The evolution of cluster network structure and firm growth: a study of industrial software clusters

Since the cluster began to receive attention as a critical environmental factor in geographical economics, it has provided a major research methodology across multiple disciplines from industrial organization, strategic management, regional innovation system, and Triple Helix to virtual clusters. Network structure analysis (NSA) offers a common framework to observe clusters that have been studied separately from the viewpoint of industrial organization and strategic management. Industrial structure analysis, is based on the externality of a network and the resource-based view, focused on the inherent network capacity, have been combined with the study of structural changes through cluster NSA, to create a new direction for the growth of industry and individual firms. This study aims to analyze the correlation between the networking of structural change and a firm’s performance by selecting a software industrial cluster as a representative case for the knowledge industry. We examine the network structural positions of each node during the cluster evolution process. This empirical study has significance for establishing a firm’s growth strategy as well as supporting the policy about clusters, through outlining the dynamic evolution process of the networking activities in a knowledge industry cluster.     

External Knowledge and Innovation Performance in Clusters: Empirical Evidence from the Uruguay Software Cluster

The importance of geographic proximity for innovation has been widely stressed in the cluster literature. Yet, new insights from the inter-organisational network and cluster literatures underline the role of non-local linkages in enabling firms in networks to enhance learning and to innovate. This paper contributes to this literature by examining the importance of local and non-local knowledge networks for the innovation performance of firms in clusters. Our analysis is based on primary data from a survey of 95 software firms clustered in Montevideo, Uruguay. The results highlight that the most innovative firms in clusters heavily rely on non-local knowledge networks. Moreover, the number of indirect local ties to other firms is a better predictor of innovative performance than the number of direct local ties. Finally, our findings confirm the presence of knowledge gatekeepers in clusters and emphasise their role in enhancing innovation in clusters by absorbing knowledge from extra-cluster sources and diffusing it to other local firms.     

Overcoming Undesirable Knowledge Redundancy in Territorial Clusters

This work analyzes the existence of redundant knowledge associated with geographic networks of firms. Specifically, our research focuses on how firms can avoid inefficient redundancy ties derived from territorial clusters. We propose that firms embedded in a dense and strong-tie network generate redundant knowledge flows. However, they may use structural dispersion to mediate and overcome this limitation. Our empirical study was conducted drawing on the Spanish ceramic tile industrial cluster to test the potential association between social capital and redundancy. Our findings support the idea that structural dispersion mediates the effects of strong ties and the generation of knowledge redundancy.     

Internationalization Speed and Firm Performance: A Study of the Market-Seeking Expansion of Retail MNEs

Existing research is divided on whether firms that rapidly expand their overseas operations perform better than firms that internationalize slowly. Drawing on Penrose’s theory of the growth of the firm, we argue that the positive effects of rapid internationalization give way to negative effects with increasing internationalization speed, leading to an inverted U-shaped association between internationalization speed and firm performance. We analyze the market-seeking expansion of 110 retailers over a 10-year period (2003–2012) and find support for a curvilinear relationship between internationalization speed and firm performance that is moderated by the geographic scope of firms’ internationalization path and firms’ international experience. Our study contributes to resolving conflicting views on the link between internationalization speed and firm performance.     

R&D and firm performance in the semiconductor industry

While the semiconductor industry is still dominated by large vertically integrated firms, fabless firms, which outsource their manufacturing, are gaining market share. Fabless firms are considered to have an advantage in product innovation, as they can focus their innovation efforts on chip design and can benefit from investments in process innovation made by their manufacturing partners. However, there is little empirical evidence of the performance of fabless firms compared to vertically integrated firms. This research empirically examines the relationship between R&D and the financial performance of fabless and vertically integrated firms from 2000 to 2010. Our results show that fabless firms maintain higher gross and net margins, earn a higher return on assets (ROA) and have greater intangible value (Tobin’s q) than vertically integrated firms when controlling for size, capital intensity and R&D ratio (R&D/sales). This supports the argument that fabless firms achieve greater performance by focusing on one part of the innovation process. The relationship of R&D ratio to net margin is negative for the whole sample, suggesting that the industry may be overinvesting in R&D. Notably, the negative relationship is greater for fabless firms, which spend a higher amount of their sales on R&D. The relationship of R&D ratio to ROA and Tobin’s q is negative, and there is no significant difference between fabless and integrated firms. We conclude that fabless firms outperform integrated firms overall, but are somewhat worse in terms of increasing profits and creating value from their R&D investments.     

