The Positive Impact of Inter-Organizational Networking in Innovation in Biotechnology Industry: Comparative Case Analysis of Biotech Network One Nucleus

Published:

Authors

  • Vivek VermaSchool of Economics and International Business University of Greenwich, Park Row, London, United Kingdom
  • Vasilki T ZoumpaSchool of Economics and International Business University of Greenwich, Park Row, London, United Kingdom
Keywords
Inter-organizational networking, innovation, biotechnology industry, processual research, OECD, innovation output

Abstract

To further substantiate the role of inter-organizational networking in innovation, we explored the positive impact of large networks on innovation in the biotechnology industry. The research was conducted in two parts. In the first part, a qualitative research methodology using exploratory case study is performed on the three SME members of the UK-based biotech network One Nucleus. In the second part, a quantitative research approach using comparative empirical OECD data analysis is performed. The two research methodologies used are subsequently linked together thorough a unique research approach known as processual research. A new insight is explored regarding issues linked to inter-organizational networking, like the role of networks on organizational learning, the role of third party organizations within networks, diversity of partners and the nature of learning (localized vs. global) within biotech networks. The primary data is generated on the number of alliances, types of alliances and types of innovation, whereas innovation is measured as a dependent variable. Empirical results obtained clearly indicate that innovation output (patent approval rate, patent success rate) with respect to each alliance made by the sample firms is positively impacted by the parent biotech network One Nucleus.

