Business economics of knowledge and innovation : an empirical analysis of the role of firms' search diversity

Die Wissensinfrastruktur von Unternehmen spielt eine entscheidende Rolle in der Wettbewerb- Innovation-Dynamik, die interne und externe Wissensmanagementfähigkeiten verkörpert. Diese Dissertation konzentriert sich auf den Wissenserwerb, der nach Chesbroughs trendverändernder Formulierung von Open Innovation (als Suche nach und Nutzung von externem Wissen) zu einem herausragenden Element der Wissensinfrastruktur von Unternehmen wurde. Externe Wissensstrategien als Komponenten externer Wissensmanagementfähigkeiten können zwei Formen annehmen; Search Breadth (spiegelt die Anzahl der Quellen wider, die von Unternehmen erkundet werden) und Search Depth (die Bedeutung verschiedener Quellen, die erkundet werden). Bei der Analyse des Zusammenhangs zwischen Suche nach externem Wissen und Innovation, wird jedoch neben der zugrundeliegenden Allgemeingültigkeit des erworbenen Wissens vor allem die primäre Diversität der Wissenssuche als einflussreich auf die Dynamik verschiedener Arten von Innovation hervorgehoben. Diese Dissertation schlägt eine Suchstrategie vor, die die Vielfalt in der Suche dynamischer und rigoroser erfasst als andere Such Modi und analysiert die Auswirkungen der strategischen Search Diversity auf verschiedene Arten von Innovations. Es gibt drei originelle analytische Richtungen, die in dieser Arbeit untersucht werden, jede davon hat ihre eigenen neuartigen Analyseebenen: 1. Diversität der Wissenssuche und technologische Innovation verlängert auf: Einführung hybrider Suchstrategien zur Neutralisierung von Gegenwirkungen einzelner Suchstrategien, Integration von des moderierenden Mechanismus des Technologieerwerbs in die Beziehung zwischen Search Diversity und technologischer Innovation und Analyse der Rolle von Mergeranteils der Industrien in der Industrie-Search Diversity als endogenes Konstrukt 2. Diversität der Wissenssuche und organizational Innovation verlängert auf: Integration von Marktmechanismen in dieser Beziehung und Integration des exogenen Mechanismus der organisatorischen Innovationsdichte von Unternehmen in verschiedenen Industrien in diesem Rahmen 3. Diversität der Wissenssuche und Logistikinnovation verlängert auf: Integration von der moderierenden Rolle der Marktwettbewerbsintensität in dieser Beziehung und Integration des exogenen Mechanismus der Logistikinnovationsdichte der Industrien in diesem Rahmen.

