by these firms include technology licensing, government R&D support, university-firm linkages, business groups, government affiliation, outward FDI, international collaborations, inward FDI, outsourcing, exporting and importing. Building on a systematic review of 115 papers on this topic, we find this literature to be unstructured, with no organizing framework. To help researchers take stock and make advancements, we use configurational theorizing to develop a framework that helps understand when and why these emerging economy firms tend to use the different learning conduits. Specifically, we propose that the choice of learning conduits is often driven by two key factors: the relative level of institutional formality of the emerging economy and the relative level of traditional ownership advantages of these firms. Building on these two dimensions, we classify emerging economy firms into four configurations: social network focused firms, laggard firms, leader firms and cutting-edge firms. We generate new insights based on our framework and overview of the existing studies, identify gaps in the literature, and make recommendations about how to extend this growing stream of research.
This paper examines the antecedents and performance outcomes of sourcing portfolio diversity in f... more This paper examines the antecedents and performance outcomes of sourcing portfolio diversity in firms' new product development (NPD). Sourcing portfolio diversity measures the degree to which a firm uses multiple sourcing choices along both organizational and geographic dimensions including domestic in-house sourcing, domestic outsourcing, captive offshoring, and offshore outsourcing. We extend transaction cost economics (TCE) to the portfolio level of analysis and predict that sourcing portfolio diversity in NPD is driven by heterogeneity in two transactional characteristics-technological application diversity, reflecting asset specificity, and variance in project-stage uncertainty. We also argue that the positive effect of sourcing portfolio diversity on firms' financial performance is driven by aligning sourcing portfolio configuration with the sources of transactional heterogeneity, increased strategic agility, and complementarities between individual sourcing choices. Our empirical study of NPD in the bio-pharmaceutical industry confirms our predictions. We contribute to research on sourcing and NPD by conceptually building and empirically establishing relevance of the sourcing diversity at the portfolio level of analysis and bringing the question of sourcing strategy to the forefront of NPD portfolio management concerns.
This paper examines the antecedents and performance outcomes of sourcing portfolio diversity in f... more This paper examines the antecedents and performance outcomes of sourcing portfolio diversity in firms' new product development (NPD). Sourcing portfolio diversity measures the degree to which a firm uses multiple sourcing choices along both organizational and geographic dimensions including domestic in-house sourcing, domestic outsourcing, captive offshoring, and offshore outsourcing. We extend transaction cost economics (TCE) to the portfolio level of analysis and predict that sourcing portfolio diversity in NPD is driven by heterogeneity in two transactional characteristics-technological application diversity, reflecting asset specificity, and variance in project-stage uncertainty. We also argue that the positive effect of sourcing portfolio diversity on firms' financial performance is driven by aligning sourcing portfolio configuration with the sources of transactional heterogeneity, increased strategic agility, and complementarities between individual sourcing choices. Our empirical study of NPD in the bio-pharmaceutical industry confirms our predictions. We contribute to research on sourcing and NPD by conceptually building and empirically establishing relevance of the sourcing diversity at the portfolio level of analysis and bringing the question of sourcing strategy to the forefront of NPD portfolio management concerns.
Purpose The purpose of this paper is to study the differences in the internationalization process... more Purpose The purpose of this paper is to study the differences in the internationalization process of firms from emerging economies and the impact of their international expansion related choices on the nature of technological innovations developed by these firms. Specifically, the authors compare two principal perspectives on internationalization – the incremental internationalization process (slow, gradually increasing commitments using greenfield investments to similar host countries) and the springboard perspective (aggressive, rapidly increasing commitments using mergers and acquisitions to advanced host countries). Design/methodology/approach Building on key differences between the incremental internationalization and springboard perspectives, the authors argue that differences in the speed and mode of entry, as well as the interaction between the mode of entry and location of internationalization, will lead to differences in the types of technologies (mature versus novel) deve...
