New venture technology sourcing: exploring the effect of absorptive capacity, learning attitude and past performance.

For technology sourcing, we ask companies about the different ways they use to access to new technologies: licensing, contracts, alliances, internal R&D or acquisition. The characteristics of the different items are presented below (see Table 3).

Based on respondents' answers, industries were characterised with 8 categories: 1. Pharmaceuticals (9.8%), 2. Biotechnologies (21.6%), 3. Electronics (23.5%), 4. Chemicals (4.9%), 5. Software (8.8%), 6. Manufacturing (6.9%), 7. Equipments (14.7%) and 8. Others (9.8%).

5. RESULTS

5.1 Split of the sample of high-tech ventures

We assume that the characteristics of the companies will be different depending on their behavior toward access to new technological knowledge. As such, we have to split the companies based on these criteria. As it is our first insight into this complex phenomenon, and because of our limited sample size, we decided to simply split the sample into 2 groups, based on the 9 variables measuring how often companies use these different ways of access to new knowledge: buy licenses from other companies; contracts with universities; contracts with public research centres; alliances with customers; alliances with suppliers; alliances with competitors; internal R&D; acquisition of other companies; joining research consortia. Table 4 gives the profile of these two groups.

Table 4 shows two behavioural patterns. The first group (50 companies) can be characterized as the group of companies using a large mix of different TAM. On the opposite, the second group (60 companies) relies more on internal R&D as the main contributor to new technologies; it has less experience of the other modes compared to the first group. In term of demographics, the two groups are different on several criteria (see Table 5). Results were not statistically significant in term of age, number of employees and turnover.

Companies in the group 1 are definitely operating in more emerging and more technology intensive environments than the companies of the other group. Group 1 could be labelled the 'high-tech' group and group 2 the 'med-tech' group.

5.2 Technology sourcing and learning attitude (Hypothesis 1)

Table 6 shows the average scores of each group regarding our eight learning attitude items and the result of an F-test on means differences. This can be compared to the overall average given in section 4.2.

The group of companies using the largest span of modes of access to technology outperform the group of companies focused on in-house R&D on almost all the criteria covered by this analysis: companies using the largest number of modes of access are also companies exhibiting the best learning attitude.

5.3 Technology sourcing and absorptive capacity (Hypothesis 2)

Table 7 shows average scores for each group. Companies relying on several modes of access to technology outperform companies relying more on in-house R&D on almost all the 'acceptance and assimilation' criteria. Four criteria show statistically significant differences. They are: 'adopt innovations developed by other companies', 'combine innovations created by other companies with those developed within our company', 'implement technologies developed by other companies', 'learn new skills and concepts'.

5.4 Technology sourcing and past performance (Hypothesis 3)

It is striking to note that the group of companies using an extended range of modes of access to technology (group 1) outperform, on almost all the 13 performance criteria, the group of companies focused on in-house R&D (group 2) (See Table 8). Nevertheless, not all the criteria show statistically significant differences. Significant criteria are for: foreign expansion, product innovation, transforming R&D results into products, success in new product commercialization, and speed of new products commercialization.

5.5 Effect of industry and moderative effects of maturity

As the industry where the companies operate could influence the results, we tested if there is any significant difference between the two groups on that matter. The [chi square] was not significant.

We could also argue that the maturity of the market, the industry and the technology could influence the relationship between the span of technology access modes and learning attitude, absorptive capacity and past performance. A series of hierarchical regression analyses with the interaction terms was performed and none of them showed significant results. Despite its theoretical interest, for our sample, we can only conclude that it has no effect.

6. DISCUSSION

6.1 Hypothesis 1

Four criteria (out of 8) exhibit statistically significant differences:

* The criteria 'dedicated to learning new ideas and concepts' shows that it comes from a true managerial choice. Companies from group # 1 have chosen to learn as a strategic option;

* The significant departure on the criteria 'organizational culture that encourages learning new ideas, concepts and methods' shows that companies have not only decided to learn, but they have also implemented the organisational structure and the culture required for implementing learning;

* This learning practice also allows companies from group # 1 to quickly 'recognize new ideas or practices developed in-house' as well as quickly 'learn new concepts' (from inside or outside the company).

In summary, being open minded to external sources, learning from these sources and doing it fast is a tremendous source of competitive advantage in a world where time to market became a requirement in many industries.

6.2 Hypothesis 2

On a broad perspective, companies of group # 1 learn more easily than the other. This is because they are used to deal with external sources, to accept differences, to solve conflicting point of views, etc. Once again, this is an exemplification of the value of openness.

As hypothesized, companies using more modes of access to technology can also more easily assimilate this knowledge to develop innovations with or without the internal technologies. The departure of the 'adoption of innovation by other companies' criteria is easily explained. The more modes of access one company use, that is the higher the number of technology providers (customers, suppliers, competitors, universities, public research centers, etc.), the more this company is exposed to new technologies. As a consequence, this company increase its chance to adopt an innovation. Similarly, the higher the number of modes of access, the higher the possible combinations of internal knowledge with external knowledge. By the way, this pooling of knowledge increases the probably of cross-fertilization. Finally, companies that rely on several modes are also companies than are able to implement of technologies developed by other companies because their experience allow them to digest new knowledge more easily.

6.3 Hypothesis 3

Interestingly, significant criteria are very diverse. They show that openness to external sources of technology is not related exclusively to technical criteria but also to market criteria. Let's cast a light for each of the five significant criteria:

(a) The departure on 'product innovation' performance criteria comes straightforward. Companies from group # 1 outperform companies from group # 2 on 'product innovation' performance criteria because they are stimulated by technology transfers and exchanges with their different technology providers. These interactions are a source for generating new or renewed products. Companies from group # 1 are looking for different new sources of technology, while companies from group # 2 are not so much more aware of the development of new knowledge and suffer a competitive disadvantage when it comes to product innovation.

(b) It is very understandable that companies with a large range of TAM are good at 'transforming R&D results into products'. These companies know how to combine these different streams of R&D results into one single product offer. These companies know that, to generate new products, they rarely have all the required knowledge inside. They frequently need to complement their knowledge base--which is done through their different TAM.

(c) Companies of group # 1 have more 'success in new product commercialization' because of their openness. Gaining access to external technology sources allow to embody new features in the product. This gives in turn much more attractiveness to the product when it comes on the market.

(d) Distinctive performance for 'speed in new product commercialization' can be related to a specific choice of mode access to technology. It is well known that new technologies coming from in-house R&D take much more time to emerge than technology gained through acquisition or through a technology alliance (Humbert and Jolly 1997). Time gained for technology access has a direct positive impact on product commercialization. Reducing the time needed for technology access allow to reduce time to market.