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

SUMMARY

Based on the literature on learning and technological alliances, this paper explores the relationship between the learning attitude, performance and absorptive capacity with companies' ways of sourcing for technologies. Using a sample of 110 high-tech ventures, the statistical results show a clear link between the span of technology access modes and the learning attitude and absorptive capacity. This behaviour in our sample leads also to a better performance, especially in term of foreign expansion, product innovation and speed of new products commercialization. Suggestions for managers on how to improve their technology access processes are given at the end of the text.

KEY WORDS

technology sourcing; absorptive capacity; attitude towards learning; high-tech businesses

1. INTRODUCTION

Technology sourcing is now crucial for sustaining competitive advantage for firms, in term of innovation or new product development (Kessler et al. 2000). This is obviously true for high-tech businesses (microelectronic, pharmacy, aerospace, etc.). It is also relevant for low-tech businesses that have been transformed by disruptive technologies, such as distribution, because of the Internet (Fulk and DeSanctis 1995). Specifically, high-tech companies, as producers of technologies, have to source outside as well as inside. Over the years, modes of technology sourcing have dramatically diversified, due to the growth of mergers and acquisitions as well as inter-firms alliances. Companies face, for example, difficulties in transferring one technology from one organization to another. Integrating a high-tech start-up after a take-over in a large company is also a well known difficulty that companies have to face. In the case of technological alliances, most of the companies report to be disappointed with the performance of technology consortia (Grindley and Mowery 1994). Technology sourcing was analyzed in relationship with issues such as new product development (Kessler et al. 2000), dependence/independence (Stensma and Corley 2000), previous direct or indirect ties (Vanhaverbeke et al. 2002) or intellectual property protection (Jones et al. 2001).

This paper casts a light on the conditions that have lead high-technology ventures to expand the range of their technology sourcing modes and the issues encountered by companies in this process. To do so, it explores the underlying variables that are hypothesized to facilitate technology sourcing. It suggests that companies should pay more attention to their 'learning attitude' and 'absorptive capacity' when defining their technology sourcing strategy as well as their 'past performance'. The theoretical contribution of this research lies in the modelling of the relationship of these three variables with technology sourcing. Paper is organized into five parts. Section 2 depicts the research theoretical background--a special emphasis is made on the resource based view and the learning literature. Section 3 is devoted to our conceptual framework and the formulation of our research hypothesis. Section 4 explains the methodology used to test empirically our hypothesis. Section 5 presents the results and section 6 discusses the findings.

2. THEORETICAL BACKGROUND

Technology sourcing has considerably diversified over the last twenty years while at the same time companies have been more and more sensitive to the issue of learning. This point is important for large established companies as well as for new high-tech ventures. As such, resource-based and learning literatures will be used as foundations of this research.

2.1 Diversification of technology sourcing modes

As well as auditing the technology portfolio, forecasting technology development, or commercializing technology, technology sourcing is one of the research issue included in the Management of Technology (MoT) discipline (Burgelman et al. 1996; Tushman and Anderson 1997; Tidd et al. 2001). Sourcing for new technologies is needed as company's technology portfolio must be nurtured--especially because technologies are subject to obsolescence (Utterback 1994). Technology sourcing is even a key activity in high-tech firms.

Companies face several options for technology sourcing. The practical issue facing managers is to define which mode one given company should use for gaining access to technologies (Humbert and Jolly 1997). Taking an historical perspective, in-house R&D has long been the sole generator of new technologies. For almost two decades, this autonomous approach has been proved difficult to sustain as a unique source (Friar and Horwitch 1984; Teece 1986). Firms are nowadays still putting a strong emphasis on in-house R&D as demonstrated by the large number of researchers working in companies' labs. But companies have considerably diversified their technology sourcing. This has been observed, for example, in biotech industries (Roberts and Mizouchi 1989; Jolly and Ramani 1996). Technology sourcing includes technological partnerships with competitors, with suppliers, with customers (Fusfeld and Haklish 1985; Nueno and Oosterveld 1988; Hagedoorn 1990; Hagedoorn and Schakenraad 1992; Narula and Hagedoorn 1999), as well as consortia (Spencer and Grindley 1993; Carayannis and Alexander 2002). This covers also technology acquisition with simple license acquisition or more complex take-over of other companies (Roberts and Liu 2001). Technology sourcing also frequently relies on R&D sub-contracting with universities and with public research centers (Roessner et al. 1998). Most companies are now used to sub-contract research, to acquire technology and to partnership with other organizations (Dodgson 1992). Because of globalization of knowledge, growing complexity and increasing uncertainty, this pattern of diversification of technology sourcing modes should continue to expand.

