Knowledge processes within technology-based strategic alliances

Now, more than ever before, firms experience a strong need to expand their organizational boundaries, accessing the resources and knowledge of other firms in order to enhance their internal innovation performance

Situated at the core of such outward-looking strategies are strategic alliances: (in)formal collaborative arrangements between two or more organizations in which resources and capabilities are pooled together in order to achieve particular (mutual) objectives. Especially the number of technology-based alliances, i.e. alliances focused on developing new technologies or improving upon existing technologies, has grown rapidly in recent years. Technology-based alliances, however, do not always yield clear benefits to the firms involved. In some cases, the firm may fail to realize synergies with its partners, due to a mismatch in resources and capabilities. Even worse, in other cases, the firm’s valuable knowledge may unintendedly spill over to competitors via the alliance network. Thus, we identified a clear need to study the conditions under which technology-based alliances trigger, or actually hinder, firms’ innovation performance and knowledge processes.

Specifically, we have initiated a research trajectory in which we analyse comprehensive hand-collected data on technology-based alliances of firms in the hydrogen and fuel cells industry, spanning over 30 years of data. In this industry, firms possess highly heterogeneous (and often specialized) resource and technology profiles, implying that they typically do not have all the resources available internally to sustain their internal innovation performance. For instance, some of the largest automotive firms in the world, such as Honda, Renault, and General Motors, have formed strategic alliances with key materials and component suppliers (such as 3M) and dedicated fuel cell producers (such as Ballard Power Systems) in order to improve the design and performance of their fuel cell-powered automotive vehicles. It is within this interesting setting that we study various knowledge processes within technology-based alliances.

Current research

Merging the alliance data with comprehensive firm-level patent data, we are currently working on two core research inquiries within this broad theme. In the first project, we examine how the characteristics of the alliance partners’ knowledge elements (i.e. the ‘pieces’ of knowledge that are used to build new innovations, such as knowledge of hydrogen storage) influence the ability of a firm to access and benefit from this knowledge. We are specifically looking into the different ways in which these knowledge elements were previously combined by an alliance partner, arguing that this might influence their level of retrievability. We have already published an article on a similar topic in the Journal of Management, which can be freely accessed here.

In the second project, we study under what conditions the knowledge held by a focal firm is more or less likely to flow to different partners in the alliance network. We argue, for instance, that when a firm’s direct alliance network is ‘older’ (i.e. ongoing partnerships were initiated a long time ago) and, thus, partners have developed strong relational resources (e.g. trust), knowledge is less likely to flow beyond the direct network to indirect partners. These two projects yield important insights that can be used by practitioners to improve the inner workings and design of individual technology-based alliances but also alliance networks as a whole.

THE RESEARCHERS

Holmer Kok is Assistant Professor at the Department of Entrepreneurship, Innovation, and Technology at the Stockholm School of Economics. He has completed his PhD at the University of Groningen on the topic of knowledge recombination in the fuel cell industry, under supervision of Prof. dr. Dries Faems and Dr. Pedro de Faria. His research examines factors underlying the creation of valuable new technologies. Next to this, he studies the performance implications of various extramural knowledge sourcing strategies, such as strategic alliances and mergers and acquisitions. His research is forthcoming in the Journal of Management and has been presented at numerous international conferences such as the Annual Meeting of the Academy of Management, Strategic Management Society Conference, and DRUID.

Dries Faems holds the Chair of Entrepreneurship, Innovation and Technological Transformation at WHU – Otto Beisheim School of Management. He also is a Visiting Professor at the LUISS Business School in Rome. His current research focuses on collaboration for innovation. In particular, he studies how alliance activities influence firms´ innovation and financial performance and how firms can effectively manage different types of open innovation strategies. He has published papers in journals such as Academy of Management Journal, Strategic Management Journal, Journal of Management, Journal of Management Studies, Research Policy, Organization Studies, and Journal of Product Innovation Management. Previously, he was General Editor at the Journal of Management Studies (2014-2018).

Pedro de Faria is Associate Professor in Innovation Management at the Department of Innovation Management and Strategy of the University of Groningen. Pedro's research focuses on topics in innovation management and strategic human capital. He is particularly interested in understanding how firms define their cooperation and knowledge protection strategies and how human capital plays a role in internationalization strategies. Pedro's research has appeared in leading journals such as the Journal of Management, Journal of International Business Studies and Research Policy. He is currently Associate editor of the journal Industry and Innovation.