Abstract Given the complexity of sourcing choices in R&D, driven by conflicting points of dif... more Abstract Given the complexity of sourcing choices in R&D, driven by conflicting points of difference, scholars have struggled to formulate clear theoretical predictions about which sourcing choices lead to superior performance. Our study contributes to the elucidation of this question by studying both the antecedents and performance consequences (project cost and duration) of alternative sourcing choices in the context of new product development, thus bridging two rarely intersecting streams of research to discover unique insights. We draw from the transaction cost economics (TCE) and organizational learning theory to account for the interdependence of cost- and non-cost related factors in firms’ sourcing choices. Results from our empirical analysis, using data on clinical trials in the global biopharmaceutical industry, show that greater project complexity, project stage uncertainty, and prior sourcing experience determine the sourcing choices a firm makes. We also establish that alternative sourcing choices vary in their ability to minimize project cost versus project duration, and show that prior experience with a sourcing choice is an important moderator of project performance, in addition to being one of the determinants of sourcing choice.
Journal of Global Operations and Strategic Sourcing, 2019
Purpose The purpose of this study is to examine backsourcing, which refers to the full or partial... more Purpose The purpose of this study is to examine backsourcing, which refers to the full or partial re-internalization of a firm’s previously outsourced activity. Researchers have primarily focused on the drivers of backsourcing, but this paper builds on that prior research to develop a typology of backsourcing. Design/methodology/approach Drawing on transaction cost economics and the resource-based view (RBV), the paper posits that firms backsource because of two factors – changes in their short-run total costs and changes in their internal capabilities for re-internalization. By using the interactions between these two factors, the authors propose four types of backsourcing. Findings The paper presents a typology for backsourcing: profitability-backsourcing, operational-backsourcing, strategic-backsourcing and failure-backsourcing. Only one (failure-backsourcing) of these four types of backsourcing suggests failure, while the other three indicate strategic flexibility. The authors a...
This paper examines how emerging economies (EE) overcome their latecomer disadvantages and catch ... more This paper examines how emerging economies (EE) overcome their latecomer disadvantages and catch up technologically with developed economies (DE). Specifically, we examine the nature of technologies that EE firms innovate in (namely emerging or mature technologies) and also investigate the role of governmental effort and firm activity in directing technology development. Data from 57 countries on patents filed with USPTO from 2000 to 2008 is used to test our hypotheses. We find that government R&D efforts are more likely to focus on mature technologies whereas R&D efforts by independent firms are more likely to focus on emerging technologies. We also find that firms are more likely to innovate in mature technologies, and that EE firms may have higher propensity to innovate in mature technologies than DE firms.
We examine the impact of a stronger intellectual property rights (IPR) regime through the adoptio... more We examine the impact of a stronger intellectual property rights (IPR) regime through the adoption of Trade- Related Aspects of Intellectual Property Rights (TRIPS) on innovation by Indian firms in the bio- pharmaceutical industry. We find that differences in the IPR regime at the time a firm was founded led to subsequent differences in firms’ propensity to innovate and their nature of innovations. Building on institutional change theory, we argue that firms created under the pre-TRIPS regime, which we refer to as de alio firms, have a lower propensity to innovate and have a focus on process innovations. De novo firms, which are firms created under TRIPS, have a greater propensity to innovate and have a focus on product innovations. Further, we study how international technology alliances have helped Indian bio-pharmaceutical firms to overcome their limitations arising due to institutional imprints and to improve their innovation capabilities. Data on 164 Indian bio- pharmaceutical firms from 1995 to 2018 is used to empirically test our hypotheses.
PurposeWhile the phenomenon of R&D offshoring has become increasingly popular, scholars have most... more PurposeWhile the phenomenon of R&D offshoring has become increasingly popular, scholars have mostly focused on R&D offshore outsourcing from the point of view of the client firms, who are often from an advanced country. By examining vendor firms, in this paper the authors shift the focus to the second party in the dyadic relationship of R&D offshore outsourcing. Specifically, the authors compare vendor firms with nonvendor firms from the same emerging economy and industry to look at whether vendor firms from emerging economies can improve their innovation performance by learning from their clients. The authors also look at the role of depth and breadth of existing technological capabilities of the vendor firm in its ability to improve its innovation performance.Design/methodology/approachThis study is based on firm-level data from the Indian biopharmaceutical industry between 2005 and 2016. The authors use the Heckman two-stage model to control for self-selection by firms. The autho...