Technology sourcing is important for high-tech ventures for at least three reasons. First, high-tech ventures are often spin-offs of a public research lab or a large private company. This means that the success of these companies frequently relies on technological breakthrough resulting from R&D conducted previously. Their competitive advantages are much more based on technological innovation than on innovative marketing practices. Secondly, the increasing cost of technological development leads companies to develop collaborative behaviours to reach the critical financial size. Furthermore, complexity induces specialization of the technological knowledge developed in companies or R&D centres. As stressed in the resource-based view, there is no single firm having an infinite portfolio of resources. New high-tech ventures are particularly concerned by the acquisition of new knowledge because of their lack of resources (Mc Dougall et al. 1994). It means that complementary assets must be searched outside.

2.2 Resource-based view

The resource-based framework addresses the question of how can the performance of a firm be explained. The traditional explanation suggests that the performance of one firm depends on the characteristics of the environment in which it operates (epitomized by authors such as Learned et al. 1965; Porter 1980; or Buzzell and Bradley 1987). Economic profits are gained from market positioning. In a poor environment, with sluggish (or even negative) growth and numerous competitors, even the best firm will do badly. On the contrary, the resource-based view suggests that the firm's performance is related to the value of its resources and competencies (Wernerfelt 1984; Grant 1991). Scarcity and idiosyncrasy of resources allow the company to capture rents. The objective is no longer to adapt to the environmental forces but to choose a strategy that allows the best exploitation (the best return) of resources and competencies given the external opportunities. As such, the resource-based view displaced the emphasis and the starting point of strategy formulation from the environment to the firm's resources (Hamel and Prahalad 1990).

Resource-based scholars contend that competition in a specific industry should not only be considered from the final service and product point of view. It also has to be gauged with respect to the underlying resources and competencies owned by the firm (Stalk, Evans and Shulman 1992). The typical resource-based strategy is to identify, develop, protect, exploit, deploy and renew resources. Developing resources is done through a constant enlargement and renewal of the resource base. Last section noticed that different modes exist for nurturing the resource-base, such as in-house development, acquisitions and alliances. Regarding the core competencies theory, in order to avoid the transformation of core competencies in core rigidities, companies need to open their mind (Leonard-Barton 1997). Here is the point for the present research. Resource-based approach stresses the importance of technology because it is a source of potential competitive advantage and wealth creation (Prahalad 1993).

2.3 Learning perspective

An organization learns through its individuals (Spender 1996). But organizational learning is more than the sum of learning by individuals' members of the organization (McKee 1992). Senge (1990) defines a learning organization as an organization 'where people continually expand by their capacity to create the results they truly desire, where new and expansive patterns of thinking are nurtured, where collective aspiration is set free, and where people are continually learning how to learn together'. Based on previous works (e.g. Day 1994; Senge 1990; Argyris and Schon 1978), Sinkula et al. (1997) derive the core components of a learning orientation:

* Commitment to learning: simply stated, if an organization does not believe in learning, learning may not occur;

* Open-mindedness: related to the idea of competency trap or core rigidities, an organization must be able to challenge the existing situations, or unlearn (Nystrom and Starbuck 1984);

* Shared vision: a shared vision influences the direction, or focus of learning.

For the authors, these conditions are necessary for learning to occur. As stated by Ribbens (1997), learning, organizational knowledge base, strategy formulation and implementation are interlinked. We define a learning organization as an organization that is committed to learning. By committed, we mean that the organization is ready to change the way it does things by combining existing knowledge or incorporating new knowledge. It encompasses the acquisition, communication, acceptation and absorption phase. Thus, organizational learning processes are neither necessary nor sufficient conditions for a learning organization. But, the existence of organizational learning processes will help the organization to learn.

