Silvia Massini

Microfoundations of Internal and External Absorptive Capacity Routines

The 20 years following the introduction of the seminal construct of absorptive capacity (AC) by Cohen and Levinthal (Cohen, W. M., D. A. Levinthal. 1989. Innovation and learning: The two faces of RD Cohen, W. M., D. A. Levinthal. 1990. Absorptive capacity: A new perspective on learning and innovation. Admin. Sci. Quart.35(1) 128--152) have seen the proliferation of a vast literature citing the AC construct in over 10,000 published papers, chapters, and books, and interpreting it or applying it in many areas of organization science research, including organization theory, strategic management, and economics. However, with very few exceptions, the specific organizational routines and processes that constitute AC capabilities remain a black box. In this paper, we propose a routine-based model of AC as a first step toward the operationalization of the AC construct. Our intent is to direct attention to the importance of balancing internal knowledge creating processes with the identification, acquisition, and assimilation of new knowledge originating in the external environment. We decompose the construct of AC into two components, internal and external AC capabilities, and identify the configuration of metaroutines underlying these two components. These higher-level routines are expressed within organizations by configurations of empirically observable practiced routines that are idiosyncratic and firm specific. Therefore, we conceptualize metaroutines as the foundations of practiced routines. The ability of organizations to discover and implement complementarities between AC routines may explain why some firms are successful early adopters and most firms are imitators. Success as an early adopter of a new management practice or an innovation is expected to depend on the extent to which an organization evolves, adapts, and implements the configuration of its internal and external absorptive capacity routines.

Conceptual Issues in Services Offshoring Research: A Multidisciplinary Review

Offshoring has emerged as an important economic and social phenomenon that has generated intense interest from practitioners, the popular media, and policy makers. In addition, there is a nascent but rich research literature on offshoring developing in management, international business (IB), and related fields. In this review, we survey and integrate offshoring literature from several disciplines and draw implications of this review for management and IB research. We conclude that offshoring may challenge some aspects of established management and IB theory or require revision and/ or modification of those theories. We adopt a multilevel coevolutionary perspective as one potential integrative approach to offshoring research and identify important future areas for further enrichment of this emerging area.

Knowledge Creation and Organizational Capabilities of Innovating and Imitating Firms

Knowledge, innovation and technological progress have been central themes of research in macro- and microeconomics, innovation processes and strategy. Schumpeter’s (1942) seminal book Capitalism, Socialism and Democracy is often credited with originating and stimulating interest, theoretical development and research on processes of creative destruction, involving new products, processes, markets, resources and organizations, and the role of the entrepreneur.

The evolution of organizational routines among large Western and Japanese firms

Students of innovation and evolutionary economists have long recognized the significance of organizational adaptation, as a consequence of changes in production technology and adoption of technological innovations and in understanding transformation of firms in competitive environments. But changes in organizational structure and procedures of firms remain largely unexplored. The paper explores the adoption and adaptation of new structural and procedural organizational routines and emerging dominant managerial practices, and their relations with technological innovation activities. Drawing on a large-scale survey of organizational characteristics in large European, Japanese and US firms between 1992 and 1996, we map the emergence, diffusion and adaptation of new organizational routines. The analysis identifies firms that show high adoption of organizational routines and firms that leapfrog the leading edge companies. We find a high movement of Western firms toward the frontier previously defined by Japanese managerial practices. We also find a strong association of high R&D intensity with the adoption of new routines in European and American firms, but not in Japan. Overall the analysis supports a dynamic view of adoption of emerging organizational routines and finds an evolutionary pattern of imitation and selection of such routines.

Innovative Forms of Organising in Europe and Japan

Recent writing on contemporary organisations is suggestive of extensive moves to create more responsive and flexible firms. Such claims often rest on studies of exceptional organisations or atypical sectors. Drawing on large-scale surveys of organisational innovations in Europe and Japan, this paper finds widespread but not revolutionary change in terms of organisational structures, processes and boundaries. In comparing innovative forms of organising in 1992 and 1996, the survey results show some similarities in the direction of change between European and Japanese organisations but from different starting points. The pace of innovation is generally much faster in Europe than in Japan. This pattern of more incremental change in Japan and more radical change in Europe is overlaid by a tendency for firms in both regions to seek new forms of organising by simultaneously altering their structures, processes and boundaries. Managing such a complementary change agenda is creating real process challenges for European and Japanese organisations.