We examine the impact of a stronger intellectual property rights (IPR) regime through the adoptio... more We examine the impact of a stronger intellectual property rights (IPR) regime through the adoption of Trade- Related Aspects of Intellectual Property Rights (TRIPS) on innovation by Indian firms in the bio- pharmaceutical industry. We find that differences in the IPR regime at the time a firm was founded led to subsequent differences in firms’ propensity to innovate and their nature of innovations. Building on institutional change theory, we argue that firms created under the pre-TRIPS regime, which we refer to as de alio firms, have a lower propensity to innovate and have a focus on process innovations. De novo firms, which are firms created under TRIPS, have a greater propensity to innovate and have a focus on product innovations. Further, we study how international technology alliances have helped Indian bio-pharmaceutical firms to overcome their limitations arising due to institutional imprints and to improve their innovation capabilities. Data on 164 Indian bio- pharmaceutical firms from 1995 to 2018 is used to empirically test our hypotheses.
Research on emerging market firms (EMFs) has acknowledged the role of innovation in catchingup wi... more Research on emerging market firms (EMFs) has acknowledged the role of innovation in catchingup with advanced economies. Although we know that EMFs' innovation increasingly depends on collaborations and cross-border knowledge flows, less has been said about the effectiveness of foreign and domestic knowledge mechanisms adopted to improve EMFs' innovation performance. We hypothesize that foreign mechanisms rely on diverse knowledge and foster explorative innovation (i.e. innovation that extends the existing local competencies), while domestic mechanisms are more likely to be associated with the exploitation of the local existing competencies. Additionally, we claim that the breadth of EMFs' absorptive capacity strengthens the impact of foreign knowledge mechanisms on explorative innovation, while depth increases the impact of domestic knowledge mechanisms on EMFs' exploitative innovation, thus highlighting that the interplay of knowledge resources internal and external to the firm involve different levels of recombination. Our empirical analyses conducted on a sample of 161 Indian bio-pharmaceutical firms observed from 1997 to 2018 confirm our hypotheses, thus contributing to the literature on EMFs' catching up via internationalization and innovation.
The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In... more The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In response to this popular phenomenon, scholars are examining many learning conduits used by these firms to improve their innovation performance. The various learning conduits used by these firms include technology licensing, government R&D support, university-firm linkages, business groups, government affiliation, outward FDI, international collaborations, inward FDI, outsourcing, exporting and importing. Building on a systematic review of 115 papers on this topic, we find this literature to be unstructured, with no organizing framework. To help researchers take stock and make advancements, we use configurational theorizing to develop a framework that helps understand when and why these emerging economy firms tend to use the different learning conduits. Specifically, we propose that the choice of learning conduits is often driven by two key factors: the relative level of institutional formality of the emerging economy and the relative level of traditional ownership advantages of these firms. Building on these two dimensions, we classify emerging economy firms into four configurations: social network focused firms, laggard firms, leader firms and cutting-edge firms. We generate new insights based on our framework and overview of the existing studies, identify gaps in the literature, and make recommendations about how to extend this growing stream of research.
The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In... more The past decade has seen a dramatic increase in innovation coming from emerging economy firms. In response to this popular phenomenon, scholars are examining many learning conduits used by these firms to improve their innovation performance. The various learning conduits used by these firms include technology licensing, government R&D support, university-firm linkages, business groups, government affiliation, outward FDI, international collaborations, inward FDI, outsourcing, exporting and importing. Building on a systematic review of 115 papers on this topic, we find this literature to be unstructured, with no organizing framework. To help researchers take stock and make advancements, we use configurational theorizing to develop a framework that helps understand when and why these emerging economy firms tend to use the different learning conduits. Specifically, we propose that the choice of learning conduits is often driven by two key factors: the relative level of institutional formality of the emerging economy and the relative level of traditional ownership advantages of these firms. Building on these two dimensions, we classify emerging economy firms into four configurations: social network focused firms, laggard firms, leader firms and cutting-edge firms. We generate new insights based on our framework and overview of the existing studies, identify gaps in the literature, and make recommendations about how to extend this growing stream of research.
