How R&D intensive firms react to the COVID-19 pandemic: Evidence from a quasi-natural experiment

Prior research suggests that R&D intensive firms are especially vulnerable during crises due to their narrow specialization, high adjustment costs, increased distress risks, and higher sensitivity to financial distress. This paper exploits the difference in the research and development intensity as a quasi-natural experiment to examine the impact of the coronavirus pandemic on firm performance. Our study finds that the adverse consequences of COVID-19 on firms' profitability have been less pronounced for R&D intensive firms. R&D intensive firms are also able to record more positive changes in cash holdings as a response to the COVID-19 pandemic. As a result, R&D intensive firms are less likely to rely on external financing and record a lower level of increase in financing. Our results further highlight the potential function of R&D investment as a panacea for firm's growth during economic downturns.

Successful patenting—not only how, but with whom: the importance of patent attorneys

The role of patent attorneys is usually overlooked in empirical analyses of patents. Using a large dataset of Polish patent applications, 2006–2015, and the econometric model of logistic regression with interactions, the article identifies factors contributing to the successful patenting outcomes. Patents are more likely to be granted for applications filed by multiple applicants, particularly if a scientific organization is involved. Industry, region and decisions to apply for international protection were found as relevant variables affecting the patent grants. The involvement of attorneys was found to be a strong predictor of the outcome, and the study considered multiple variables characterizing the prior experience of attorneys, including their performance, effectiveness, work with scientific or business clients and support for patent applications that were also filed for international protection. The findings offer novel insights into sources of patenting success, indicating that it’s not only important how the patent applications are drafted and what their detailed contents are, but also who exactly prepares them.

Client-Related Factors and Collaboration Between Human Assets

Collaborations between individuals in firms have important implications for the development of relational and human capital. In knowledge-intensive contexts where collaborations are formed to deliver services to clients, collaboration decisions can involve nontrivial tradeoffs between short-term and long-term benefits: individuals and firms must carefully manage the tradeoffs between leveraging existing relational and human capital for the reliable performance of repeat collaboration and creating new relational and human capital through new collaboration. Building from the premise that servicing clients is central to collaboration decisions in human asset–intensive firms, we examine how client-related factors shape collaboration decisions among lawyers (partners) in UK law firms providing M&A legal advisory services. We focus on three key client-related dimensions that we predict govern collaboration decisions: the depth of individual- and firm-level relationships with the focal client, key client attributes that reflect the client’s status and its use of different firms to undertake its outsourced work, and client-driven individual- and firm-level resource constraint. Our empirical findings support our proposition that client-related factors influence the pattern of collaborations between individuals in firms. We also reveal how client-related factors at the individual level can have opposite effects on collaboration decisions from those at the firm level. Overall, our findings contribute to research on relational capital, strategic human capital, team formation, professional service firms, and the microfoundations of strategy.

The intervention of strategic innovation practices in between regulations and sustainable business growth: a holistic perspective for Malaysian SMEs

Purpose

SMEs that manage more sustainability focused initiatives into their core business strategy can possibly benefit from lower expenses, reduced threats and new business opportunities, but in Malaysia most of the SMEs are still far off in terms of adapting to a sustainable business growth outline from a holistic point of view. Hence, this study aims to serve deeper understanding about a strategic innovation focused sustainable growth model on basis of multidisciplinary QBL-QHIM theoretical perspectives where strategic innovation practices intervene in between desired growth and government support (regulations).

Design/methodology/approach

This conceptual investigation embraces a newly emerged concern of sustainable business growth in SMEs, considering ranges of literature reviews from the disciplines of management and entrepreneurship. The study also systematically explores the concepts of regulations, strategic innovation practices on basis of QBL and QHIM theories to adjust the sustainable business growth model from a holistic angle.

Findings

The outcomes show that multidisciplinary QBL-QHIM conjunction within the interrelationships of the selected constructs holds the potential for innovation focused business growth in a more sustainable, comprehensive and holistic manner. The study also detects that exploitative-explorative innovation practices can possibly mediate in between suitable regulations and sustainable business growth of SMEs, considering supportive external environment.

Research limitations/implications

Researches are encouraged to test the proposed model.

Practical implications

The study indicates a conceptual configuration for policy makers as well as entrepreneurs to ensure sustainable business growth for SMEs. The outcomes of the study also provide useful direction on decision-making process of owner or manager considering social, economic, environmental and spiritual aspects of daily operations.

Social implications

The conceptual model may possibly able to generate more social values, considering a holistic angle into business activities.