The diffusion of mobile telephony in Italy and the UK: an empirical investigation

Since its appearance mobile telephony has shown a remarkably fast diffusion pattern in most advanced countries. This paper investigates technological and economic factors that have influenced the diffusion process of cellular phones, in particular the diffusion speed and the upper limit. The epidemic model widely used in diffusion studies is summarised and discussed highlighting the evolutionary disequilibrium nature of diffusion processes. Moreover, the econometric specification of some of the models distinguishes between long-run relationships and short-run adjustments to a continuously evolving pattern. We find that the new digital technology, which coincides with increased competition in both Italy and the UK, has made the process faster and increased the saturation level in Italy, but not in the UK; in Italy only the decreasing price of the handset has affected the diffusion process, whereas we find that, in addition to that, decreasing tariffs and increasing consumption expenditures have been significant in shaping the diffusion process of mobile telephony in the UK.

Sources of Variation in the Efficiency of Adopting Management Innovation: The Role of Absorptive Capacity Routines, Managerial Attention and Organizational Legitimacy

Drawing on two in-depth case studies, this paper develops a conceptual model of how absorptive capacity routines and their underlying processes of evolution influence the efficiency of management innovation adaptation processes. The model highlights three important relations. First, although different configurations of absorptive capacity routines can lead to the successful implementation of the same management innovation – namely the reconfiguration of firms’ value chains through sourcing of business services from offshore countries – the sequence of developing routines, their adequacy, and the interdependencies fit between routines partly explain how rapidly and seamlessly a firm is able to implement a management innovation. Second, we identify managerial attention and organizational legitimacy as two critical and interrelated sources of variation of the efficiency in the process of adopting and adapting management innovations. Finally, attention direction by a top-level internal change agent is more effective than local problemistic search to foster managerial attention and organizational legitimacy to both the management innovation to be adopted, and the need to develop and put into practice an appropriate set of absorptive capacity routines.

Industry Cognitive Distance in Alliances and Firm Innovation Performance

This paper focuses on the role of industry cognitive distance in innovation alliances on firm innovation performance. Drawing from the literature on technological cognitive distance in alliances, we elaborate on the role of industry cognitive distance between partners and its impact on managerial attention to investigate the role of numbers of alliances of low (intra-industry) and high (inter-industry) industry cognitive distance on firm innovation performance. Intra-industry alliances offer lower opportunities for innovation compared to inter-industry alliances and are less demanding on firm management due to higher cognitive similarity between partners from the same industry. We propose that trade-offs between innovation opportunities and management efforts result in an inverted U and a U-shaped relationship between the number of intra- and inter-industry alliances and innovation performance, respectively. We find support for both hypotheses in the context of the UK bio-pharmaceutical sector.

Industry Cognitive Distance in Alliance Portfolios and Firm Innovation Performance

Drawing from the literature on attention-based view of the firm, knowledge base diversity and cognitive distance in alliances, this paper distinguishes between intra- and inter- industry alliances and investigates the effect of increasing numbers of such alliances on firm innovation performance. Intra-industry alliances offer lower opportunities for innovation compared to inter-industry alliances and are less demanding on firm management due to higher cognitive similarity between partners from the same industry. We propose that trade-offs between innovation opportunities and management efforts will result in an inverted U and a U shaped relationship between the number of intra- and inter-industry alliances and innovation returns respectively. We explore our hypotheses in the context of the UK bio-pharmaceutical sector, and obtain support for both hypotheses.

Innovation Offshoring by Small and Medium-Sized Enterprises – Establishing the Research Gap

Research on innovation offshoring (IO) has increased substantially over the last decade. IO is (still) widely regarded as the domain of multinational enterprises. Even though more and more researchers are claiming that small and medium-sized enterprises (SMEs) also practise IO, so far, the particularities of SMEs have been widely neglected. This is unfortunate, since a small business is not a little big business and thus most of the IO research lacks generalizability to SMEs. This study uncovers the gap and extends the empirical evidence available from scientific publications, obtaining a more current and accurate picture of IO research on SMEs. We directly approached academic experts through an online survey to collect information regarding the specific characteristics of SMEs relevant for IO, managerial needs arising from those characteristics and theoretical approaches appropriate to framing SME-specific IO research. This study provides a toolkit and roadmap for subsequent IO research aimed at SMEs.