Organizational learning encompasses the acceptance and assimilation processes of new knowledge with the existing knowledge, using combinative capabilities (Kogut and Zander 1992) or absorptive capacity (Cohen and Levinthal 1990). This concept was defined as 'a set of organizational routines and processes by which firms acquire, assimilate, transform, and exploit knowledge to produce a dynamic organizational capability' (Zahra and George 2002). It indicates that the new venture has internal knowledge that allows it to import, comprehend and use knowledge from external sources.

3. CONCEPTUAL FRAMEWORK AND HYPOTHESIS

We will argue that both absorptive capacity, learning attitude and past performance may interfere with the technology sourcing strategy chosen by companies. Technology sourcing will be analysed according to the number of technology access modes (TAM) used by one single company. Firms position themselves between two extremes. On one side, they might focus almost exclusively on in-house R&D. On the other hand, they might prefer to rely on an extensive number of TAM.

3.1 Technology sourcing and learning attitude

Learning attitude refers to the firm's disposition to acquire new skills. It has been said above that learning is about acquisition, communication, acceptation and assimilation of knowledge in the company. A learning organization will thus be an organization that developed an orientation or attitude toward learning. Learning allows nurturing the ventures' technology portfolio. Inter-organizational learning is a reason for the creation of joint-ventures (Hamel 1991). Sub-contracting with universities and public research centres allow to establish bridges with public research and staying aware of know-what (information) and know why (the scientific principles) (Garud 1996).

Knowledge acquisition and competitive advantage are facilitated by through relational assets (Yli-Renko et al. 2001). High concentration of human resources usually in a single place is one advantage of high-tech ventures regarding learning. This characteristic increases the fluidity of the circulation of information--much more than in multinational diversified companies. On the other hand, high-tech ventures tend to be less organized. One way to alleviate this handicap is precisely to create a learning attitude.

We would like to suggest that companies that are concentrated on in-house R&D do not pay enough attention to their environment. As such, they are not prepared to accept and acquire knowledge from their outside world. It comes that they are not learning oriented. On the other hand, companies that do not rely solely on in-house R&D are open to solutions coming from outside either through technological alliances or technology acquisition. We will assume that concomitantly to their openness, they have developed responsiveness to external knowledge. Their organizations allow accepting, acquiring and assimilating technology developed outside their in-house labs. As such, they are learning oriented. As a consequence, we will hypothesize the following:

Hypothesis 1: Companies with the largest span of TAM are more learning oriented than companies which use a shorter range of TAM.

3.2 Technology sourcing and absorptive capacity

Absorptive capacity is a key element of the knowledge management process. It is a function of the education level and the permeability of the people in place, of the technological level of development, i.e. of the already existing knowledge bases, the resources available to the firm (capital, infrastructures, equipment, etc.) and of the existing systems of management, supports and incentives. Differential absorption capacities induce different learning rates (Kumar and Nti 1998). In order to capture knowledge from an alliance, firms need an absorptive capacity (Parise and Henderson 2001), which in turn will lead to a better alliance selection (George et al. 2002). The same argument prevails when it comes to technology sourcing through acquisition of a start-up. Nevertheless as stressed by Zhara and George (2002), technology sourcing with alliances or acquisitions demonstrates only a potential absorptive capacity rather than a realized one. These forms of acquisition need afterward transformation and exploitation to demonstrate a realized absorptive capacity.

Companies using a large range of TAM are used to settle technological alliances with diverse partners, to sub-contract part of their R&D, to acquire technology through licence agreements or take-over. They are experienced at dealing with external technology stake-holders. All these agreements are channels for the transfer of new knowledge between the outside world and the company. We will suggest that companies used to these diverse TAM are also used to accept and assimilate new knowledge:

Hypothesis 2: Companies with the largest span of TAM are better absorbing innovations created by other companies than companies which use a shorter range of TAM.

3.3 Technology sourcing and performance

We suggest that diversifying technology sourcing has some benefits. Research has shown that when learning processes exist, companies surpass other companies in terms of performance (Calantone et al. 2002; Therin 2002). According to the knowledge-based view, firm performance and development will come from their ability to integrate and use new knowledge (Spender and Grant 1996) or to learn faster than its competitors (Easterby-Smith et al. 1998). Several writers have argued that companies should expand the range of their modes of access to technology. Rothwell and Dodgson (1991) have argued for the complementary between in-house and external know-how accumulation in small and medium sized manufacturing firms. Regarding in-house R&D, Zhara (1996) have shown that there is a positive relationship between internal R&D sources and independent ventures performance; Finally, Autio et al. (2000) have shown that the combination of new knowledge with the existing one will favour the growth.

