Technology, Knowledge and the Firm Implications for Strategy and Industrial Change PHẦN 7 pot

and, either for this reason, or because entrepreneurs spoke a similar lan￾guage, they were easier to establish.

Personal networks played different roles in these processes. In market

relationships they served mostly as facilitators, that is firms used their

contacts to achieve access and to provide first references, although these had

to be demonstrated during negotiation. In the early stages they were basi￾cally social networks (such as, ex-colleagues working in foreign firms) and it

was only later that did they started being composed of previous clients or

market partners. With respect to technology access, members of the per￾sonal networks, (often ex-research partners, colleagues or supervisors)

could themselves be the target for collaboration, provide access to their sci￾entific networks, or act as credibility enhancers. The latter role was namely

performed by reputed scientists whom the firms enlisted as an informal

‘advisory board’. Informal linkages with reputed scientists were rarely used

as references for business, but formal research partnerships were used for

that purpose.

With respect to the mechanisms used in the search process, it was con￾cluded that while ICT is widely used in the field, both for business and for

research, face to face contacts remain critical. ICT can partly assist the early

identification of opportunities, can support the activities, particularly when

they have been formalized and are ongoing and can assist in nurturing per￾sonal networks. But the effective establishment of relationships requires face

to face contacts at some point, negotiation processes require frequent inter￾action and the development of technology relationships may require periods

of temporary co-location. Direct contacts are also necessary for ongoing

partnerships, even if only occasionally, to guarantee periodic reassessing of

issues and to maintain the relationships in good shape. Finally, attendance

at key international events that bring together the main scientific and/or

industrial actors in a given area, can also be an important source of infor￾mation about opportunities and a fruitful means of making new contacts.

These results are not exclusive to out-cluster NBFs. But their most sig￾nificant implication for these firms is that, because a substantial part of

their contacts will be distant, out-cluster entrepreneurs will need to con￾stantly travel great distances in order to guarantee a level of integration at

least close to those who have a more substantial part of their partners’,

clients’ and personal networks nearby. Additionally, cultural differences

will be more critical for these entrepreneurs and country-of-origin effects

may be at work, making negotiation processes slower and still increasing

the costs and difficulties of reaching agreements. This will entail a much

greater financial cost, and personal effort than is required by similar firms

located in clusters Moreover, members of out-cluster NBIs also require

particularly good relational skills.

170 Innovation and firm strategy

5. DISTANT NETWORKING STRATEGIES

The analysis conducted in the previous sections enabled us to go through the

initial propositions regarding the adoption of specific strategies by biotech￾nology firms operating out-cluster and permitted an in-depth understand￾ing of the conditions underlying them. While generically confirming the

propositions, the analysis of the particular cases permitted us to identify

some variety regarding the relative relevance of the national/ international

environment, as well as diverse forms of addressing the general conditions

all firms faced. It is therefore possible to advance a first characterization of

what we have labelled ‘distant networking strategies’:

1. Relevance of co-location to a particular RO or set of ROs in the processes

that lead to the creation and early development of the firm. But different

weights of main RO inputs: knowledge/capacity to assist development;

2. Need to resort to foreign relationships at early stages, in order to com￾plement the national knowledge base and the resources available locally.

But different levels of national/foreign contribution, depending on strength

of national knowledge base; and different levels of mediation in search

processes;

3. Critical importance of foreign markets and of foreign market relation￾shipsforthecommercializationof coretechnologies/products.Importance

of national market in early years, as source of income while developing the

core business, but only for less sophisticated services or products;

4. Unsupported search for foreign clients and market partners, given weak￾ness of industrial structure in relevant areas and deficiencies of national

capital markets. Although capacity to conduct this search differed, accord￾ing to founders’ foreign experience and type of personal networks;

5. Intensity of purposive/planned interactions, involving frequent face to

face contacts, in addition to extensive use of ICT, hence requiring high

relational capacities and constant travel (with associated costs);

6. Influence of entrepreneurs’ (and employees’) international back￾ground, experience and contacts in technology and market interna￾tionalization processes;

7. Potentially negative impact of ‘country-of-origin’ effects.

Notwithstanding these common features, it is possible to devise two major

types of strategic approaches to building up foreign relationships, which are

basically influenced by the presence and the quality of the local knowledge

base in relevant fields and by the degree of integration of local ROs in inter￾national scientific networks. In fact, the majority of firms had, from the

Out-cluster strategies of new biotechnology firms 171

start-up, perceived the foreign market as an important outlet for their busi￾ness, be it complementary or exclusive, and they were mostly unsupported in

their search in this area. Therefore, the conditionsin which firms approached

foreign market relationships were relatively similar, even if the modes could

be different. On the contrary, firms differed in terms of: (1) the relative need

for knowledge originating from foreign sources; (2) the conditions in which

they searched for these sources and their ability to gain access to and estab￾lish relationships with them, as well as the capacity to absorb and use the

knowledge thus acquired. The main source of such variance was the strength

of the national science base.

Two different patterns were thus identified in the establishment of foreign

technological relationships:

Pattern 1: Mediated integration – Based on a strong national science base,

embodied in the ‘parent’ ROs, who also have a good integration in inter￾national scientific networks.

Pattern 2: Exploratory integration – Based on weaker or still developing

national science base and on limited connections with international

research, but associated with the local ROs interests, and the assistance of,

entrepreneurs’ efforts.

The main features of mediated integration are:

1. The national science base, characterized by high quality and consoli￾dated research conducted in one or a set of ROs. The ROs have a sig￾nificant bearing on the decision to establish firms. And in the early

stages they are also one of the firm’s main sources of knowledge.

2. The production of knowledge usually takes place in the context of inter￾national scientific networks, in which the parent organization(s) play a

relevant part. Thus firms need to access complementary knowledge that

is distributed in the network. Particularly they need to access and par￾ticipate in the production of more application-oriented knowledge (that

is absent locally), collaborating with foreign firms for this purpose.

3. ROs’ willingness to provide access to their network (when entrepreneurs

are not already part of it) enables a firm’s participation in common

research projects as well as less formal exchanges. This mediation eases

entry into research communities where access might be difficult for new￾comers. Integration in the community and participation in technology

development facilitate the access to more tacit forms of knowledge,

favouring absorption and may also generate new opportunities.

4. Through time the firm and its scientists reduce dependence on the

parent for access and may become network members in their own right

172 Innovation and firm strategy