Abstract: While scholars increasingly make a distinction between primary and secondary innovation, there is still little consensus about how secondary innovation is created. One line of research emphasizes knowledge concealing, concluding that a focal firm should strive to recycle knowledge within the company, but limit other actors’ to access firm-specific knowledge. Another line, however, provides the contradictory argument, suggesting that firms enhance secondary innovation by selectively revealing knowledge to outsiders. The aim of this paper is to analyze the conditions under which the seemingly contradictory models apply. We identify two industry-level factors – imitation pace and network effects – and we introduce and elaborate on the firm-level factor generative uncertainty to explain alternative paths to secondary innovation in markets where both imitation pace and network effects are high.

Abstract: The paper explores how a restaurant franchisor can increase a franchise chain’s innovation through strategically designing the franchise contract. Based on transaction cost economics and agency theory, three contract terms are examined to see if they affect the franchisor and franchisees’ incentives of devoting efforts into innovation. This research uses trademark registration to measure franchise chains’ product and service innovation, and adopts Zero-inflated Poisson model to deal with the excess zeros in the dependent variables, trademark registration. We find that governance mechanisms embedded within the franchise contract terms influence the franchisor’s and franchisees’ incentives to innovate and thereby impact innovation of the franchise chain.

Abstract: This paper contributes to the alliance literature by investigating the influence of alliance partnership experience on the propensity to engage in external technology commercialization. Overall we find support for the proposition that alliance experience increases the likelihood that a firm will engage in ETC, but only up to a point at which further experience reduces the propensity to engage in ETC. We reason that even firms that have developed an alliance capability through learning reach a saturation point in their ability to further increase the scale and scope of the alliance portfolio. We also find that industry level uncertainty, namely the appropriability regime, pace of technological change and competitive complexity, influences this relationship.

Abstract: This study explores different impacts of open innovation with customers on two innovation dimensions: quality and speed, and subsequently, its effect on firm financial performance. By using two contrasting theoretical lens: lead user theory and Not-Invented-Here psychological principle, we propose that customer involvement is beneficial to innovation quality but harmful to innovation speed. Joint empirical testing of two theories with mediation model could provide a more comprehensive picture for conflicting results of customer involvement in developing innovative products.

Abstract: This research investigates the effect of distinct types of uncertainty on the mode of governance for innovation alliances. I suggest that real options theory predicts the mode of governance when technical and market uncertainty are more salient, and TCE is more applicable to partner uncertainty. At the same time, the uncertainty associated with financial performance has received limited attention in the alliance governance literature. I draw on behavioral theory to propose that both slack and attainment discrepancy moderate the governance decision in favor of more hierarchy, namely acquisitions.

Abstract: Despite the advantages of alliances with local companies, recent studies have suggested that foreign companies may not prefer local companies as their alliance partners in their foreign expansions. Drawing on the knowledge-based view and the homophily literature, we propose that foreign companies are more likely to ally with other foreign companies in an emerging country. Such tendency, however, is attenuated with factors at dyadic, triadic, and industry levels. Specifically, foreign companies’ propensity to ally with foreign counterparts will reduce when the pair share a similar level of experience, when they have a common alliance partner, or when the institution improves in the host country. We test our hypotheses with 1000 foreign Venture Capital firms that invested in China during 2001 and 2012.