On the other hand, Miles et al. (1999) have found that when small technology-based firms use alliances, they put themselves in a dependence position, which reduces their performance. They have shown that small technology-based companies should not focus solely on inter-firm alliances as partnering involves the risk of creating dependency on the partner--this means that high-tech small-sized companies should expand the range of their technology sourcing beyond alliances so to increase their performance.

Hypothesis 3: Companies that have the largest span of technology access modes (TAM) outperform the companies which use a shorter range of TAM.

4. RESEARCH METHODOLOGY

4.1 Sample and respondents

A sample of 1000 companies whose names where gathered from the Hoovers directory of companies in 1999 was chosen to collect data. The questionnaire was mailed out in September 2000 to the CEO or President of the company. The companies were chosen based on their affiliation with the technology sectors and their size (less than 500 employees). Questionnaires were answered mainly by the CEO or the President or Vice-Presidents of the companies. The average job tenure was 7.7 years. The result was 110 questionnaires. 50.9 % of the companies are privately owned, 45.4 % are public, while the remaining 3.7% are subsidiaries of other companies. The average number of full-time employees is 88, with numbers ranging from 4 to 465. The sales for 1999 have an average of 25.8 million USD (SD = 99.8), with an export rate of 24.7%. Companies in the sample cover various activities. The two most represented industries are IT and Pharmaceuticals (including biotech).

4.2 Measures and variables

Our constructs were built using sets of perceptual questions (7-points Likert scales) answered by the CEOs or Presidents of the companies. Based on previous works showing good reliability, performance is also based on perceptual measures (Lefebvre and Lefebvre 1996; Sapienza et al. 1988), with a set of 13 items encompassing financial, market and innovation performance.

The learning attitude is operationalized with 8 items (Cronbach's alpha = .89) (see Table 1). Absorptive capacity encompasses two dimensions: potential and realized (Zahra and George 2002). Potential absorptive capacity (PACAP) means that the firm is receptive to the acquisition and assimilation of knowledge. This dimension is operationalized through 9 items (Cronbach's alpha = .90) (see Table 2).

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.

(e) Finally, the link between a large span of modes of access and a tendency for 'foreign expansion' can be explained by an underlying sensitivity for international issues that can be found in the entire company. Companies from group # 1 are relying on a large span of modes of access to technology: they are involved in inter-firm alliances and diverse forms of technology acquisition. For example, when companies establish alliances with their customers, as soon as these customers are from different countries, this is at the same time an opportunity for the company to develop business abroad through events like trade shows, contract with universities, etc. It is well known that technology is becoming more and more a global resource. We assume that companies from group # 1 do not rely solely on national collaborations but are probably involved in international technology alliances and acquisitions. This result is in line with Murray (2001) who argues that successful firms use higher level of alliances based global sourcing.

In summary, companies relying on a large span of modes of access outperform in-house R&D focused companies at the R&D stage but also, when it comes to commercialization, and also commercialization in foreign markets. Once again, this shows that some openness to external sources is an underlying corporate value that transcends functional departments.

6.4 Discussion on causal links

Data presented in the previous section demonstrate only concomitance between two phenomena. In this paper, we do not empirically demonstrate the existence of causalities. Yet, some causalities might be argued. We will suggest a causal link between a learning orientation and the range of TAM used. Personal values differ from one manager to another. Some are naturally open to what is happening outside their company while some others tend to reduce their perspective on the external world. This openness is a component of the learning attitude. Our argument is that managers opened to the external world will also naturally tend to try different types of TAM.

By the same token, we will suggest a causal link between the absorptive capacity and the range of TAM used. That is the company which demonstrate an absorptive capacity, i.e. which is able to better absorb than its competitors, is much more confident to increase its range of TAM--because it trusts much more its ability to benefit from its investments into these different modes.

