This paper explores the scope and governance of international R&D alliances, focusing on how firms balance knowledge sharing and protection. R&D alliances allow firms to collaborate on technological development, but they pose challenges in protecting valuable knowledge. Prior research suggests that governance structures, such as equity joint ventures, help manage these risks. However, when partner firms are direct competitors in end-product or strategic resource markets, even protective governance structures may not be sufficient. In such cases, firms may limit the scope of alliance activities to reduce knowledge sharing risks.
The paper argues that the scope of an R&D alliance—determined by the range of activities included—can be a key mechanism for controlling knowledge leakage. It examines how firms decide whether to focus on R&D alone or include other activities like manufacturing and marketing. The study uses empirical data from R&D alliances in the electronics and telecommunications equipment industries to test hypotheses about the factors influencing alliance scope and governance.
Key findings include that firms are more likely to limit their alliance scope when they are direct competitors in final product and geographic markets. Competitors are especially averse to adding joint marketing activities to their R&D collaborations. Alliance scope is also influenced by the absorptive capacity of partner firms, which affects their ability to cooperate broadly, particularly in joint manufacturing. The paper also finds that broader alliance scope is associated with more protective governance structures, such as equity joint ventures, but that these structures may not always be sufficient to control knowledge leakage when partners are direct competitors.
The study highlights the complex interplay between alliance scope and governance in managing knowledge risks. It suggests that firms may choose to narrow the scope of their alliances when facing competitive threats, even if it means forgoing some potential benefits of collaboration. The paper concludes that both alliance scope and governance can serve as substitutes for protecting technological assets in R&D alliances.This paper explores the scope and governance of international R&D alliances, focusing on how firms balance knowledge sharing and protection. R&D alliances allow firms to collaborate on technological development, but they pose challenges in protecting valuable knowledge. Prior research suggests that governance structures, such as equity joint ventures, help manage these risks. However, when partner firms are direct competitors in end-product or strategic resource markets, even protective governance structures may not be sufficient. In such cases, firms may limit the scope of alliance activities to reduce knowledge sharing risks.
The paper argues that the scope of an R&D alliance—determined by the range of activities included—can be a key mechanism for controlling knowledge leakage. It examines how firms decide whether to focus on R&D alone or include other activities like manufacturing and marketing. The study uses empirical data from R&D alliances in the electronics and telecommunications equipment industries to test hypotheses about the factors influencing alliance scope and governance.
Key findings include that firms are more likely to limit their alliance scope when they are direct competitors in final product and geographic markets. Competitors are especially averse to adding joint marketing activities to their R&D collaborations. Alliance scope is also influenced by the absorptive capacity of partner firms, which affects their ability to cooperate broadly, particularly in joint manufacturing. The paper also finds that broader alliance scope is associated with more protective governance structures, such as equity joint ventures, but that these structures may not always be sufficient to control knowledge leakage when partners are direct competitors.
The study highlights the complex interplay between alliance scope and governance in managing knowledge risks. It suggests that firms may choose to narrow the scope of their alliances when facing competitive threats, even if it means forgoing some potential benefits of collaboration. The paper concludes that both alliance scope and governance can serve as substitutes for protecting technological assets in R&D alliances.