Coupling or lock-in? Co-evolution of cultural embeddness and cluster innovation-exploratory case study of Shaoxing textile cluster

Based on an exploratory case study of the development of Shaoxing textile cluster for more than 30 years, through the cross-level and multi-dimensional deconstruction of cultural embeddednesss(CE), this article dynamically analyzes the co-evolution relationship and results of its effect on the innovation capabilities of the cluster. The case study results show that CE affects the network structure and network behavior of cluster firms, which leads to the differences of innovation capabilities between cluster firms and the overall clusters. There exists a co-evolution relationship between CE and cluster innovation capabilities, and the result will lead to co-evolution coupling or lock-in. Co-evolution coupling appears in the early stage of cluster development; while co-evolution lock-in appears in the later stage of cluster development. So the embeddedness of same regional cultures may have completely different roles at different stages of cluster development. The root cause is that the network structure and behavior influenced by CE cannot dynamically match the demands for innovation in different stages of cluster's development, and the path dependence of CE evolution leads to change difficultly.     

How does firm size affect technology licensing? Empirical evidence from China

Technology licensing is viewed as the key factor for activating the sleeping patents. This study re-examines the relationship between the firm size and its technology licensing activity. The empirical results show that there is a U-shaped relationship between the firm size and technology licensing. However, this U-shaped relationship appears only in the markets with high competition, which confirms a moderate role of the technology competition in the relationship between the firm size and technology licensing. Chinese firms lag behind developed countries in terms of the licensing strategies. e.g., Chinese firms have fewer patents that are cross licensed. China’s export-oriented firms show relatively more positive licensing propensity, where large, small and medium sized firms do not show essentially different willingness to license out their patents compared with non export-oriented firms. China’s state owned firms are less likely to license out their patents compared with that of private firms. Policy implications are presented at the end of this study.     

An approach for evaluating collaboration attributes in cluster-based companies

This paper presents an approach for evaluating collaboration attributes in companies operating in industrial clusters. From the literature review, we identified governance, geographic proximity, and trust as the main collaboration attributes in industrial clusters. For each of them, there is a set of related sub-attributes that composed the evaluation model. For developing the model, we used the graph theoretic approach (GTA), a methodology for multi-attribute assessment that considers interdependencies among elements of a system to provide an overall evaluation. We applied the model to five companies of a furniture cluster. The results showed the model allows for systematizing relationship management because it highlights the collaboration attributes that need to be improved. Furthermore, the application of the model may contribute to encouraging companies to develop collaborative practices.     

Diverse Institutional Environments and Product Innovation of Emerging Market Firms

• This study unbundled institutional environment into two distinct aspects: institutional distance (the degree of dissimilarity between the institutional environment of a firm’s home country and an economy into which it expands) and institutional diversity (the variety of all the institutional environments to which a firm is exposed), and related them to product innovation performance of emerging market firms.
• Data on 917 Chinese manufacturing firms in multiple industries over 3 years was analyzed.
• The results show a positive relationship between institutional distance and product innovation success. An inverted U-shaped relationship was found between the institutional diversity of a firm’s foreign markets and its product innovation success.