7. IMPLICATIONS FOR MANAGERS

In order to benefit from a full gain of their technology sourcing, this study tends to demonstrate that managers should concomitantly develop both their learning attitude and their absorptive capacity. Even if the performance is not obviously only explained by this behavioural pattern, encouraging the learning of new ideas or being able to combine innovations created by other companies helps in the expansion of technology access modes for the high-tech ventures. As such, managers of high-tech companies should be aware of the fact that expanding their range of technology sourcing may be facilitated if a learning attitude exists throughout the firm and could be more beneficial if the absorptive capacity is developed.

8. LIMITATIONS AND FURTHER RESEARCH

The first limitation concerns the research sample, which consists only of 110 companies belonging to a large range of industries. The size of the sample limits the range of statistical tools that we were able to use to validate our hypotheses. As such, it was not possible to consider 'learning attitude' and 'absorptive capacity' as constructs and we had to work on their underlying measures. Also, based on these first results, we could question the possible mediating effect of the learning attitude on the relation between Technology Access Modes and performance. Further research is definitely needed to validate those assumptions and develop a stronger model of the relationship between technology sourcing, learning, innovation and performance.

9. CONCLUSION

The study provides a test of the role of absorptive capacity on learning from external sources, an area that has not received much attention. It also shows the importance of a new venture's attitude toward learning as a condition for pursuing external technology sources. Researchers have examined the opposite relationship. For managers, the results highlight the importance of building new venture's receptivity to learn new skills. This is evidenced for the results regarding learning attitude and absorptive capacity. Managers can influence both variables, setting the stage to enhance a new venture's ability to acquire new knowledge that can improve its innovation while improving future performance.

