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Industry cognitive distance in alliances and firm innovation performance
Author(s) -
Filiou Despoina,
Massini Silvia
Publication year - 2018
Publication title -
randd management
Language(s) - English
Resource type - Journals
SCImago Journal Rank - 1.253
H-Index - 102
eISSN - 1467-9310
pISSN - 0033-6807
DOI - 10.1111/radm.12283
Subject(s) - context (archaeology) , business , industrial organization , cognition , similarity (geometry) , marketing , pharmaceutical industry , computer science , psychology , medicine , paleontology , pharmacology , neuroscience , artificial intelligence , image (mathematics) , biology
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.