     

Institutional Distance and Foreign Subsidiary Performance in Emerging Markets: Moderating Effects of Ownership Strategy and Host-Country Experience

Institutional distance has been known to be an important driver of Multinational Enterprises’ strategies and performance in host countries. Based on a large panel dataset of 10,562 firms operating in 17 emerging markets and spanning 80 home countries, we re-examine the relationship described by Gaur and Lu (J Manage 33(1):84–110, 2007) between regulatory institutional distance and subsidiary performance. We extend this research by (1) examining this relationship in the context of emerging markets, (2) examining the moderating effects of ownership strategy and host-country experience within the context of emerging markets and (3) accounting for a greater variety of institutions by including a large number of home and host countries. We find that institutional distance negatively affects subsidiary performance in emerging markets. Our findings also show that the negative effects of institutional distance on subsidiary performance are lesser for subsidiaries with partial ownership (than for subsidiaries with full ownership) and for subsidiaries with greater host-country experience. We discuss our findings with respect to Gaur and Lu’s model, which explores the relationships between these variables in a general context.     

Have Chinese universities embraced their third mission? New insight from a business perspective

Have Chinese universities, after enormous investment over the past decade, embraced the university’s third mission—contributing to industrial and technological progress? The literature has not sufficiently addressed this question. This study intends to advance understanding of this issue by empirically addressing this question from a business perspective in a bold and unconventional way. Unlike prior studies that simply used contingent and institutional factors to describe the link between Chinese universities and industrial firms by measuring such aspects as patent licensing, co-patenting, and co-authoring, our work goes further and applies longitudinal analysis to examine the ways firms access university-level knowledge and the impact of such knowledge on firm innovation outputs. We propose that if Chinese universities embraced their third mission, then we would observe a positive effect of university–industry collaborations on firms’ subsequent innovation outputs. Empirical results based on a sample of the top 100 Chinese electronic firms in terms of output value support our hypothesis. Specifically, university patent licensing and co-patenting between universities and firms was found to positively affect firm innovation outputs. Moreover, we found that geographical distance and collaboration dominance moderate the co-patenting–innovation output relationship.     

A neural feature extraction model for classification of firms and prediction of outsourcing success: advantage of using relational sources of information for new suppliers

Clustering is a family of classification techniques, often preceding further analysis or application in a number of fields like data analysis, strategy selection, supplier selection, etc. Data based neural techniques are gaining popularity in clustering applications due to flexibility and adaptability. Kohonen’s Self Organizing Map (SOM) is often used when the objects to be clustered have many attributes. In both supervised and un-supervised modes, Kohonen’s map exhibit good capability to extract a classification which assigns highest weight to the most important attribute. In this paper, we have applied SOM for classification of firms based on their sources of information for new suppliers/customers. Additional data regarding the outsourcing success of the firms’ is added to see if there is an association between a particular set of information sources and the probability of firms’ success to outsource to partner firms. Using data from World Bank BEEPS survey of German industries, we could produce three distinct clusters of industries. When successful outsourcing data were included, it still showed three clusters. The hits were obtained using specific support vector for identification of clusters. We found evidence of associations between relational sources and firms’ ability to outsource successfully.     

Cluster Studies As A Basis For Industrial Policy: The Case Of Denmark

The concept of “resource areas” has been a cornerstone of Danish technology and industry policies since the early 1990s. Cluster studies are central to this approach. While earlier cluster studies were concerned with transactions between firms, frequently in an input-output framework, the more recent studies are based on a demand perspective. The paper discusses the methodologies used in applying the concept of resource areas to Danish industrial clusters, and the strengths and limitations of the approach.     

Physical distance vs. clustering as influences on contracting complexity for biopharmaceutical alliances

Abstract

We examine whether the presence of alliance firms in the same regional cluster or in close physical proximity influences contracting behaviour of biopharmaceutical companies by enhancing coordination and mitigating the need for control. The literature addressing geographical proximity and alliance contracting fails to make a clear distinction between physical co-location and co-location within a cluster, although the two attributes are conceptually distinct. We find that geographic proximity is not related to contracting behaviour. The impact of co-location within a cluster is more nuanced. Specifically, we find that co-location in the San Francisco Bay Area cluster is associated with less complex contracting; however, co-location in other biotechnology clusters does not seem to be related to contracting behaviour. We believe that the informal business environment characterising the Bay Area cluster, as well as unique roles played by venture capital and law firms located in the Bay Area account for the distinct result.     

