Relational capabilities to leverage new knowledge

Abstract

Purpose-Focusing on the specific context of two European old industrial regions-South Yorkshire (UK) and North Region of Portugal-this paper aims to identify and conceptualise a set of relational capabilities that business leaders perceive to play a key role in industrial rejuvenation. Design/methodology/approach-A qualitative research design operationalised via case studies was followed for the empirical analysis. Data collection was developed through in-depth interviews with managing directors in small and medium-sized enterprises (SMEs) belonging to the metal and engineering industry and the textile and footwear sectors in the two old industrial regions. Data analysis followed the techniques of data categorisation, within case-analysis and cross-case analysis. Findings-The study identifies relational capabilities that firms use to identify, access and leverage new knowledge: frequent meetings with customers; frequent meetings with suppliers; dialogue with government to influence policy that encourages research and technology transfer; partnership actions for the commercialisation of products and services; active membership with sector associations; immersion in science and technological parks; intentionally establishing links with entrepreneurship-supporting entities; human resources development by technical training institutions; and systematic links with the University. The relational capabilities identified require structured communication processes and alliance management practices to enable and support absorptive capacity and learning in inter-organisational networks. Practical implications-The relational capabilities identified can help position regions in specific markets and value chains, contribute to improving regions' internal and external connections and assist in combining regions' strengths to create industrial capability in high-growth-potential areas. Originality/value-This paper highlights the role of relational capabilities as a way to secure access to knowledge and competencies needed for firms' innovation and avoidance of competency traps. This is particularly relevant in the context of European smart specialisation policy, where key regional stakeholders collectively engage in the identification of areas of competitive strength, enhanced coordination and strategic alignment of resources. The study is not without limitations, as findings are based on case studies of SMEs operating in the manufacturing industry and the analysis of relational capabilities is focused on knowledge novelty.

Strategic Alliances in Knowledge-Intensive Industries: An Integrated View

“…In other words, the firm's knowledge must be protected by a tight "regime of appropriability". Misappropriation hazards arise when profits generated from knowledge is improperly captured by competitors of the original owner of knowledge (Martins, 2016;Meier et al, 2016;and Martynov, 2017). Merges et al (1997) and Liebeskind (1999) argue that it is often difficult and costly to claim knowledge as private property per se.…”

“…Gambardella (1995) argues that most R&D activities in the biopharmaceutical industry cannot be mediated by arm's length market transactions due to high uncertainty and severe misappropriation hazards. Therefore, broadly speaking, internal development and strategic alliances are the only two viable organizational options in these settings (Martins, 2016;Martynov, 2017). Moreover, Pisano (1990) points out that in biotechnology R&D, technological uncertainties are often intertwined with contractual uncertainties.…”

“…In sum, when an LPC faces significant barriers to internalization, it has to turn to NBFs to obtain key technologies in certain therapeutic or diagnostic areas (Di Guardo & Harrigan, 2016;Martins, 2016;and Martynov, 2017). Under these circumstances, however, transaction hazards may not only persist, but also worsen, because of NBFs' bargaining power due to their monopoly in biotechnology know-how.…”

“…A closer look at R&D alliances in biotechnology reveals a mutual hold-up problem. While NBFs have an advantage in upstream R&D capabilities in biotechnology, LPCs own critical complementary assets and skills in downstream manufacturing and marketing (Teece, 1986;Pisano et al, 1988;Sosa, 2009;and Martins, 2016). Once an LPC and an NBF enter into an R&D alliance, they become dependent on each other.…”

“…Instead, it requires stronger governance structures such as strategic alliances (e.g., R&D contracts, R&D collaborations, joint ventures) and vertical integration (Williamson, 1985(Williamson, , 1991. Before the new biotechnology was invented, LPCs had few if any strategic alliances with small R&D firms (Pisano et al, 1988;Barley et al, 1992;Hoang & Rothaermel, 2016;and Martins, 2016). To catch up with the new technological wave, LPCs have not only invested considerable resources in internal R&D projects in biotechnology, but also built various linkages with other firms and research institutions.…”