Inter firm relationships and safe nests
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This document discusses the concept of 'safe nests' within global networks in the context of R&D in the wireless telecom industry, highlighting the paradox of homebound inventive activities despite globalization. It emphasizes factors such as organizational inertia, accumulated knowledge, and centralized IP management that contribute to the persistence of these safe nests. The authors aim to explore the uneven distribution of appropriability and the significance of interfirm relationships in driving innovation.
Inter firm relationships and safe nests
- 1. Interfirm Relationships and Appropriability Safe Nests in Global Nets Alberto Di Minin Di Minin, A., & Bianchi, M. 2011. Safe Nests in Global Nets: Internalization and Appropriability of R&D in Wireless Telecom. Journal of International Business Studies, 42(7): 910-934. (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing Innovation 1 within and between firms
- 2. We claim to be students of innovation APPROPRIABILITY USER-LED INNOVATION (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing Innovation within and between firms
- 3. Removing a “safe” assumption Appropriability is evenly distributed across the corporate network (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 3 Innovation within and between firms
- 4. My Starting Point: Patel and Pavitt The case of R&D Non Globalization “We expect to see greater internationalization of large firms‟ technological activities in the future…” Patel, P & Pavitt, P. 1991 (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 4 Innovation within and between firms
- 5. Research Question 20 years after Can we find evidence of “Non Globalization”? (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 5 Innovation within and between firms
- 6. Wireless Telecom as an interesting case: all signs of globalization… Demand factors • Deregulation and break-up of national monopolies, new regional markets with local players demand and tastes Supply factors • Technological convergence, emerging/new „centers of excellence‟ (Eastern Europe, China, India etc.), supply of both high skilled and low cost engineers Intermediating factors • Interoperability and modularization, integration of technologies developed worldwide… (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 6 Innovation within and between firms
- 7. …but also an interesting area for Collaboration and Open Innovation practices! • Standardization of wireless communication • ETSI system of notification of patents as an analytical lens to single out „more significant‟ inventive activity • The 4 largest assignees of ETSI “essential” patents: – Ericsson, Qualcomm, Motorola, Nokia: 64% of all essential patents USPTO (US) Patents Assigned to the 4 Companies* SAMPLE (ES): CONTROL 537 USPTO GROUP (CG): PATENTS 1420 USPTO Int. Prot. PATENTS Patents in the same technology Essential classes Patents * For US companies solely US patent families excluded from analysis (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 7 Innovation within and between firms
- 8. Types of ETSI Standards mainly covered by the empirical analysis DVB V5 Interface DECT GSM GPRS UMTS GSM/AMR-NB 3GPP/AMR-WB TETRA 1980 1990 2000 (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 8 Innovation within and between firms
- 9. Distribution of Patents (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 9 Innovation within and between firms
- 10. The main result (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 10 Innovation within and between firms
- 11. Inferential Analysis Patel & Pavitt (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 11 Innovation within and between firms
- 12. Findings so far • The Patel Pavitt paradox remains! – In a very globalized industry we still see strongly homebound inventive activities once „R&D‟ is dissected by economic/technological/strategic content – Concentration in the headquarters of the most strategic R&D • Why is this happening? (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 12 Innovation within and between firms
- 13. Why R&D does not decentralize so easily? Insights from the company interviews • Centres of Excellence argument • In-house R&D (DO patents) still remains important due to „intrafirm intermediating factors‟: – Accumulated „sticky‟ knowledge at HQ, organizational inertia – Maturation effect and steep learning curves in R&D internationalization – Importance of centralized IP management in this particular industry (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 13 Innovation within and between firms
- 14. Islands of Appropriability argument “An academic paper gets published and cited not only because of its scientific contribution, but also because of its effective structure and communication style. The same details are also relevant when drafting a patent, and are typically the responsibility of IP experts. The closer you are with the people who end up using and enforcing your patent, the more valuable for the company this patent is likely to be.” (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 14 Innovation within and between firms
- 15. Islands of Appropriability Maturation of R&D Subsidiary DEVELOPMENT OF LOCAL R&D AND IP LOCAL EXPERTISE MANAGEMENT PLUG INTO THE GLOBAL NETWORK Centers of Excellence Appropriable Intrafirm Knowledge Safe Nests Relationships Mgmt. IP Mgmt. R&D Mgmt. (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 15 Innovation within and between firms
- 16. So what do we seek to find in a Safe Nest? • R&D laboratories that offer a desirable setting for a high level of exploitation of research results • Premier locations for the development of the more influential technologies • The unequal distribution of appropriability across a firm’s R&D network is at the base of the formation and reinforcement of safe nests • Appropriability peaks because the level of coordination between inventors and IP managers is the highest (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 16 Innovation within and between firms
- 17. Expectations about Safe Nests • This central role is likely to endure, and it contributes to organizational inertia, shaping interfirm relationship and path dependence for technological development 1. they are the sites where focal research streams were initiated (knowledge stickiness). 2. they have moved further along the R&D learning curve with respect to R&D subsidiaries. 3. Location: not a monolithic concept. Yes the HQ, but not necessarily (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 17 Innovation within and between firms
- 18. Special issue on Co-Edited Alberto + Dries California Management Review “IP Management: in search of new practices, strategies and business models” Supported by the European Patent Office …To be continued 31.10.2012 18
- 19. Seeking for more evidence of Safe Nests (C) 2012 Alberto Di Minin - Universiteit Groningen Workshop Organizing 19 Innovation within and between firms
- 20. Di Minin, A., & Bianchi, M. 2011. Safe Nests in Global Nets: Internalization and Appropriability of R&D in Wireless Telecom. Journal of International Business Studies, 42(7): 910-934. alberto@sssup.it www.diminin.it DANK U WEL 31.10.2012 20