به سوی سیستم باز R & D : سرمایه گذاری داخلی R & D، کسب دانش خارجی و عملکرد نوآورانه

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.

Over the past years firms have increasingly relied on external sources of knowledge in their R&D processes to develop and profit from innovations (Calantone and Stanko, 2007 and Linder et al., 2003). The conventional paradigm of having organizational core R&D activities exclusively in-house is becoming less critical, while more recent models of innovation suggest how firms are ‘opening’ up their R&D borders to tap into external sources of knowledge (Chesbrough, 2003). Tapping into external technology sourcing alleviates some of the challenges firms face such as shorter product life cycles, faster product renewal and increasing R&D costs (Rigby and Zook, 2002). On the other hand, searching for and coordinating an increasing number of new collaborations are activities that require greater investments in time and money. Consequently, higher transaction costs may erode the benefits of new external R&D activities. As firms start to systematically open up their R&D borders, they adapt and fine-tune their R&D configuration – their internal and external R&D processes – to build new or reinforce existing relationships with a diverse range of partners. Given the importance of R&D processes, the difficult task for managers is to find a balance between internal and external R&D activities in order to capture the benefit from external technology sources. This paper addresses this issue by investigating how the trade-off between internal and external R&D processes influences a firm's innovative performance. In particular, it focuses on how a firm's internal R&D capacity – internal R&D investment in building stock of knowledge – moderates the relationship between a firm's R&D structure and its innovative performance. Prior research suggests firms can tap more efficiently into external sources of knowledge by investing in own R&D. Firms that invest in building an internal R&D stock of knowledge are better able to recognize and evaluate external sources and in turn to integrate and use their knowledge (Cohen and Levinthal, 1990). Moreover, they often rely on fewer yet more valuable linkages to achieve greater innovative output (Arora and Gambardella, 1994). Since selection and assimilation of external knowledge depend on a firm's stock of knowledge (Cohen and Levinthal, 1990), it is relevant to know how internal R&D capacity influences the relationship between the degree of R&D outsourcing and innovation performance. By investigating the moderating role of R&D capacity in balancing internal and external R&D activities, this paper explores the conditions in which the open innovation paradigm matters for greater innovative performance. By doing so, it contributes to the literature in two ways. First, by building on a study by Cassiman and Veugelers (2006), this paper tests the extent to which internal and external R&D activities are complementary or substitute for greater innovative performance. Whereas Cassiman and Veugelers (2006) investigate how each of the distinctive R&D structures (Make, Buy and Make & Buy) influences innovation performance (using essentially three models with three dichotomous variables), this paper focuses on the degree of R&D outsourcing. By using a continuous approach to the Cassiman and Veugelers’ typology, this paper provides a better understanding of the benefits and drawbacks in opening up a firm's R&D borders and in trading off internal and external R&D activities. Second, prior research has emphasized the moderating role of internal R&D investment in capturing unintentional external knowledge flows (Escribano et al., 2009) to achieve better innovative output, but has not taken into account how such firm's R&D capacity influences the knowledge flow through external R&D activities. By examining the moderating role of R&D capacity in this context, this paper provides new insights in the ability of firms to capture value by balancing internal and external R&D activities. More critically, it provides a contextual variable that allows us to better assess the complementarity vs substitution dichotomy. To address these issues empirically, this paper investigates the internal and external R&D configuration of R&D-intensive Italian manufacturing firms. Based on two survey waves, I find that firms with an internal and external R&D system have greater innovative performance. Yet those firms that carry out more external than internal R&D activities perform worse. Moreover, I find that R&D capacity significantly moderates this curvilinear relationship. Firms with greater R&D capacity are able to benefit more from their external R&D activities in terms of innovative output. And they are able to do so by utilizing a smaller share of external R&D activities than those firms with a lower R&D capacity. These findings provide a deeper understanding of the relationship between internal and external R&D that goes beyond the classic opposition between complementarity and substitution. They imply that internal and external R&D activities are complementary up to a point after which they are substitute. More critically, the substitution effect is larger for firms with greater R&D capacity. Overall, these results provide a better understanding of the open innovation paradigm by suggesting that the opportunity cost for further opening up R&D borders is greater for firms with greater internal R&D capacity. This paper is organized as follows. The next section examines the literature on R&D configuration, internal R&D capacity and innovation performance. It proposes a set of hypotheses that drives the analysis. The third section describes the database and the method. Finally, the results are elaborated and discussed.

Due to a fast-changing innovation environment, firms are increasingly turning their R&D labs into R&D open systems to be able to tap into external sources of knowledge. The effective organization of the R&D system is a crucial challenge for a firm's future innovative activities. To better understand how firms organize their R&D system with external knowledge partners, this study examines the influence of R&D configuration on innovative performance and the moderating role of a firm's R&D capacity. In summary, this paper contributes to our understanding of the effect of the trade-off between internal and external R&D processes on a firm's innovative performance. Firms that move the boundaries of their R&D configuration by engaging in external R&D activities need to balance the benefits from tapping into external sources and the costs of searching, coordinating and monitoring linkages. This paper highlights how a focal firm's technological capabilities and its internal stock of knowledge influence such a balance. Firms with a high level of R&D capacity are better able to capture and exploit external knowledge through R&D collaborations in terms of innovative output, by investing relatively less in external R&D activities than other firms. Overall, this study provides a test to the open innovation paradigm by exploring under which conditions greater R&D openness benefits innovative performance. The findings provide some managerial implication as well. This study indicates that the average external R&D percentage (23%) of Italian firms is below the average optimal percentage (34%) in relation to innovative performance (see Fig. 1). This suggests that managers of firms with relatively low external R&D could reap greater benefits in terms of innovative performance by increasing the percentage of their external R&D. They, however, need to take into account their own technological knowledge base and R&D capabilities to capture value from R&D collaborations in an effective manner. This study thoroughly examines the role of R&D configuration and R&D capacity on a firm's innovative performance, yet it faces some important limitations. First, the sample encompasses only two waves of Italian manufacturing firms. A greater longitudinal set could provide greater exploratory power. Second, the results could be generalized to industry systems that are similar to the Italian ones, where SMEs are predominant. Third, it focuses on the role of external R&D activities without investigating the characteristics of R&D partners. Examining the types of R&D partners and the linkages with the focal firm merits further inquiry. How, for example, do firms structure their external R&D activities? How diverse is their R&D collaboration portfolio? Finally how does R&D partnership diversity influence a focal firm's innovative performance? Future research could focus on the nature of R&D collaborations providing an even more thorough examination of the role of R&D system on a firm's performance.