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Wuyts & Dutta (2014) "Benefiting from alliance portfolio diversity: The role of past internal knowledge creation strategy

Q: Where do the first three dimensions of internal knowledge creation relate to?

To what is called organizational pathologies

27 important questions on Wuyts & Dutta (2014) "Benefiting from alliance portfolio diversity: The role of past internal knowledge creation strategy

Where does a diverse alliance portfolio a firm provide with?

With access to non-redundant external knowledge bases

When is a product innovation superior?

When it outperforms the available products in the product category in terms of product advantage for customers

Where are superior products critical to?

To a firm's competitive advantage and growth potential

Why do superior products provide competitive advantage?

Because they are scarce

Where is developing superior products further complicated by?

By great uncertainty, especially in technologically turbulent environments where fundamental scientific breakthroughs give riste to new technological fields

What are the three advantages access to diverse technology domains has?

It stimulates breadth of perspective and creative thinking as innovation often results from recombination across diverse technological fields
Exposure to diverse technology domains further increases the likelihood of new external information being associated with knowledge accessed in the past, which facilitates new knowledge assimilation
Diversity helps firms cope with the scarcity and uncertainty of superior products

What are the drawbacks of portfolio diversity?

Firms that develop a diverse portfolio may face problems of information overload and diseconomies of scale
Recombination of knowledge becomes excessively difficult when diversity is high
Portfolio diversity has been associated with increased difficulty in building strong cohesive ties, transfer of tacit knowledge, and mobilization and coordination of resources along with increasingly unwieldy management structures

What do the authors assert about the question of why some firms benefit more from certain alliance portfolio configuration than others?

That a firm's past internal knowledge creation strategy serves as a source for experience that contributes to the development of higher-order capability to leverage the value of extramural knowledge

What approach do the authors use?

Rather than measuring the capability to leverage extramural knowledge directly, we argue that the strategy that firms have used to develop new knowledge internally is a source of experiences that firms can draw on to leverage extramural knowledge.

Where do the first three dimensions of internal knowledge creation relate to?

To what is called organizational pathologies

What are organizational pathologies?

A tendency to favor the familiar over the unfamiliar; a tendency to prefer the mature over the nascent; and a tendency to search for solutions that are near to existing solutions rather than search for completely de novo solutions

Where can all of these pathologies stand in the way of?

Of optimally benefiting from diverse alliance portfolios as alliances in technologically turbulent environments cover knowledge domains that are relatively unfamiliar to the firm, cover nascent technological advances, and require de novo solutions

Where is the fourth challenge intrinsic to?

Diversity: accessing diverse knowledge bases requires a broad outlook on the technological field

What do the authors assert?

That the experiences firms have accumulated by building an internal knowledge base with:

Low reliance on existing solutions
Attention to the unfamiliar
Attention to the nascent
A broad perspective on the technological field help them leverage the value of extramural knowledge

Where is divergence from existing industry solutions captured by?

By (the inverse of) how strongly firms rely on their prior industry knowledge for creating new knowledge

Where is attention to the unfamiliar in internal knowledge creation captured by?

By how much firms rely on knowledge they have previously developed in-house versus knowledge that was developed externally by other firms

Where is firms' attention to the nascent captured by?

By the recency of technological developments they rely on to create new technological knowledge

Where is firm's broad oulook on the technological field captured by?

By the diversity of knowledge domains they rely on for creating new knowledge

What is a first challenge related to superior product innovation in technologically turbulent environments?

Firms needs to deviate from previously developed industry knowledge

Where is the tendency to build further on one's own previous R&D efforts referred to?

As local search

What is the inherent risk of local search?

Firms get locket in with familiar paths and become better and better at competencies that are less and less valued by the environment, resulting in a decrease in fit between competency and environment

When is it better able to evaluate and venture into external knowledge domains?

When a firms has experience with creating new knowledge internally on the basis of external rather than proprietary knowledge

Why do firms need to form alliances with firms that provide the latest technologies and optimally benefit from these by being internally experienced with nascent technology?

This experience can be used to identify new alliance opportunities and their potential to develop superior new products

Why does superior product innovation require insight into diverse knowledge domains?

To achieve a better match with customer requirements

What does sourcing from diverse knowledge domains provide?

Opportunities for experimentation and recombination

What does sourcing from diverse knowledge domains enable?

To circumvent limitations of bounded rationality and local search

What does the contingency theory suggest?

That not all firms profit equally from portfolio diversity: firms that embed internal knowledge creation less in prior industry knowledge and that rely more on diverse knowledge are more likely to develop superior products.

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