Technological diversification, complementary assets, and performance

Chiu, Yi-Han; Lai, Hsien-Che; Lee, Tai-Yu; Liaw, Yi‐Ching

doi:10.1016/j.techfore.2007.07.003

Cited by 73 publications

(50 citation statements)

References 51 publications

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“…In the resource-based view (RBV) framework, technological diversification develops synergy among the internal resources of a firm rather than risk-reduction [5,20]. Inbound open innovation (OI) exploits external resources to explore and obtain knowledge from external sources such as information, alliance and licensing.…”

Section: Introductionmentioning

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].…”

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: Introductionmentioning

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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“…This kind of diversification is particularly value-generating in competitive environments that are characterized by uncertainty (Chiu, Lai, Lee, & Liaw, 2008) as it serves to reduce the risk of the acquirer (Amihud and Lev, 1981). Breschi, Lissoni, and Malerba (2003, p. 69) argued that IT firms, in general, need to broaden their scope "over more than one technology."…”

Section: 2product Complementaritiesmentioning

confidence: 99%

M&As and market value creation in the information security industry

Khansa

2015

Journal of Economics and Business

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“…Kim et al 2009, Miller 2006, Chiu et al 2008). However, they disregard the meaning of technological diversification for innovation output.…”

Section: Literature Review and Hypothesismentioning

confidence: 99%

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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Technological diversification, complementary assets, and performance

Cited by 73 publications

References 51 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

M&As and market value creation in the information security industry

Technological Diversification and Innovation Performance

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