From Licensing to Innovation: Alternative Ways of Capability Building at Firms in Emerging Economies
2013 (English)In: R&D Management Conference's Proceeding, 2013Conference paper (Refereed)
Studies of the rapid economic development in East Asia have generated several models how industries in latecomer economies may upgrade from low-end manufacturing to full-blown product development capabilities. With the exception of some Korea and Taiwan’s firms, however, there are few studies of the innovation journey of specific firms and the challenges, managerial efforts and uncertainties involved in linking to and learning from international knowledge centers. Moreover, the alternative ways suggested in the literature to acquire knowledge for innovation, need to be analyzed and compared from a firm and management perspective.
This paper analyzes the strategic options confronting emerging economy firms which aspire to succeed in global competition. Using in-depth studies of two company cases in Turkey, one in white goods and one in the automotive industry, the paper details the combination of efforts and investments required to move up the technology ladder from license-based domestic businesses to independent, internationally competitive capabilities on par with global innovation leaders. The paper shows the critical value of long-term ownership structures for independent capability building but also indicates the difficulty of building brand value commensurate with technological achievements. Further, the paper demonstrates the limits of the alternative way, joint venture agreements, where MNEs tend to retain exclusive control of key technologies and product decisions. Here the paper suggests that coordinated private and Government efforts might be needed to position local partner firms as global centers of “niche” excellence within the multinational configuration.
Place, publisher, year, edition, pages
R&D management, capability building, joint ventures, innovation, emerging economies, white goods, automotive industry
IdentifiersURN: urn:nbn:se:liu:diva-106470ISBN: 978-0-9559367-5-3OAI: oai:DiVA.org:liu-106470DiVA: diva2:716135
R&D Management Conferences, 26-28 June 2013, Manchester, UK