References

Accenture and Babson College (2004) ‘The Drug Industry’s Aliance Archipelago’, (online) (cited 4 May 2010). Available from <URL:http://www.babsoninsight.com/contentmgr/showdetails.php/id/649>
Aharonson, B., Baum, J. and Feldman, M. (2004) ‘Industrial clustering and the returns to inventive activity: Canadian biotechnology firms 1991–2000’. DRUID (Danish Research Unit for Industrial Dynamics) Working Papers, nos. 04–03.
Allen, R. (1983) ‘Collective invention’, Journal of Economic Behaviour and Organization, 4:1, pp. 1–24.
Anne, L.J. and Wal, T. (2011) ‘The dynamics of the inventor network in german biotechnology: Geographical proximity versus triadic closure, Evolutionary Economic Geography, pp. 1102.
Arora, A. and Gambardella, A. (1990) ‘Complementary and external linkages: The strategies of the large firms in biotechnology’, Journal of Industrial Economics, 38:4, pp. 361–79. http://dx.doi.org/10.2307/2098345.
Arora, A. and Gambardella, A. (1994) ‘Evaluating technological information and utilizing it’, Journal of Economic Behaviour and Organization, 24:1, pp. 91–114.
Baker, A. (2003) ‘Biotechnology’s growth-innovation paradox and the new model forsuccess’, Journal of Commercial Biotechnology, 9:4 , pp. 286–88.
Baum, J.A., Calabrese, T. and Silverman, B. (2000) ‘Don’t go it alone: alliance network composition and startups’ performance in Canadian biotechnology’, Strategic Management Journal, 21:3, pp. 267–94. http://dx.doi.org/10.1002/(SICI)1097-0266(200003)21:3<267::AID-SMJ89>3.0.CO;2-8.
Beuzekom, B.V. and Arundel, A. (2009) ‘OECD Biotechnology Statistics 2009’ (online) (cited 18 June 2010). Available from <URL: http://www.oecd.org/dataoecd/4/23/42833898.pdf>
Butler,J.E. (1988) ‘Theories of technological innovation as useful toolsfor corporate strategy’, Strategic Management Journal, 9, pp. 15-29. http://dx.doi.org/10.1002/smj.4250090103.
Capello, R. (1999) ‘Spatial transfer of knowledge in high technology milieux: Learning versus collective learning processes’, Regional Studies. 33:4, pp. 352–65. http://dx.doi.org/10.1080/00343409950081211
Chin, J. (2004) ‘Biotechnology’s special forces: field based medical science liaisons’, Journal of Commercial Biotechnology, 10:4, pp. 12–18. http://dx.doi.org/10.1057/palgrave.jcb.3040088.
Clark, J. (1979) A Model of Embodied Technical Change and Employment, Sussex, UK: Science and Policy Research Unit, Sussex University.
Damanpour, F. and Gopoalakrishnan, S. (1999) ‘Organizational Adaptation and Innovation: The Dynamics of Adopting Innovation Types’, in Brockhoff, K., Chakrabarti, A. and Hauschild, J. (1st edn.) The Dynamics of Innovation, Berlin, Springer, pp. 57–80. http://dx.doi.org/10.1007/978-3-662-03988-5_3.
DeBresson, C. and Amesse, F. (1991) ‘Networks of innovators: A review and introduction to the issue’, Research Policy, 20:5, pp. 363–79. http;//dx.doi.org/10.1016/0048-7333(91)90063-V.
Dutta, S. and Weiss, A.M. (1997), ‘The relationship between a firm’s level of technological innovativeness and its pattern of partnership agreements’, Management Science, 43:3, pp. 343–56.
Ettlie, J.E. (1995) ‘Product-process development integration in manufacturing’, Management Science, 41:7, pp. 1224–1237. http;//dx.doi.org/10.1287/mnsc.41.7.1224.
Fox-Wolfgramm, S. J. (1997) ‘Towards developing a methodology for doing qualitative research: the dynamic- comparative case study method’, Scandinavian Journal of Management, 13:4, pp.439-455. http;//dx.doi.org/10.1016/S0956-5221(97)00028-6.
Edwards, T. (2000) ‘Innovation and organizational change: developments towards an interactive process perspective. Technology Analysis and Strategic Management, 12:4, pp. 445–65. http://dx.doi.org/10.1080/713698496.
Ettlie, J.E. (1995) ‘Product-process development integration in manufacturing’, Management Science, 41:7, pp 1224–1237.
Gans, J. and Stern, S. (2004) ‘Managing ideas: commercialization strategies for biotechnology’, (online) (cited 4 March 2010). Available from <URL:http://www.kellogg.northwestern.edu/academic/biotech/articles/managing_ideas.pdf>
Garcia, C.Q. and Velasco, C.A. (2005) ‘Agglomeration economies and vertical alliances: the route to product innovation in biotechnology firms’, International Journal of Production Research, 43:22, pp. 4853-4873.
George, G. Zahra, S.A. and Wood, D.R. (2002) ‘The Effects of Business-university Alliances on Innovative Output and Financial Performance: A Study of Publicly Traded Biotechnology Companies’, Journal of Business Venturing, 17, pp. 577–609. http://dx.doi.org/10.1016/S0883-9026(01)00069-6.
Glass, A.M.Wokaun, A. and Heritage, J.P. (1981) ‘Enhanced two-photon fluorescence of molecules adsorbed on silver particle films’, Phys. Rev. B, 24:8, pp. 4906–4909. http://dx.doi.org/10.1103/PhysRevB.24.4906.
Goerzen, A. and Beamish, P.W. (2005) ‘The effect of alliance network diversity on multinational enterprise performance’, Strategic Management Journal, 26:4, pp. 333–54. http://dx.doi.org/10.1002/smj.447.
Granovetter, M. (1998) ‘Coase revisited: Business groups in the modern economy’, in Dosi, G. Teece, D.J. and Chytry. J. (eds) New Technology, Organization and Competitiveness, York, Oxford University Press.
Gulati, R. (1995) ‘Social structure and alliance formation patterns’, Administrative Science Quarterly, 40:4, pp. 619–52. http://dx.doi.org/10.2307/2393756.
Gulati, R. and Higgins, M.C. (2003) ‘Which ties matter when? The contingent effects of inter-organizational partnerships on IPO success’, Strategic Management Journal, 24:2, pp.127–44. http://dx.doi.org/10.1002/smj.287.
Hagedoorn, J. (1993) ‘Understanding the rationale of strategic technology partnering: Interorganizational modes of cooperation and sectoral differences’, Strategic Management Journal, 14:5, pp. 371–85. http;//dx.doi.org/10.1002/smj.4250140505.
Hinings, C.R. (1997) ‘Reflections on processual research’, Scandinavian Journal of Management, 13:4, pp. 493–503. http;//dx.doi.org/10.1016/S0956-5221(97)00023-7.
Hirschler,B.(2007)‘Biotech revenuestop $70 bln asM&Apremiumssoar’,(online)(cited on 28 September 2010). Available from < URL:http://www.reuters.com/article/idUSL1534079120070415
Johnson, J.D., Donohue, W.A., Atkin, C.K. and Johnson, S. (2001) ‘Communications, involvement and perceived innovativeness: test of a model with two contrasting innovations’, Group and Organization Management, 26:1, pp. 24–52.
Kogut, B. (1988), ‘Joint ventures: Theoretical and empirical perspectives’, Strategic Management Journal, 9:4, pp. 319–32. http;//dx.doi.org/10.1002/smj.4250090403.
