Tetsuo Wada

This article addresses the following question: How do family firms investing less in research and development (R&D) than nonfamily firms compete in R&D intensive industries? Using Japanese pharmaceutical industry data, we found that family firms produce more patents per R&D than nonfamily firms but are not biased toward low-value innovations. Further analyses of the distribution over innovation value suggested that family firms adopt a “contact-hitting R&D strategy,” avoiding radical innovations and pursuing incremental innovations compatible with their signature moves: innovation through tradition and narrow and internal search and resulting in may low-value innovations and a few mid or high-value innovations.

Despite many empirical studies having been carried out on examiner patent citations, few have scrutinized the obstacles to prior art searching when adding patent citations during patent prosecution at patent offices. This analysis takes advantage of the longitudinal gap between an International Search Report (ISR) as required by the Patent Cooperation Treaty (PCT) and subsequent national examination procedures. We investigate whether several kinds of distance actually affect the probability that prior art is detected at the time of an ISR; this occurs much earlier than in national phase examinations. Based on triadic PCT applications between 2002 and 2005 for the trilateral patent offices (the European Patent Office, the US Patent and Trademark Office, and the Japan Patent Office) and their family-level citations made by the trilateral offices, we find evidence that geographical distance negatively affects the probability of capture of prior patents in an ISR. In addition, the technological complexity of an application negatively affects the probability of capture, whereas the volume of forward citations of prior art affects it positively. These results demonstrate the presence of obstacles to searching at patent offices, and suggest ways to design work sharing by patent offices, such that the duplication of search costs arises only when patent office search horizons overlap.

Prior research suggests that equity joint ventures (JVs) are particularly effective vehicles for accessing complex technology. Different schools of thought have emphasized different reasons why joint ventures might support greater knowledge transfer than "bare" license agreements: incentive alignment, organizational embeddedness, and enhanced administrative controls. We probe and re. ne these theoretical perspectives, drawing out implications of the different theories for the extent and speed of alliance-related knowledge transfer, as well as for knowledge "leakage" in areas not directly related to alliance activities. Using a proprietary data set derived from regulatory filings with the Japanese government we test these implications in our empirical analysis of U.S.-Japan agreements. The picture that emerges from the analysis is one of particularly intense but contained knowledge transfer in equity joint ventures, relative to bare license agreements: knowledge transfers directly related to the alliance activity are enhanced in the JV, and the speed of integration into the Japanese firm's subsequent innovations also increases. In marked contrast, leakage of unrelated technology is significantly reduced. These findings suggest that administrative structures that reduce technology leakage are a key feature of the equity joint venture, a result that is inconsistent with a "pure" knowledge-based perspective on alliances.

Two economic theories that how had an immense impact on modern strategic management research are Porter's strategic positioning framework (SPF) and Williamson's transaction cost economics (TCE). While both theories have contributed to our understanding of strategic management and to the choice of strategy and structure, each theory offers managerial prescriptions that are incomplete at best. We contend that if followed in isolation, each theory can lead to inferior performance. This paper, In which studies the international courier and small package (IC&SP) services in Japan, improves upon prescriptions from both theories by linking Porter's and Williamson's approaches. Our main proposition is contained in three relationships that predict a fit among three strategic choices: market position, resource profile, and organizational structure. We test our predictions with a three-stage, reduced-form, endogenous self-selection model. While our empirical methodology is complicated and relies on a multilevel analysis, the methodology is necessary both for analyzing a constellation of activities in the vertical chain and for assessing strategy, structure, and performance when data can be drawn from only a limited number of firms. Our results suggest that a firm's market position, resource profile, and organizational choice are related in ways predicted by a positioning-economizing perspective. To be sure, our study is ambitious and suffers from a number of limitations; nevertheless, it provides one of the first attempts to theoretically and empirically link Porter's SPF and Williamson's TCE. Copyright (C) 2001 John Wiley & Sons, Ltd.