Received 30 August 2006 Accepted 4 October 2007

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DOMINIQUE R JOLLY

CERAM Business School

Sophia-Antipolis, France

FRANCOIS THERIN

Associate Professor

Ecole de Management

Euromed, Marseille, France TABLE 1: OPERATIONALIZATION OF LEARNING ATTITUDE Learning Attitude Mean S.D. Is quick to learn new concepts or ideas 5.31 1.32 Learns from its past mistakes 5.54 1.15 Is dedicated to learning new ideas and concepts 5.74 1.12 Has an organizational culture that encourages learning new ideas, concepts and methods 5.75 1.06 Promotes the sharing of ideas across different units or functions 5.85 1.17 Is good in combining different technologies to develop new products, goods or services 5.43 1.32 Seems unable to learn new things and ideas (rev) 5.76 1.45 Is very slow to recognize new ideas or practices developed in-house (rev) 5.80 1.21 TABLE 2: OPERATIONALIZATION OF ABSORPTIVE CAPACITY Potential Absorptive Capacity Mean S.D. Comprehend innovations developed by other companies 5.52 1.25 Adopt innovations developed by other companies 4.85 1.19 Combine innovations created by other companies with those developed within our company 5.14 1.15 Change its production processes in response to innovations developed elsewhere 4.58 1.29 Implement technologies developed by other companies 4.78 1.27 Use technologies that were developed internally to create new products, goods or services 5.66 1.15 Change its production processes in response to innovations developed internally 5.22 1.28 Learn new skills and concepts 5.51 1.07 Change the way it does things 5.20 1.23 TABLE 3: OPERATIONALIZATION OF TECHNOLOGY SOURCING Access to new technologies Mean SD Buy licences from other companies 3.54 1.81 Contracts with universities 3.59 2.04 Contracts with public research centres 2.96 1.86 Alliances with customers 4.75 1.70 Alliances with suppliers 4.26 1.84 Alliances with competitors 2.99 1.78 Internal R&D 5.50 1.84 Acquisition of other companies 3.13 2.13 Joining research consortia 2.71 1.82 TABLE 4: PROFILE OF THE TWO GROUPS IN TERM OF TECHNOLOGY ACCESS MODES Variables Group 1 Group 2 F (Significance) Buy licences from other companies 4,80 2,48 72,85 *** Contracts with universities 5,10 2,40 80,45 *** Contracts with public research centres 4,00 2,20 31,84 *** Alliances with customers 5,04 4,45 3,29 ([dagger]) Alliances with suppliers 4,65 3,88 4,86 * Alliances with competitors 3,50 2,55 8,27 ** Internal R&D 5,82 5,20 3,10 ([dagger]) Acquisition of other companies 4,26 2,20 31,63 *** Joining research consortia 3,68 1,93 30,71 *** ([dagger])<.1, *<.05, **<.01, ***<.001 TABLE 5: SIGNIFICANT DEMOGRAPHICS FOR THE TWO GROUPS Variables Group 1 Group 2 T-test R&D/Sales (%) 48.7 (66.3) 24.2 (35.4) * Maturity of the major market (7 = Emerging, 1 = Decline) 6.06 (.98) 5.32 (1.34) ** Maturity of the industry (7 = Emerging, 1 = Decline) 5.70 (.93) 5.08 (1.23) ** Maturity of the technologies (7 = Emerging, 1 = Decline) 5.89 (1.04) 5.34 (1.37) * ([dagger]) <.1, *<.05, **<.01, ***<.001 TABLE 6: LEARNING ATTITUDE RESULTS FOR THE TWO GROUPS Learning Attitude Group 1 Group 2 F Is quick to learn new concepts 5.62 (1.28) 5.03 (1.33) 5.41 * Learns from its past mistakes 5.56 (1.27) 5.56 (1.07) .000 Is dedicated to learning new ideas and concepts 6.17 (.95) 5.54 (1.02) 10.48 ** Has an organizational culture that encourages learning new ideas, concepts and methods 6.06 (0.86) 5.54 (1.16) 6.62 * Promotes the sharing of ideas across different units or functions 6.08 (1.13) 5.73 (1.11) 2.66 Is good in combining different technologies to develop new products, goods or services 5.65 (1.34) 5.32 (1.20) 1.73 Seems unable to learn new things or ideas (rev) 5.92 (1.58) 5.73 (1.22) .482 Is very slow to recognize new ideas or practices developed in-house (rev) 6.10 (1.06) 5.58 (1.28) 5.27 * ([dagger]) <.1, *<.05, **<.01, ***<.001 TABLE 7: ABSORPTIVE CAPACITY RESULTS FOR THE TWO GROUPS Absorptive Capacity Group 1 Group 2 F Comprehend innovations developed by other companies 5.77 (1.14) 5.34 (1.32) 2.96 Adopt innovations developed by other companies 5.18 (1.04) 4.60 (1.26) 6.13 * Combine innovations created by other companies with those developed within our company 5.57 (1.02) 4.83 (1.16) 11.33 *** Change its production processes in response to innovations developed elsewhere 4.73 (1.34) 4.48 (1.26) 0.89 Implement technologies developed by other companies 5.16 (1.26) 4.50 (1.23) 7.04 ** Use technologies that were developed internally to create new products, goods or services 5.89 (1.17) 5.50 (1.13) 2.85 Change its production processes in response to innovations developed internally 5.36 (1.28) 5.12 (1.28) 0.9 Learn new skills and concepts 5.82 (0.99) 5.28 (1.07) 6.80 ** Comprehend innovations 5.77 (1.14) 5.34 (1.32) 2.96 developed by other companies ([dagger]) <.1, *<.05, **<.01, ***<.001 TABLE 8: PAST PERFORMANCE RESULTS FOR THE TWO GROUPS Past Performance Group 1 Group 2 F Sales Growth 4.78 (1.69) 4.89 (1.40) .134 Benefits 4.87 (0.97) 4.82 (1.20) .048 Return on sales 4.91 (1.46) 4.60 (1.05) 1.54 Foreign expansion 5.07 (1.68) 3.87 (1.62) 12.95 *** Return on Investment 4.98 (1.56) 4.55 (1.37) 2.17 Product Innovation 5.71 (1.18) 5.11 (1.50) 4.81 * Adoption of new product technologies 5.44 (1.06) 5.07 (1.23) 2.56 Adoption of new process technologies 5.18 (1.34) 4.69 (1.39) 3.15 Transforming R&D results into products 5.47 (1.10) 4.82 (1.55) 5.56 * Product quality 5.58 (1.03) 5.20 (1.25) 2.63 Success in new product commercialization 5.16 (1.15) 4.49 (1.43) 6.39 * Speed of new product commercialization 4.89 (1.19) 4.09 (1.43) 8.93 ** Market responsiveness 5.13 (1.29) 4.76 (1.28) 2.06 ([dagger])<.1, *<.05, **<.01, ***<.001