Competition is the driving force behind innovation and innovation is the reaction of firms to gain competitive advantage. There are different ways in which innovation and competition in the market interact based on the structural and interorganizational relations in industries. Whether firms intend to be first movers in the market or they intend to raise rivals’ costs for being innovative, it is the undeniable role of information that directs the consequences of all such scenarios. For firms to sustain and prosper while competing in their offerings it is vital to introduce processes and skills based on the knowledge they acquire -from market responses (demand and supply side) to all competing choices - to solve their future problems. Innovation as the upshot of competition is a dynamic process of knowledge analysis. How this knowledge is obtained and analyzed on its way to creativity depends on many interacting contextual, environmental and structural factors. Environmental turbulences on one hand draw firms’ attention into being innovative not to get behind in competition (Hannan & Freeman, 1977; Burgelman, 1991; Romanelli & Tushman, 1994; Child, 1997). On the other hand, how such strategies towards idea production yielding to sustainable competitive advantage is very much dependent on contextual framework of the firms (Burns & Stalker, 1961; Lawrence & Lorsch, 1967; Pugh et al., 1969; Blau, 1970; Perrow, 1970; Mintzberg, 1979; Chesbrough & Teece, 1998). Different paths directing those attributes and forces (environmental and contextual) into development of innovation are predominately determined by enterprises’ capacity in knowledge creation and knowledge aggregation (Aygris & Schoen, 1978; Nonaka & Takeuchi, 1995). In other words, it is the environmental dynamisms which provide synergies for firms to innovate (as a perspective for creating competitive advantage), there are enabling factors of innovation as a process (context) and there are functional ecosystems throughout which innovation becomes an output. As literature suggests (Cui, et al., 2005, Hock-Doepgen et al., 2021) such functional ecosystem constitutes the so-called knowledge infrastructure which embodies internal and external knowledge management capabilities. Internal capabilities constitute technology, culture and structure and external capabilities encapsulate knowledge acquisition, conversion and application. Innovative changes can take form in association with either of the elements embodied in knowledge infrastructure. Thus, innovation is not only a breakthrough product or technology being introduced into the market but it also comprises introduction or adoption of new business models or processes. Hence searching for knowledge from the outside world, assimilating it with internal stock and incorporating it into the innovation process plays substantial role in the success of firms’ innovative journeys. Although acquiring knowledge from external environment was exercised in practice (Teece, 1986; March, 1991) even before open innovation was theorized in the seminal work of Chesbrough (2003) (as searching and utilizing external knowledge), it was after his trend changing formulation that it became organized as a prominent element of firms’ knowledge infrastructure. Open innovation implies that knowledge development for successful innovation campaigns cannot be limited to firms’ internal capacities (Gassmann & Enkel, 2004; Dahlander & Gann, 2010) such as their internal R&D investments (Dominici & Levanti, 2011; Varga et al., 2014) and employees’ individual potentials (as partials of context) (Galende & De la Fuente, 2003). Rather, for firms to be able to catch up with the fast-changing market circumstances it is required to extend their search domain outside their boundaries. In fact, external sources of knowledge are the parties who shape up enterprises’ surroundings. Thus, acquiring information from those actors enriches firms’ (industries) idea cultivation to tackle environmental forces and to gain competitive advantage over their rivals. External knowledge strategies as components of external knowledge management capability can take different forms. Search breadth (reflecting number of sources being explored by firms) and search depth (referring to importance of different sources to explore) as prominent external knowledge acquisition practices have attracted much academic attention in open innovation literature (Katila & Ahuja, 2002; Laursen & Salter, 2006; Greco et al., 2015). Nevertheless, when analyzing how search for external knowledge affects technological and non-technological innovative transformations, in addition to the underlying generality of the acquired knowledge, it is the elemental diversity in knowledge search that is mostly emphasized to be influential on dynamics of different types of innovation rather than other aspects (Kaplan, 1998; Hargadon, 2002; Flor et al., 2018). This study proposes and codifies a search approach (as a component to search breadth) which captures diversity in search in a more dynamic and rigorous way than other search modes do. This novel search approach is utilized to analyze the impact of diversifying search (as a search strategy) for external knowledge on different types of innovation outcomes for enterprises. The role of knowledge (acquisition or development) as the most strategic resource of firms (Grant, 1996) on their way to innovative outcomes has been vastly highlighted. Furthermore, the effect of traditional external search strategies on some (rather than all) types of innovation has been treated but the dynamic role of competition in that type of literature has not been comprehensively taken into account. This thesis’s further novelty lies in investigation of how heterogenous knowledge if acquired from external sources is incorporated to explain desirability to initiate diversity of innovations in interaction either with firms’ internal knowledge management capabilities (such as technology) or with market dynamisms (such as competition intensity).Since uncertainties inherent in innovative attempts raises the desirability for variety in innovation (Nelson & Winter, 1977), I shed light on how such varied spectrum of innovations is explained by diversifying strategies in search for knowledge as an open innovation process. There are three main and original analytical directions investigated in this thesis each of which has their own novel layers of analysis: 1. Knowledge search diversity and technological innovation 2. Knowledge search diversity and organizational innovation 3. Knowledge search diversity and logistics innovation.
The first direction extends towards: a) Introduction of hybrid search strategies for neutralizing counter-effects of individual search strategies on their way towards technological innovation. Such approach is developed based on the comparison made between the established patterns of search breadth and technological innovation and that of search diversity and technological innovation according to the outcomes of empirical analyses. b) Integration of the moderating mechanism of technology acquisition (machinery and software) into the relationship between search diversity and technological innovation. c) Integration of the industrys’ merger share into the search strategies framework and analyzing its role in industrys’ search diversity as an endogenous construct.
The second direction extends towards: a) Integration of the moderating mechanisms of market competition intensity and demand uncertainty into the relationship between search diversity and different modes of organizational innovation. b) Integration of the exogenous mechanism of industrys’ organizational innovation density into the correlation of search diversity and of the moderating mechanisms with introduction of organizational innovation by firms in different industries.
The third direction extends towards: a) Integration of the moderating role of market competition intensity into the relationship between search diversity and logistics innovation. b) Integration of the exogenous mechanism of industrys’ logistics innovation density into the correlation of search diversity and of the moderating mechanism with the introduction of logistics innovation by firms in different industries.


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