This paper examines the antecedents and performance outcomes of sourcing portfolio diversity in f... more This paper examines the antecedents and performance outcomes of sourcing portfolio diversity in firms' new product development (NPD). Sourcing portfolio diversity measures the degree to which a firm uses multiple sourcing choices along both organizational and geographic dimensions including domestic in-house sourcing, domestic outsourcing, captive offshoring, and offshore outsourcing. We extend transaction cost economics (TCE) to the portfolio level of analysis and predict that sourcing portfolio diversity in NPD is driven by heterogeneity in two transactional characteristics-technological application diversity, reflecting asset specificity, and variance in project-stage uncertainty. We also argue that the positive effect of sourcing portfolio diversity on firms' financial performance is driven by aligning sourcing portfolio configuration with the sources of transactional heterogeneity, increased strategic agility, and complementarities between individual sourcing choices. Our empirical study of NPD in the bio-pharmaceutical industry confirms our predictions. We contribute to research on sourcing and NPD by conceptually building and empirically establishing relevance of the sourcing diversity at the portfolio level of analysis and bringing the question of sourcing strategy to the forefront of NPD portfolio management concerns.
This paper examines the antecedents and performance outcomes of sourcing portfolio diversity in f... more This paper examines the antecedents and performance outcomes of sourcing portfolio diversity in firms' new product development (NPD). Sourcing portfolio diversity measures the degree to which a firm uses multiple sourcing choices along both organizational and geographic dimensions including domestic in-house sourcing, domestic outsourcing, captive offshoring, and offshore outsourcing. We extend transaction cost economics (TCE) to the portfolio level of analysis and predict that sourcing portfolio diversity in NPD is driven by heterogeneity in two transactional characteristics-technological application diversity, reflecting asset specificity, and variance in project-stage uncertainty. We also argue that the positive effect of sourcing portfolio diversity on firms' financial performance is driven by aligning sourcing portfolio configuration with the sources of transactional heterogeneity, increased strategic agility, and complementarities between individual sourcing choices. Our empirical study of NPD in the bio-pharmaceutical industry confirms our predictions. We contribute to research on sourcing and NPD by conceptually building and empirically establishing relevance of the sourcing diversity at the portfolio level of analysis and bringing the question of sourcing strategy to the forefront of NPD portfolio management concerns.
Purpose The purpose of this paper is to study the differences in the internationalization process... more Purpose The purpose of this paper is to study the differences in the internationalization process of firms from emerging economies and the impact of their international expansion related choices on the nature of technological innovations developed by these firms. Specifically, the authors compare two principal perspectives on internationalization – the incremental internationalization process (slow, gradually increasing commitments using greenfield investments to similar host countries) and the springboard perspective (aggressive, rapidly increasing commitments using mergers and acquisitions to advanced host countries). Design/methodology/approach Building on key differences between the incremental internationalization and springboard perspectives, the authors argue that differences in the speed and mode of entry, as well as the interaction between the mode of entry and location of internationalization, will lead to differences in the types of technologies (mature versus novel) deve...
Abstract Given the complexity of sourcing choices in R&D, driven by conflicting points of dif... more Abstract Given the complexity of sourcing choices in R&D, driven by conflicting points of difference, scholars have struggled to formulate clear theoretical predictions about which sourcing choices lead to superior performance. Our study contributes to the elucidation of this question by studying both the antecedents and performance consequences (project cost and duration) of alternative sourcing choices in the context of new product development, thus bridging two rarely intersecting streams of research to discover unique insights. We draw from the transaction cost economics (TCE) and organizational learning theory to account for the interdependence of cost- and non-cost related factors in firms’ sourcing choices. Results from our empirical analysis, using data on clinical trials in the global biopharmaceutical industry, show that greater project complexity, project stage uncertainty, and prior sourcing experience determine the sourcing choices a firm makes. We also establish that alternative sourcing choices vary in their ability to minimize project cost versus project duration, and show that prior experience with a sourcing choice is an important moderator of project performance, in addition to being one of the determinants of sourcing choice.
