Does technological diversification matter to firm performance? The moderating role of organizational slack

Chen, Yi-Min; Yang, De-Hsin; Lin, Feng‐Jyh

doi:10.1016/j.jbusres.2013.02.020

Cited by 65 publications

(45 citation statements)

References 38 publications

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“…We adopt the view that technological diversification can be divided into unrelated technological diversification (UTD), which indicates the extent of technological diversification among irrelevant technology fields, and related technological diversification (RTD), which refers to the extent of technological diversification on relevant technology fields, with the entropy measurement [29,34,[44][45][46]. The entropy measurement has advantages in terms of simple measurement, repeatability, and objectivity compared to categories measurement like seven categories [3,47].…”

Section: Related Technological Diversification (Rtd) Versus Unrelatedmentioning

confidence: 99%

“…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%

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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: Related Technological Diversification (Rtd) Versus Unrelatedmentioning

confidence: 99%

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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“…The launch of iPhone by Apple in 2007 triggered a boom and soaring demand for smart phones, and created a new development direction of consumer electronic products, thus reforming the supply chain system. Due to the positive user experience of iPhone, Google also entered the smartphone market by launching the Android platform in cooperation with the Open Handset Alliance, and using open source to create innovations in the smartphone industry (Chen et al 2013).…”

Section: Data Selection and Descriptionmentioning

confidence: 99%

“…HTC also petitioned to the International Trade Commission (ICT) against sanctions, including the ban on sales of disputed products in the U.S. These actions/reactions have made the smartphone industry highly competitively (Chen et al 2013).…”

Section: Data Selection and Descriptionmentioning

confidence: 99%

How Does Patent Litigation Influence Dynamic Risk for Market Competitors?

Wang

Lin

et al. 2015

Technological and Economic Development of Economy

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Abstract. Many recent studies have discussed the appropriateness of various patent measurement indicators, as well as the differences in the positioning of patented technologies, while there is little discussion on the risk transmission of enterprises when faced with infringement litigation. This study used the bivariate EGARCH (Exponential Generalized Autoregressive Conditional Heteroskedasticity) model with DCC (Dynamic Conditional Correlations) to investigate the dynamic risk transmission of patent litigation between market competitors in the smartphone industry. Empirical results revealed that when facing lawsuits from market challengers, the market leader faces fewer risks when handling patent infringement litigations. In addition, the risk reactions of competitors during patent wars may widely differ. Investors should consider the patent infringement litigations when measuring the dynamic risks of share prices, and determining the optimal configuration of asset portfolios in response.

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“…With the exception of a few studies such as (Mangàni, 2007), the impact of technological diversity on national economies has seldom been investigated, with researchers preferring to focus on technological specialization. Moreover, most diversification studies have been conducted at the firm level, including those that explored the relationships between diversification and firm output factors such as financial performance (Chen, Yang, & Lin, 2013;Chiu, Lai, Lee, & Liaw, 2008;Chun, Ha, & Kim, 2014;Evangelista & Vezzani, 2010). By contrast, studies conducted on a national scale have tended to focus on technological specialization and economic performance (e.g.…”

Section: Introductionmentioning

confidence: 99%

Does Reverse Causality Explains the Relationship Between Economic Performance and Technological Diversity?

Moaniba

Lee

2018

Technological and Economic Development of Economy

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Abstract. Previous studies have highlighted technological innovation as a key instrument for economic development. However, although the relationship between innovation and economic growth has been extensively explored, few studies have investigated the impacts of crucial dimensions of innovation on economic growth. This paper presents one of the first empirical attempts to analyze how the "diversity" aspect of technological progress (or innovation) influences economic performance by considering the possible bidirectional causal effects between these two factors. A series of econometric techniques, including a two-stage-least-squares instrumental variable and dynamic autoregressive distributed lag model, are applied on a dataset of 55 countries. The dataset includes patent data from the United States Patent and Trademark Office and combined macroeconomic data from the World Bank's development indicators and International Monetary Fund's economic outlook databases. The results show that generally, technological diversity does not directly affect economic growth. By contrast, a negative effect of diversity on GDP per capita is observed in nonhigh-income countries. This study contributes to the macroeconomics and innovation management literature by providing an integrated empirical application of various popular firm management theories and a well-known endogenous economic growth theory.

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Does technological diversification matter to firm performance? The moderating role of organizational slack

Cited by 65 publications

References 38 publications

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

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

How Does Patent Litigation Influence Dynamic Risk for Market Competitors?

Does Reverse Causality Explains the Relationship Between Economic Performance and Technological Diversity?

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