Technological Alliances and Innovative Performance in the Aerospace and Defense Industry

• Author: Giovanni Satta,Salvatore Esposito De Falco,Lara Penco,Francesco Parola
• Date: 01 July 2015
• DOI: http://doi.org/10.1002/jsc.2013
• Published date: 01 July 2015

RESEARCH ARTICLE

Strat. Change 24: 321–337 (2015)

Published online in Wiley Online Library

(wileyonlinelibrary.com) DOI: 10.1002/jsc.2013

Copyright © 2015 John Wiley & Sons, Ltd.

Strategic Change: Briengs in Entrepreneurial Finance

Strategic Change

DOI: 10.1002/jsc.2013

Technological Alliances and Innovative Performance

in the Aerospace and Defense Industry1

Giovanni Satta

University of Genoa, Italy

Salvatore Esposito De Falco

University of Rome ‘La Sapienza,’ Italy

Lara Penco

University of Genoa, Italy

Francesco Parola

University of Naples ‘Parthenope,’ Italy

Technological alliances, giving access to information and know-how held by

partners, foster and boost a firm’s innovative performance in high-tech industries.

Technology, innovation, and time to market become key success factors in high-tech

industries, where ‘technological convergence’ (i.e., the process by which diverse

industries come to share similar technological bases; Rosenberg, 1976) imposes the

sharing and exchange of knowledge and resources (Bozeman et al., 2007). is sheds

light on the emerging relevance of cooperation, alliances, networks, communities,

and other inter-rm ties in a rm’s innovation activities (Baum et al., 2000). In

particular, strategic alliances (i.e., cooperative inter-rm agreements for achieving

durable competitive advantage; Das and Teng, 2000) represent a viable option for

inter-rm collaboration in high-tech industries, as strategic alliances appear posi-

tively associated with rms’ dynamic capabilities and innovative performance (Doz

and Hamel, 1998; Eisenhardt and Martin, 2000; Lhuillery and Pster, 2009).

Indeed, the environmental uncertainty and speedy technological breakthroughs

characterizing high-tech industries demand rapid learning, organizational exibil-

ity, and rms’ strategic reactivity. erefore, rms operating in highly competitive

environments increasingly resort to strategic alliances as they enhance knowledge

sharing between partners (Mowery et al., 1996), allow innovative performance

(Schilling and Phelps, 2007), ensure organizational exibility (Doz and Hamel,

1998; Hagedoorn and Duysters, 2002), share costs, and moderate risks related to

1 JEL classication codes: D74, L14, L24, O32.

Through technological

supplementary alliances, high-

tech firms reach unexpected

synergies in innovation activities

and rationalize innovation

processes.

Technological complementary

alliances may allow firms to

overlap the possible lock-in

effects which characterize

supplementary alliances and

encourage partners to break with

existing rules, norms, and routine.

In high-tech and science-based

industries, where breakthrough

innovations impose a combination

of generic or basic knowledge and

science with applied research,

cooperative agreements with

universities emerge as an ideal

source of specialist knowledge.

Innovation requires new

approaches to problem resolution,

and an original recombination of

technologies and resources.

322 Giovanni Satta, Salvatore Esposito De Falco, Lara Penco, and Francesco Parola

Copyright © 2015 John Wiley & Sons, Ltd. Strategic Change

DOI: 10.1002/jsc

contracts, joint R&D, etc. – giving access to information

and know-how held by partners have been proven to

foster and boost a rm’s innovative performance, mea-

sured both in terms of new patent application and product

development (Baum et al., 2000; Schilling and Phelps,

2007). By combining internal and external knowledge

and resources, technological alliances allow rms to

complement endogenous capabilities (Hagedoorn and

Duysters, 2002), as well as enhancing the creation of new

knowledge and innovative skills (Teece et al., 1997; Owen-

Smith and Powell, 2004).

In recent years management scholars and practitioners

have largely been interested in technological alliances in

high-tech industries. Several theoretical perspectives have

been proposed and applied to technological alliances,

including, among others, transaction cost economics

(Williamson, 2002), the Resource-Based View (RBV) and

the dynamic capabilities approach (Santangelo, 2000;

Lavie, 2007; Arranz and Fades de Arroyabe, 2008;

Wittmann et al., 2009), the knowledge-based view (Zhang

et al., 2007), the relational factors approach (Mehta et al.,

2006), network theory (Ozman, 2009), and the embed-

dedness perspective (Arya and Lin, 2007).

Indeed, the specic dimensions of technological alli-

ances which impact on innovation in high-tech industries

still remain under-explored by academics (Schilling and

Phelps, 2007), and a solid empirical base has to be pro-

vided (Hagedoorn and Duysters, 2002). In this regard, a

resource-based perspective, grounding on the role played

by unique resources and relationships in enhancing a

rm’s competitive advantage and innovative performance

(Rumelt, 1984), appears particularly appropriate. In fact,

in an RBV perspective the main rationale for technologi-

cal alliances is to generate value by accessing and retaining

knowledge, valuable resources, and capabilities which are

partially exogenous to a rm’s boundaries (Hagedoorn

and Duysters, 2002). Moreover, RBV contributions rec-

ognize the centrality of resource exchange and the value

of the resources accessed through strategic alliances

(Saxton, 1997), emphasizing the resource-based

highly uncertain research and development (R&D) proj-

ects (Grant and Baden-Fuller, 2004; Jiang et al., 2010).

e extant literature, in particular, has recognized the

predominant role of technological strategic alliances (i.e.,

inter-rm cooperative agreements implying joint innova-

tive activity and/or exchange of technology; Gulati et al.,

2000; Sampson, 2007) in fostering and boosting a rm’s

innovative performance, both in terms of new patent

application and product development (Baum et al., 2000;

Hagedoorn and Duysters, 2002). So far, a large proportion

of the literature on technological alliances and R&D coop-

eration has focused on why rms engage alliance (Das and

Teng, 2000; Grant and Baden-Fuller, 2004) and partner

selection criteria (Miotti and Sachwald, 2003; Arranz and

Fades de Arroyabe, 2008). On the contrary, the specic

dimensions of technological alliances which impact on

innovation still remain under-explored (Belderbos et al.,

2004; Schilling and Phelps, 2007). Moreover, as previous

contributions are basically qualitative in nature, a solid

empirical base has to be provided for deeper investigation

of the impact on rm innovation of the resources exchanged

within the alliance and the technological alliance portfolio

characteristics. In this regard a resource-based perspective,

grounded on the role played by unique resources and inter-

rm ties in enhancing a rm’s competitive advantage and

innovative performance (Rumelt, 1984), appears particu-

larly appropriate.

e present contribution, by addressing the aerospace

and defense industry (i.e., one of the most competitive

and knowledge-intensive sectors among high-tech indus-

tries), aims to empirically investigate the impact on a

rm’s innovative performance (measured as propensity to

patent) of the resources shared and the technological alli-

ance portfolio characteristics.

Technological alliances and innovative performance

in high-tech industries: Conceptual framework

Technological alliances – for example, transfer of property

rights (‘technology for cash’), licensing agreements, R&D