Kogut, B. (2000) ‘the network as knowledge: Generative rules and the emergence of structure’, Strategic Management Journal, 21:3, pp. 405–25. http://dx.doi.org/10.1002/(SICI)1097-0266(200003)21:3<405::AID-SMJ103>3.0.CO;2-5.
Langlois, R.N. (1989) ‘Economic change and the boundaries of the firm’, in Carlsson, B. (eds) Industrial Dynamics, Technological Organizational and Structural Changes in Industries and Firms, Boston, Kluwer, pp. 85–108.
Larson, A. (1992) ‘Network dyads in entrepreneurial settings: A study of the governance of exchange relationships’, Administrative Science Quarterly, 37:1, pp. 76–104. DOI:10.2307/2393534.
Lavie, D. and Rosenkopf, L. (2006) ‘Balancing exploration and exploitation in alliance formation’, The Academy of Management Journal, 49:4, pp. 797–818.
Lippitt, R.,Watson,J. andWestly, B. (1958) ‘The dynamics of planned change’. New York: Harcourt. http://dx.doi.org/10.1177/002076406000500417.
March, J. (1991) ‘Exploration and exploitation in organizational learning’, Organization Science, 2:1, pp. 71–87.
Meyer, M.H. and Mugge, P.C. (2001) ‘Make platform innovation drive enterprise growth’, Research Technology Management, 44:1, pp. 25–39.
Milling, P.M. & Stumpfe,J. (2000) ‘Product and process innovation a system dynamics based analysis of the interdependencies’, (online) (cited 26 September 2010). Available from <URL:http://www.systemdynamics.org/conferences/2000/PDFs/milling1.pdf>
Mohr, J.J. & Sengupta, S. (2002) ‘managing the paradox of inter firm learning: The role of governance mechanisms’. Journal of Business & Industrial Marketing, 17:4, pp. 282 -301.http://dx.doi.org/10.1108/08858620210431688.
Mowery, D.C., J.E. Oxley, and Silverman, B.S. (1998) ‘Technological overlap and interfirm cooperation: Implications for the resource based view of the firm’, Research Policy, 27:5, pp. 507–23. http://dx.doi.org/10.1016/S0048-7333(98)00066-3.
Nelson, A (2009) ‘Measuring Knowledge Spillovers: What patents, licenses and publications reveal about innovation diffusion’. Research Policy, 38:6, pp. 994-1005. http://dx.doi.org/10.1016/j.respol.2009.01.023.
Oliver, C. (1990) ‘Determinants of inter-organizational relationships: Integration and futuredirections’. Academy of Management Review, 15:2, pp. 241–65.
Oliver, A.(2001)‘Strategic alliances and the learning life-cycle of biotechnology firms’ Organization Studies, 22:3, pp. 467–89. 10.1177/0170840601223004.
Orton, J.D. (1997) ‘From Inductive to Iterative Grounded Theory: Zipping the Gap between Process Theory and Process Data’, Scandinavian Journal of Management, 13:4, pp. 419-38. http://dx.doi.org/10.1016/S0956-5221(97)00027-4.
Oxley, J.E. and Sampson, R.C. (2004) ‘The scope and governance of international R&D alliances’, Strategic Management Journal, 25:89, pp. 723–49. http://dx.doi.org/10.1002/smj.391.
Ozman, M. (2009) ‘Inter-firm networks and innovation: a survey of literature’, Economic of Innovation and New Technology, 18:1, pp. 39–67. http://dx.doi.org/10.1080/10438590701660095.
Patton, M. Q. (1990) Qualitative evaluation and research methods. CA: Thousand Oaks. Sage.
Perreault,W. D. and Leigh, L. E. (1989) ‘Reliability of nominal data based on qualitative judgments. Journal of Marketing Research, 26:2, pp. 135-148. http://dx.doi.org/10.2307/3172601.
Pettigrew, A.M. (1997) ‘What is Processual Analysis? Scandinavian Journal of Management, 13:4, pp.337-48.
Pfeffer, J.and Salancik, M. (1978) ‘The external control of organizations: A resource dependence perspective’, New York. Harper and Row.
Pisano, G.P. (1997) ‘The Development Factory: Unlocking the Potential of Process Innovation’, HBS Press, Boston, Mass.
Porter, M. (1990) ‘The competitive advantage of nations’, New York. Free Press.
Powell,W. (1990) ‘Neither market nor hierarchy: Network forms of organization’, Research in organizational Behaviour, 12, pp. 295–336.
Powell, W.W. Koput, K.W. and Smith-Doerr, L. (1996) ‘Inter-organizational collaboration and the locus of innovation: networks of learning in biotechnology’, Administrative Science Quarterly, 41:1, pp.116–45. http://dx.doi.org/10.2307/2393988.
Prahalad, C.K. and Mashelkar, R.A. (2010) ‘Innovation’s Holy Grail’. Harvard business review, (online) (cited 17 July 2009). Available from < URL:http://hbr.org/2010/07/innovations-holy-grail/ar/1 >
Ring, P. and Van de Ven, H. (1994) ‘Developmental processes of cooperative inter-organizational relationships’, Academy of Management Review, 19:1, pp.90–118.
Schumpeter, J. (1934) ‘The theory of economic development’, Cambridge. MA. Harvard University Press.
Shan, W.Walker, G.and Kogut,B.(1994)‘Interfirm cooperation and startup innovation in the biotechnology industry’, Strategic Management Journal, 15:5, pp. 387–94. http://dx.doi.org/10.1002/smj.4250150505.
Soh, P. and Roberts, E.B (2003) ‘Networks of innovators:A longitudinal perspective’, Research Policy, 32:9, pp. 1569–88. http://dx.doi.org/10.1016/S0048-7333(03)00065-9.
Smith, O.J. and Powell, W (2004) ‘Knowledge networks as channels and conduits: the effects of spillovers in Boston biotechnology community. Organization Science, 15:1, pp. 5–21. http://dx.doi.org/10.1287/orsc.1030.0054.
Strauss, A.L. and Corbin, J. (1990) ‘Basics of qualitative research: Grounded theory Procedures and techniques’, London. Sage.
Summit Corporation Plc (2008) ‘Summit plc enters into a co-development agreement with the Lilly tb drug discovery initiative for tuberculosis programme’. (online) (cited 26 September 2010). Available from: < URL http://www.summitplc.com/uploads/08_summ_13tbfinal.pdf >
Thorelli, H.B. (1986) ‘Networks: Between markets and hierarchies’, Strategic Management Journal, 7:1, pp. 37–51. http://dx.doi.org/10.1002/smj.4250070105.
Walker, G. Kogut, B. and Shan. W. (1997) ‘Social capital, structural holes and the formation of an industry network’, Organization Science, 8:2, pp. 109.
Wernerfelt, B. (1984) ‘A resource-based view of the firm’, Strategic Management Journal, 5:2, pp. 171–80. http://dx.doi.org/10.1002/smj.4250050207.
Williamson, O. (1991) ‘Comparative economic organization: The analysis of discrete structural alternatives’, Administrative Science Quarterly, 36:2, pp. 269–96. http://dx.doi.org/10.2307/2393356.
Whittington, K.B. and Smith, J.O. (2009) ‘Networks, propinquity and innovation in knowledge intensive industries’, Administrative Science Quarterly, 54, 90-112.
Wolf, F.M. (1986) ‘Meta-analysis: quantitative methods for research syntheses, London. SAGE