Originality/value

The conceptualization is a unique attempt, considering developing regions to extend the current understanding of strategic innovation focused sustainable growth process of SMEs from a holistic angle.

Double-edged sword of interdisciplinary knowledge flow from hard sciences to humanities and social sciences: Evidence from China

Humanities and Social Sciences (HSS) increasingly absorb knowledge from Hard Sciences, i.e., Science, Technology, Agriculture and Medicine (STAM), as testified by a growing number of citations. However, whether citing more Hard Sciences brings more citations to HSS remains to be investigated. Based on China's HSS articles indexed by the Web of Science during 1998-2014, this paper estimated two-way fixed effects negative binomial models, with journal effects and year effects. Findings include: (1) An inverse U-shaped curve was observed between the percentage of STAM references to the HSS articles and the number of citations they received; (2) STAM contributed increasing knowledge to China's HSS, while Science and Technology knowledge contributed more citations to HSS articles. It is recommended that research policy should be adjusted to encourage HSS researchers to adequately integrate STAM knowledge when conducting interdisciplinary research, as over-cited STAM knowledge may jeopardize the readability of HSS articles.

On the Relationship of Value Creation and Value Capture

Scholars of the resource-based theory (RBT) have recently emphasised the need to integrate the concepts of value creation and value capture in the RBT, ultimately to obtain a better understanding of the resource/capabilities-performance link. This paper contributes to this debate by analysing the influence of firms' value creation and value capture capabilities on their competitive advantage and by studying the relationship of value creation and value capture. Through analysing survey data of 108 firms operating in the German Greentech industry, hypotheses were tested using partial least squares structural equation modeling. Most notably, find support was found for the hypothesis that firms' value capture capabilities moderate the influence of value creation on competitive advantage negatively, suggesting a substitutive relationship of value creation and value capture resource allocations. The authors' findings show that management can rather obtain competitive advantage by putting primary attention to either value creation or value capture instead of trying to maximise both at the same time.

Bio3 Research: An Entrepreneurial Process in the Market for Patents

This case concerns Bio3 Research, a small biotechnology company established in Italy in 2001 that focuses on cardiovascular disorders, connective tissue regeneration, and renal disorders. The case reports on Dr. Pilato, founder and chief executive officer of Bio3 Research, while reflecting with his chief operating officer on the investments required to finance his patents and products pipeline. The case offers a discussion around the entrepreneurial process of Bio3 Research, from opportunity identification to opportunity development and exploitation. The case then reveals Bio3 Research's business model and examines its activities and management practices in the patent market. In a recessive world economy, Bio3 Research has an exciting portfolio of patents and products in high–growth markets but must decide between financial options, as the company cannot exploit all of these opportunities on its own.

Interdisciplinarity and impact: distinct effects of variety, balance, and disparity

Interdisciplinary research is increasingly recognized as the solution to today's challenging scientific and societal problems, but the relationship between interdisciplinary research and scientific impact is still unclear. This paper studies the association between the degree of interdisciplinarity and the number of citations at the paper level. Different from previous studies compositing various aspects of interdisciplinarity into a single indicator, we use factor analysis to uncover distinct dimensions of interdisciplinarity corresponding to variety, balance, and disparity. We estimate Poisson models with journal fixed effects and robust standard errors to analyze the divergent relationships between these three factors and citations. We find that long-term (13-year) citations (1) increase at an increasing rate with variety, (2) decrease with balance, and (3) increase at a decreasing rate with disparity. Furthermore, interdisciplinarity also affects the process of citation accumulation: (1) although variety and disparity have positive effects on long-term citations, they have negative effects on short-term (3-year) citations, and (2) although balance has a negative effect on long-term citations, its negative effect is insignificant in the short run. These findings have important implications for interdisciplinary research and science policy.

Strategic flexibility and SME performance in an emerging economy

Purpose

– This study aims to address the following question: when strategic flexibility can be most beneficial to small and medium enterprises (SMEs) in the context of emerging economies.

Design/methodology/approach

– Drawing on dynamic capabilities perspective, this study builds a contingency model and examines it with survey data collected from 166 SMEs in China.

Findings

– This study finds that the relationship between strategic flexibility and firm performance is extensively moderated by external (competitive intensity and environmental munificence), internal (resource combination activities), as well as bridging factors (managerial ties).

Originality/value

– The findings contribute to the contingency view of strategic flexibility and firm performance research by incorporating insights from the dynamic capabilities perspective and by expanding the scope of existing research to emerging economies.