Journal of Global Operations and Strategic Sourcing, 2019
Purpose The purpose of this study is to examine backsourcing, which refers to the full or partial... more Purpose The purpose of this study is to examine backsourcing, which refers to the full or partial re-internalization of a firm’s previously outsourced activity. Researchers have primarily focused on the drivers of backsourcing, but this paper builds on that prior research to develop a typology of backsourcing. Design/methodology/approach Drawing on transaction cost economics and the resource-based view (RBV), the paper posits that firms backsource because of two factors – changes in their short-run total costs and changes in their internal capabilities for re-internalization. By using the interactions between these two factors, the authors propose four types of backsourcing. Findings The paper presents a typology for backsourcing: profitability-backsourcing, operational-backsourcing, strategic-backsourcing and failure-backsourcing. Only one (failure-backsourcing) of these four types of backsourcing suggests failure, while the other three indicate strategic flexibility. The authors a...
This paper examines how emerging economies (EE) overcome their latecomer disadvantages and catch ... more This paper examines how emerging economies (EE) overcome their latecomer disadvantages and catch up technologically with developed economies (DE). Specifically, we examine the nature of technologies that EE firms innovate in (namely emerging or mature technologies) and also investigate the role of governmental effort and firm activity in directing technology development. Data from 57 countries on patents filed with USPTO from 2000 to 2008 is used to test our hypotheses. We find that government R&D efforts are more likely to focus on mature technologies whereas R&D efforts by independent firms are more likely to focus on emerging technologies. We also find that firms are more likely to innovate in mature technologies, and that EE firms may have higher propensity to innovate in mature technologies than DE firms.
We examine the impact of a stronger intellectual property rights (IPR) regime through the adoptio... more We examine the impact of a stronger intellectual property rights (IPR) regime through the adoption of Trade- Related Aspects of Intellectual Property Rights (TRIPS) on innovation by Indian firms in the bio- pharmaceutical industry. We find that differences in the IPR regime at the time a firm was founded led to subsequent differences in firms’ propensity to innovate and their nature of innovations. Building on institutional change theory, we argue that firms created under the pre-TRIPS regime, which we refer to as de alio firms, have a lower propensity to innovate and have a focus on process innovations. De novo firms, which are firms created under TRIPS, have a greater propensity to innovate and have a focus on product innovations. Further, we study how international technology alliances have helped Indian bio-pharmaceutical firms to overcome their limitations arising due to institutional imprints and to improve their innovation capabilities. Data on 164 Indian bio- pharmaceutical firms from 1995 to 2018 is used to empirically test our hypotheses.
PurposeWhile the phenomenon of R&D offshoring has become increasingly popular, scholars have most... more PurposeWhile the phenomenon of R&D offshoring has become increasingly popular, scholars have mostly focused on R&D offshore outsourcing from the point of view of the client firms, who are often from an advanced country. By examining vendor firms, in this paper the authors shift the focus to the second party in the dyadic relationship of R&D offshore outsourcing. Specifically, the authors compare vendor firms with nonvendor firms from the same emerging economy and industry to look at whether vendor firms from emerging economies can improve their innovation performance by learning from their clients. The authors also look at the role of depth and breadth of existing technological capabilities of the vendor firm in its ability to improve its innovation performance.Design/methodology/approachThis study is based on firm-level data from the Indian biopharmaceutical industry between 2005 and 2016. The authors use the Heckman two-stage model to control for self-selection by firms. The autho...
We examine the impact of a stronger intellectual property rights (IPR) regime through the adoptio... more We examine the impact of a stronger intellectual property rights (IPR) regime through the adoption of Trade- Related Aspects of Intellectual Property Rights (TRIPS) on innovation by Indian firms in the bio- pharmaceutical industry. We find that differences in the IPR regime at the time a firm was founded led to subsequent differences in firms’ propensity to innovate and their nature of innovations. Building on institutional change theory, we argue that firms created under the pre-TRIPS regime, which we refer to as de alio firms, have a lower propensity to innovate and have a focus on process innovations. De novo firms, which are firms created under TRIPS, have a greater propensity to innovate and have a focus on product innovations. Further, we study how international technology alliances have helped Indian bio-pharmaceutical firms to overcome their limitations arising due to institutional imprints and to improve their innovation capabilities. Data on 164 Indian bio- pharmaceutical firms from 1995 to 2018 is used to empirically test our hypotheses.
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Papers by Pooja Thakur-Wernz