The Future Of Innovation Is In Collaborative Networks

Prof Lluís Santamaria Sánchez

In view of the seriousness of the economic crisis, an expected reaction could be the reduction of the innovation efforts given that they have not a visible and short term impact. Faced with this situation the critical question is: Which is the future of innovation?

Contrary to the general expectation, my point of view is that the answer (or, at least, to a great extent) to the economic crisis is on the hands of innovation mechanisms. Economic growth is increasingly connected with the generation and application of new knowledge. Firms are subject to rapid technological changes and a constant need to innovate more quickly and in more novel ways than their competitors. The challenge is becoming increasingly important in today’s rapidly changing world. Meeting this challenge has led entrepreneurs, researchers and politicians to take a special interest in the different mechanisms and strategies that help to achieve innovations.

Levels of innovativeness and competitiveness, however, may not simply depend on skills that firms can find and exploit in-house, but on the effectiveness with which they can gain access to external sources of technological knowledge and skills. As innovation occurs primarily through new combinations of resources, ideas, and technologies, a fertile innovation environment relies on a constant inflow of knowledge from other places. Even the largest innovation active organizations cannot rely solely on internal sourcing; they also require knowledge from beyond their boundaries when developing innovations. That is, the open innovation paradigm and, particularly, the role of technological collaboration will get stronger.

From this point, there are different challenges and critical factors that technological collaboration should deal with. First, the experience in the management of alliances should be reflected in better results in terms innovation outcomes. The inherent difficulties of technological collaboration are gradually overcome as the firm learns to collaborate, thanks to the development of its alliance management skills and its reputation over time. If we also throw in the fact that the firm is accumulating knowledge from its partners, it will be better placed to innovate on account of the boost to its resource endowment and innovation capabilities.

Second, the choice of partners in the collaborative network may be a make-or-break decision for the success of innovation. The diversity in the make-up of collaborative networks should favour innovation novelty more than collaboration with a single type of partner does. Being integrated in a heterogeneous network promotes access to diverse sources of information and enables firms to transfer and apply that knowledge. When this happens firms find themselves in a better position to achieve more novel innovations. In this sense, a challenge for researchers and practitioners is the understanding of the suitability of the partners as well as the complementarities among them.

Third, the role of technological collaboration is particularly important for Small and Medium Sized firms (SMEs). It contributes to improving the innovativeness of SMEs and allows them to bridge the innovation gap with their larger counterparts.

Fourth, considering the impact of cooperation on private profits and social benefits, the greatest challenge for policy-makers is to promote cooperation not only through the provision of funding but also improving the institutional infrastructures (i.e. universities and technology institutes).

The final point is that technological collaborations are a good mechanism for overcoming firms’ resource constraints for innovating (even more in the current economic situation), strengthening the different innovation systems and, from here, being one of the key mainstays of the future of innovation.

Article © 2009 Prof Lluís Santamaria Sánchez. All rights reserved.

about the author...

Prof Lluís Santamaria Sánchez

Prof Lluís Santamaria Sánchez

affiliation:   Universidad Carlos Iii De Madrid

position:  Assistant Professor of Accounting

country:  Spain

area of interest:  Technological Collaboration

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