Global R&D organization and the development of dynamic capabilities: Literature review and case study of a Chinese high‐tech firm

Abstract

Purpose

How does the internationalization of R&D influence the development of dynamic capabilities? Based on the observation that Chinese high‐tech companies internationalize parts of their R&D activities to Western countries before they have established sound domestic R&D capabilities and in opposition to other held beliefs about internationalization drivers this paper aims to investigate the role of global R&D organizational structure in the development of dynamic capabilities.

Design/methodology/approach

This research is based on a qualitative case study using data of one Chinese high‐tech firm to develop testable propositions.

Findings

The research develops three main propositions: the loss of competitive advantage and relevant capabilities in the domestic market is more important to the internationalization of R&D than an attempt to enter new international markets; in joint development teams with a partner company, a functional R&D team sub‐structure using heavyweight or autonomous teams leads to a higher degree of knowledge exchange in the partner sub‐project organization; R&D projects conducted in organizations with higher formal control lead to a higher degree of learning than R&D projects conducted when control is shared with a partner; R&D projects which rely extensively on external knowledge (with no formal control) produce better outcomes for learning than projects conducted under joint control; R&D projects which rely extensively on external knowledge (with no formal control) produce better outcomes for learning than projects conducted in full control.

Research limitations/implications

As the research is based on data of one single case study there are several inherent limitations regarding validity and reliability which need to be covered by future research.

Originality/value

This paper posits that R&D internationalization has a positive influence on the development of dynamic capabilities.

Citation

Ester, R.M., Assimakopoulos, D., von Zedtwitz, M. and Yu, X. (2010), "Global R&D organization and the development of dynamic capabilities: Literature review and case study of a Chinese high‐tech firm", Journal of Knowledge-based Innovation in China, Vol. 2 No. 1, pp. 25-45. https://doi.org/10.1108/17561411011031972