How to Cite

Vivek Verma , Vasilki T Zoumpa. The Positive Impact of Inter-Organizational Networking in Innovation in Biotechnology Industry: Comparative Case Analysis of Biotech Network One Nucleus. J.Technol. Manag. Grow. Econ.. 2023, 01, 55-88
The Positive Impact of Inter-Organizational Networking in Innovation in Biotechnology Industry: Comparative Case Analysis of Biotech Network One Nucleus

Current Issue

PeriodicityBiannually
Issue-1May
Issue-2November
ISSN Print2321-2217
ISSN Online2321-2225
RNI No.CHAENG/2013/50088
OA Policy

Publisher's policy of the journal at Sherpa UK for the submitted, accepted, and published articles. Click OAPolicy

Plan-S Compliance

To check compliance, one has to use the Journal Check Tool (JCT). This tool provided by cOAlition S (European funders) for the researchers (fundee) to check the compliance with the journal.

Recommend journal to your library

You can recommend the journal being a researcher or faculty member to your library. We will post a copy of the Journal to your library on your behalf at free of cost.
Click here: Recommend Journal

Preprint Arxiv Submission

The authors are encouraged to submit the author’s copy (preprint) to appropriate preprint archives e.g. https://arxiv.org and/or on https://indiarxiv.org or institutional repositories (e.g., D Space) before paper acceptance by the editor of Journal. After publications of the paper author(s) should mention the citation information, title and abstract along with DOI number of the publication carefully on the required page of the depository(ies).

Contact: Phone: +91-172-2741000, +91-172-4691800

Email : editor.tmg@chitkara.edu.in;

Abstract and Indexing

Information

This work is licensed under a Creative Commons Attribution 4.0 International License.

Articles in Journal of Technology Management for Growing Economies(J.Technol. Manag. Grow. Econ.) by Chitkara University Publications are Open Access articles that are published with licensed under a Creative Commons Attribution- CC-BY 4.0 International License. Based on a work at https://tmg.chitkara.edu.in/. This license permits one to use, remix, tweak and reproduction in any medium, even commercially provided one give credit for the original creation.

View Legal Code of the above-mentioned license, https://creativecommons.org/licenses/by/4.0/legalcode

View Licence Deed here https://creativecommons.org/licenses/by/4.0/

Creative Commons License

Journal of Technology Management for Growing Economies by Chitkara University Publications is licensed under a Creative Commons Attribution 4.0 International License.
Based on a work at https://tmg.chitkara.edu.in/

Members