Author(s):
1. Szabolcs Szilard Sebrek, University of Pannonia, 2. Betsabe Perez Garrido, University of Pannonia, Hungary

Abstract:
The ability to compete in high-technology industries depends on the acquisition of competitive knowledge, implying, that a firm has to attain experience with the underlying science and related technological fields (Kim and Kogut, 1996). Some of these newly acquired capabilities serve the firm to respond rapidly to market changes and allow for expansion during windows of opportunity (Kim and Kogut, 1996). Studying patenting activity in optical disc technology, Rosenkopf and Nerkar (2001) show that exploration spanning organizational boundaries consistently generates higher impact on subsequent technological evolution, thereby it can provide for the explorer organization a competitive advantage within the industry. To maintain or enhance competitive edge, firms might be motivated to employ external technology search for search of new capabilities, and presumably to recombine those newly acquired or accessed capabilities with existing skills. This motive has been termed technology or knowledge seeking, and such organizational search behavior may be more prevalent if a firm competes in a technology intensive industry (Chung and Alcácer, 2002). For the purpose of our enquiry we expect some firms to value locations’ traits that reflect the level of localized technical activity. Tapping localized technology source is greatly enhanced by frequent inter-partner interaction as relevant knowledge can be tacit and the prerequisite of its transfer depends on physical propinquity (Kogut and Zander, 1992). This idea that firms seeking new knowledge have to approach the target locations is reaffirmed by Almeida and Kogut (1999). They demonstrate that localized knowledge builds upon cumulative ideas within regional boundaries, and as knowledge is frequently tacit that knowledge resides with engineers of a particular geographic community. Air Products and Chemicals seeks ideas outside of its organizational boundaries as a central aspect of its business strategy (Rigby and Zook, 2002). The geographically widespread search for external R&D labor provides access for untapped expertise and extends greatly its capacity for innovation. In addition, these external technology links “save the company hundreds of thousands of dollars in net research costs” while generating abundant profit. External technology search has primary importance at Procter & Gamble, too (Sakkab, 2002). The firm pursues a “connect and develop” strategy to enrich its innovation portfolio with tools that embrace joint technology development, licensing of intellectual property, and tapping government and university sources, among others. In this paper we argue that pursuing the strategy of external technology search is relevant endeavor for firms which compete in high-technology industries. We propose that such a strategy can manifest in both the breadth and depth of external links (Laursen and Salter, 2006). Further, external technology cooperation with other actors from the same or related industries and acquistions are relevant channels to acquire external knowledge. To accomplish these objectives we turn to the databases. The first one encompasses industry participants from the high-technology security software industry (Giarratana, 2004; Fosfuri and Giarratana 2007). Furthermore, to triangulate our findings we also analyze company data using the PITEC innovation database that incorporate company information of Spanish firms (Barge, 2010).

Key words:
external technology search, high-technology industries, strategic alliances, intellectual property rights

Date of abstract submission:
20.11.2013.

Conference:
REDETE 2014 - Researching Economic Development and Entrepreneurship in Transition Economies