Diversification dynamics of the Japanese industry

Gemba, Kiminori; Kodama, Fumio

doi:10.1016/s0048-7333(00)00140-2

Cited by 63 publications

(28 citation statements)

References 11 publications

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“…From this point of view, most of the previous studies demonstrate that technological diversification is positively linked with a firm's performance, as it leads to more innovation and creates synergy among technological resources such as know-how and intellectual properties [5][6][7]15,20,28]. There are also, notwithstanding, many reviews that argue a firm should focus on specific technology due to specialization and economy of scale [29][30][31][32][33]. On the other hand, researchers acknowledge that the relationship between technological diversification and performance is not linear as the technological diversification increases, but rather, curvilinear of inverted-U, because of the correlation between the synergy among resources and the management cost [16,[34][35][36].…”

Section: Introductionmentioning

confidence: 99%

Dynamic Technological Diversification and Its Impact on Firms’ Performance: An Empirical Analysis of Korean IT Firms

2017

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Abstract:This paper aims to analyze the influence of the technological diversification on a firm's innovation capabilities and investigates the effect of various strategies on the firm's financial performance in a technology-oriented environment. We employ the entropy measurement to calculate technological diversification with 2095 patents, which are applied from years 2009 to 2011 by 507 firms that have participated in Korean government Information Technology (IT) Research and Development (R&D) supporting programs. In our framework, a firm should not diversify among the related technology fields, but should concentrate on a specific technology to reinforce the competitive advantage. However, in the case of the firms with sufficient resources, increasing technological diversification among the unrelated technology fields plays a key role on the firms' performance. Furthermore, the degree of the technological diversification should be adjusted dynamically in compliance with the change of a firm's innovation capabilities. Therefore, these results suggest that a firm should develop differentiated competitiveness through specialization by prioritizing its capabilities, and then exploit unrelated technological diversification to search for new opportunities.

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Section: Introductionmentioning

confidence: 99%

Dynamic Technological Diversification and Its Impact on Firms’ Performance: An Empirical Analysis of Korean IT Firms

2017

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“…-12/23-The right hand-panel of Table 4 supports hypothesis 1, stating that diversity increases patenting activity as proposed by Gambardella and Torrisi (1998), Gemba and Kodama (2001), Nesta and Saviotti (2005) and Garcia-Vega (2006). 5 Concretely, the log of diversity is significantly positive in both models allowing for non-linearity in the impact of diversity.…”

Section: Insert Table 4 About Herementioning

confidence: 59%

“…Garcia-Vega (2006), Gambardella and Torrisi (1998), Gemba and Kodama (2001), and Nesta and Saviotti (2005) found a positive relationship, while Leten et al (2007) found an inverted-U relationship between technological diversification and number of patent application.…”

Section: Benefits Of Technological Diversificationmentioning

confidence: 98%

Technological Diversification and Innovation Performance

Bolli

Woerter

2013

SSRN Journal

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Standard-Nutzungsbedingungen:Die Dokumente auf EconStor dürfen zu eigenen wissenschaftlichen Zwecken und zum Privatgebrauch gespeichert und kopiert werden.Sie dürfen die Dokumente nicht für öffentliche oder kommerzielle Zwecke vervielfältigen, öffentlich ausstellen, öffentlich zugänglich machen, vertreiben oder anderweitig nutzen.Sofern die Verfasser die Dokumente unter Open-Content-Lizenzen (insbesondere CC-Lizenzen) zur Verfügung gestellt haben sollten, gelten abweichend von diesen Nutzungsbedingungen die in der dort genannten Lizenz gewährten Nutzungsrechte. Terms of use: Documents in AbstractThis paper analyzes the impact of technological diversity on innovation inputs and success using Swiss firm-level panel data. While we do not find any impact of diversity on R&D intensity, we confirm a positive impact of diversity on patent applications as suggested by the literature. However, since patent applications reflect an intermediate innovation input rather than output, we extend the analysis to the share of sales generated by new products. We find a significant negative effect of diversity on the sales share of new products. Hence, technologically more specialized firms have a lower propensity to patent and greater shares of new products. We find neither a direct nor indirect effect of diversity on the sales share generated by improved products. These results suggest that specialization pays-off through more drastic innovations that yield greater market success through a passing monopoly status.JEL Classification: O3

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“…Yet, some studies have illustrated that unrelated diversification or single and vertical product models can well be more advantageous than related diversification (Michel & Shaked, 1984). Past studies on the Japanese case usually supported the benefits of related diversification (Gemba & Kodama, 2001;Itami et al, 1982). The findings of Geringer et al (2000), however, question the validity of those arguments, because they find varying effects of product diversification on performance in a longitudinal analysis of the Japanese multinationals.…”

Section: Product Diversificationmentioning

confidence: 99%

“…The outcomes of all of those studies remain mixed and inconsistent, in any case. Some argued for the positive effects of product diversification (Gemba & Kodama, 2001;Itami, Kagono, Yoshihara, & Sakuma, 1982), while others claimed the varying effects (Colpan & Hikino, 2005;Geringer et al, 2000). International diversification is argued to be positive in Delios and Beamish (1999) but negative in Geringer et al (2000).…”

mentioning

confidence: 99%