Casting a Wide Net for Innovation: Mediating Effect of R&D Human and Social Capital to Unlock the Value from Alliance Portfolio Diversity
| DOI | http://doi.org/10.1111/1467-8551.12310 |
| Date | 01 October 2019 |
| Published date | 01 October 2019 |
| Author | Mercedes Sanchez Garcia,Marian Garcia Martinez,Ferdaous Zouaghi |
British Journal of Management, Vol. 30, 769–790 (2019)
DOI: 10.1111/1467-8551.12310
Casting a Wide Net for Innovation:
Mediating Eect of R&D Human and
Social Capital to Unlock the Value from
Alliance Portfolio Diversity
Marian Garcia Martinez , Ferdaous Zouaghi 1and
Mercedes Sanchez Garcia2
Kent Business School, University of Kent, Canterbury CT2 7PE, Kent, UK, 1Institute for Advanced Research
in Business and Economics (Inarbe), Public University of Navarra, Centro Jer´
onimo de Ayanz, Campus
Arrosad´
ıa, 31006, Pamplona, Spain, and 2Department of Business, Public University of Navarra, Edificio
Madro˜
nos, Campus Arrosad´
ıa, 31006, Pamplona, Spain
Corresponding author email: m.garcia@kent.ac.uk
This paper examines the performance eects associated with dierent alliance portfo-
lio configurations in terms of geographical location and partner type. Based on these
distinctions, the authors hypothesize that more diverse alliance portfoliosenable fir ms to
gain and exploit innovationopportunities. Additionally, the mediating eects of R&D hu-
man and social capital on the R&D alliance portfolio diversity–innovation performance
relationship are explored.The authors reason that the absorptive capacity of R&D intel-
lectual capital determines a firm’s potential gains from highly diverse alliance portfolios.
From panel data of manufacturing firms in Spain for the period 2008–2013, the results
confirm the inverted U-shaped relationship between alliance portfolio diversity and firm
innovation performance, implying that both insucient and excessive alliance portfolio
diversity may be detrimental to firm innovativeness. Additionally, R&D human and so-
cial capital partially mediates the R&D alliance diversity–innovation performance rela-
tionship, emphasizing the importance of internal capabilities to leverage the benefits of
highly diverse alliance portfolios. These findings add a dynamicdimension to the concep-
tualization of alliance portfolios and how firms create value by balancing explorative and
exploitative alliances.
Introduction
Inter-organizational alliances are increasingly
recognized in the innovation management litera-
ture as ‘access relationships’ that enable partners
The authors gratefully acknowledge the funding received
through the AGL2015-65897-C3-1 research project co-
financed by FEDER, and they would also like to express
their gratitude for the financial support receivedfrom the
Public University of Navarra for the acquisition of the
pre-doctoral scholarship (Modality type B). A word of
sincere appreciation to the anonymous referees for their
valuable comments and suggestions.
to acquire non-redundant knowledge and capa-
bilities residing outside their organizational and
technological boundaries (Chesbrough, 2012; Cui
and O’Connor,2012; De Man and Duysters, 2005;
Vasudeva and Anand, 2011). Resource-based
scholars argue that strategic alliances facilitate
access to diverse markets and technological
knowledge and boost innovation by enhancing
combinatory search (for recent meta-analysis see
Lee, Kirkpatrick-Husk and Madhavan, 2017).
These advantages are hypothesized to be par-
ticularly relevant for breakthrough innovation
and novel technologies (Datta and Jessup, 2013;
C2018 The Authors.British Journal of Management published by JohnWiley & Sons Ltd on behalf of British Academy
of Management. Published by John Wiley & Sons Ltd, 9600 Garsington Road, Oxford OX4 2DQ, UK and 350 Main
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This is an open access article under the terms of the Creative Commons Attribution-NonCommercial License, which
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770 M. Garcia Martinez, F. Zouaghi and M. Sanchez Garcia
Garcia Martinez, 2013) or following technological
shocks that create demand for new resources
(Asgari, Singh and Mitchell, 2017).
