Studies on the relationship between cooperation strategy and innovation performance : focusing on partner types for technological and non-technological innovation

Abstract

In a competitive environment in which market conditions and technological changes are rapidly evolving, the importance of innovation has been increasing. However, in order to secure a competitive advantage for firms in the globalized knowledge environment, not only competitive strategies, but also cooperation strategies with external partners are regarded as important innovation activities. This is because it is impossible to secure all technological capabilities on their own for all technologies, even if the firms have an internal innovation capability because the technologies are fundamentally highly convergent with each other. Therefore, cooperation with external partners is considered as an essential element to complement the scarce technological resources. Firms cannot just compete, but they also must build a continuous technology cooperation system with other firms, research institutes, and universities. In addition, cooperation with external partners is not only limited to technological innovation activities, but also draws attention to academics and managers about non- technological innovation activities. Non-technological innovation activities include organizational innovation to improve the quality or efficiency of work flow and marketing innovation such as product promotion to improve consumer awareness of products. In consideration of these changes in the environment, this study analyzes two important points about the relationship between cooperation with external partners and the firms’ innovation performance. Data from the KIS (Korean Innovation Survey) 2010 survey for Korean manufacturing industry performed by Science and Technology Policy Institute (STEPI) was used. First, for product innovation, this study investigates the effects of diversity of R&D partner types and the intensity of R&D cooperation activities for the efficient R&D cooperation structure of firms. In other words, it is analyzed whether it is effective to secure various R&D partners for product innovation or to focus on in-depth cooperation activities with specific R&D partners or to pursue diversity and in-depth cooperation with specific partners at the same time. In order to analyze effectiveness, quality, cost, time and flexibility based on the competitive priority theory of manufacturing are selected as innovative performance indicators. According to the results of the analysis, it was found that the diversity of R&D partner types and the intensity of R&D cooperation activities are different in industry types and product innovation performance types. However, the fact that if there is a diversity effect, there must be an intensity effect also shows a common characteristic regardless of industry type and innovation performance type. On the other hand, even if there is the intensity effect of R&D cooperation activities, it does not necessarily mean that the diversity of R&D partner types is effective for product innovation performances. These results suggest that the key R&D partners playing a central role are more important than maintaining the diversity of R&D partner types for product innovation. Second, considering that firms should respond effectively to the structure of cooperation with external partners as a whole, it is important to apply research on the selection of external partners not only to technological innovation but also to non-technical innovation. Therefore, this study suggests a model that compares effective partner types for product innovation, process innovation, organizational innovation, and marketing innovation according to the innovation type framework based on technological and non-technical innovation perspectives and product and operational perspectives. According to the results of the analysis, cooperation with suppliers is effective for product innovation, process innovation, and organizational innovation, while cooperation with customers is effective for product innovation, process innovation, and marketing innovation. Cooperation with consulting firms is effective for process innovation and organizational innovation, cooperation with public research institutes is effective for product innovation and process innovation, and cooperation with universities has an effect on product innovation and organizational innovation. Meanwhile, cooperation with the same industry (competitors) is effective only in reducing the cost of product innovation. The academic and practical implications of this research are as follows. First of all, from a model point of view, compared to previous studies on R&D partner types, the concept of diversity effect of R&D partner types and the intensity effect of R&D cooperation activities are introduced. The analysis of the relationship between these two concepts on product innovation is a differentiation from the previous research. Second, previous research on partner types mainly focused on product innovation performance as financial performance such as sales or knowledge creation such as patent registration, in this study, product innovation performance was defined as primary innovation performance such as quality improvement, cost reduction, pioneering new market, and industry standardization. For this reason, it is possible to provide a detailed guide to the practitioner to determine which partners to cooperate with in each product innovation performance. In addition, in the field of research on partner types, it is an academically important implication to propose a research model that compares effective partners to technical innovations such as product innovation and process innovation, and non-technical innovations such as organizational innovation and marketing innovation.