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The Impact of Inter-organizational R&D Collaboration on Firm Performance
To organizational scholars, it is not only important to understand why firms form inter-
organizational R&D collaboration, but is also important to know how such collaboration
will influence the relative profitability of the firms (Gulati, Nohria, and Zaheer, 2000).
For Chinese firms, we can identify at least three types of benefits from inter-
organizational R&D collaboration. First, it is easy to see that, collaborations in R&D with
universities, research institutes, and other firms could get access to new technologies,
which the firms themselves either have no ability to develop or which is not cost effective
to develop in-house.
Second, collaboration with the other R&D agencies has synergistic effects,
meaning that each partner could learn more than just developing new technologies. For
universities and research institutes, they can learn how their scientific knowledge could
be transformed into practical technologies and products. For firms, their own research
ability will be improved during the collaborations and thus in the future they could
contribute more to the collaboration as well as learn more extensively from participation
in such collaborations (Powell, Koput, and Smith-Doerr, 1996). Zhejiang Shangfeng
Company is a good example for such synergistic effects. Shangfeng Company had only a
very small technology research center with almost no college graduates in the 1980s. But
during its collaborations with three universities, it has successfully elevated its own
research center to the best in-house research center on cooling equipments in China.
Third, inter-organizational R&D collaboration can also help Chinese firms
manage uncertainty from foreign competitions through technological upgrading. Zhejiang
Shangfeng Company, for example, has successfully re-controlled the domestic market on
Convention