However, too much diversity of external
sources could adversely impact firm innovation
performance, owing to added complexity and
coordination and integration costs (Duysters and
Lokshin, 2011; Faems et al., 2010; Oerlemans,
Knoben and Pretorius, 2013). Recent research
shows that searching widely and deeply has a
curvilinear (inverted U-shape) relationship with
performance outcomes (Laursen and Salter, 2014;
Vlaisavljevic, Cabello-Medina and P´
erez-Lu˜
no,
2016; Wuyts and Dutta, 2014), suggesting that
R&D alliance portfolio diversity (APD), defined
as ‘the degree of variance in partners’ charac-
teristics’ (Jiang, Tao and Santoro, 2010), could
act as a ‘double-edged sword’ for knowledge
acquisition (Wang and Chen, 2016). The net
benefits first increase and then decrease with the
degree of APD, as organizational tension, com-
plexity and coordination costs begin to hamper
a firm’s ability to leverage the benefits of external
collaboration for innovation (Nasiriyar, Nesta
and Dibiaggio, 2014; Nooteboom et al., 2007).
Consequently, innovation search across highly
diverse alliance portfolios will face diminishing
returns (Garcia Martinez, Zouaghi and Sanchez
Garcia, 2017; Oerlemans, Knoben and Pretorius,
2013).
Within extant alliance portfolio research, lim-
ited research has considered the contingent role
of internal mechanisms and capabilities thatdeter-
mine a firm’s ability to extract value from highly
diverse alliance portfolios. Lakemond et al. (2016)
suggest that knowledge integration through open
innovationcan be considered as a knowledge man-
agement problem, which requiresfir ms to form in-
ternal alliance capabilities to leverage the newly
accessed knowledge (Heimeriks, Klijn and Reuer,
2009; Wuyts and Dutta, 2014). A firm’s ability to
identify, acquire, transfer and apply new external
knowledge depends on its level of absorptive ca-
pacity (Cohen and Levinthal, 1990, Todorova and
Durisin, 2007), suggesting that there is a path de-
pendence in organizational learning (Lane, Koka
and Pathak, 2006; Zahra and George, 2002). In-
deed, Weigelt(2009) argues that the more firms rely
on external sources for innovation, the larger are
the required internal investments in knowledge-
generation activities in order to exploit external
knowledge.
This paper contributes to the debate on the
performance implications of APD and helps to
clarify the configurational and capability per-
spectives of alliance portfolio research. The study
draws on the premise that absorptive capacity as
a dynamic capability provides firms with sources
of competitive advantage (Zahra and George,
2002) by enabling them to combine and redeploy
eectively externally generated knowledge from
highly diverse alliance portfolios in a unique
way. In this context, we examine the mediating
eect of R&D intellectual capital to extract
value from diverse alliance portfolios and argue
that increasing diversity of external knowledge
sources might be beneficial to the firm if the latter
possesses adequate levels of absorptive capacity,
which we operationalize in terms of R&D human
and social capital, for an eective internalization
and combination of external knowledge assets.
This argument builds on recent research on the
micro-foundations of absorptive capacity (e.g.
Lewin, Massini and Peeters, 2011; Volberda, Foss
and Lyles, 2010), suggesting that individuals are
often the key to inter-organizational innovation
(Caloghirou, Kastelli and Tsakanikas, 2004;
Spithoven and Teirlinck, 2010, 2015).
This study makes two contributions to the
alliance portfolio literature. First, we improve
theoretical understanding of alliance portfolio
configuration and how compositional character-
istics of the alliance portfolio aect innovation
performance. We take a strategic approach and
focus on firms’ portfolio of R&D collaboration
types, where we distinguish between geographical,
horizontal and vertical diversity, and provide
evidence to the premise that dierent alliance
portfolio compositions influence the type of exter-
nal knowledge that firms can access and lead to
dierent performance eects (Kotabe and Swan,
1995; Lee, Kirkpatrick-Husk and Madhavan,
2017). The resultant multi-dimensionality, in
contrast to an aggregate measure of all alliances,
acknowledges the potential for recombinationthat
may spur the creation of innovation (Belderbos
et al., 2018; Duysters and Lokshin, 2011; Faems,
Van Looy and Debackere, 2005). We argue that
salient dierences can be expected, depending
on the partner type, and oer new insights into
how R&D alliance portfolios can be configured to
create value, depending on innovation objectives.
Second, this research contributes to the capa-
bility perspective by proposing and testing the
C2018 The Authors.British Journal of Management published by John Wiley & Sons Ltd on behalf of British
Academy of Management.
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