The relationship between corporate social responsibility and corporate performance: evidence from the US semiconductor industry

This study adopts a two-stage approach to explore the relationship between corporate social responsibility (CSR) and semiconductor companies’ performance during 2004–2008. In the first stage, dynamic data envelopment analysis is adopted to explore whether CSR affects US semiconductor firms’ performance, and the difference in performance between CSR firms and non-CSR firms is analysed; in the second stage, panel data regression is used to determine which quantitative indicators of CSR significantly affect the performance of US semiconductor firms. The empirical results show that social responsibility investment by US semiconductor firms has positive effects on their performance. This study thus suggests that the US semiconductor companies should pay more attention to the CSR quantitative indicators, including human rights, employee relationships, and environment issues in order to enhance their corporate efficiency.     

The Performance of Independent Active SMEs in French Competitiveness Clusters

This article analyses the evolution of independent members of French independent competitiveness clusters. It compares small and medium-sized enterprises (SMEs) that participated in collaborative research projects, funded by French competitiveness clusters, against similar control companies that were not part of such projects and not funded by the policy, over the period 2005–2013. French competitiveness clusters seek to enhance SMEs’ size, performance, innovation and employment; the current study therefore assesses their outcomes in terms of capital invested and equity returns. The findings from a difference-in-differences analysis reveal that sales, employment, R&D investments, and value added all increase in relative terms, but financial returns exhibit significant relative decreases for the smallest companies, whereas larger firms record strong increases. The inability of the smallest SMEs to reap gains from their cluster membership should be a matter of great concern to both companies and policy-makers.     

A comparison of supply chain vulnerability indices for different categories of firms

Given the high vulnerability of today's supply chains to disruptions, measuring and managing supply chain vulnerability has become critical. In the attempt to support practice in reducing supply chain vulnerability, we (1) discuss and define the concept of supply chain vulnerability and (2) measure and compare supply chain vulnerability for various categories of firms. Normal Accident Theory and High Reliability Theory provide the theoretical foundations for the empirical study, and graph modelling is the method used to construct a measure for supply chain vulnerability. The empirical data largely confirm that there is a negative relationship between supply chain vulnerability and supply chain performance, a positive relationship between structural categories (firm size and production type) and supply chain vulnerability, and a positive relationship between supply chain vulnerability and managerial categories (logistics importance, supply chain risk planning, and supply chain risk management).     

The mediator role of learning capability and business innovativeness between total quality management and financial performance

The concept of total quality management (TQM) has attracted many researchers from a variety of disciplines. In particular, the literature has addressed the impact of TQM on a firm’s operations and performance. However, disparate perspectives on the relationship between TQM and a firm’s financial performance have emerged. In this paper, we suggest an interconnected relationship among TQM, organisational learning capability (OLC), business innovativeness, and a firm’s financial performance and propose that OLC and business innovativeness mediate the relationship between TQM and a firm’s financial performance. By studying 193 firms in Turkey, we found that: (1) TQM affects OLC and a firm’s business innovativeness, (2) OLC influences a firm’s business innovativeness and (3) a firm’s business innovativeness affects its financial performance. Also, we found that OLC and business innovativeness in a firm mediate the relationship between TQM and the firm’s financial performance.     

产业技术溢出水平与集群结构的关联分析

依据设计的产业技术溢出系数模型,明确了影响产业技术溢出水平的各因素之间的相互关系,分析了不同结构的产业集群中由于技术溢出所导致的收益分配状况,得出了高技术溢出水平适合于无领导企业的产业集群,低技术溢出水平适合于存在领导企业的产业集群的结论;给出了具体的技术溢出水平取值范围;同时,也为构建产业集群技术创新机制提供了实用性对策思路.