Meeting the Innovation Challenge
Edited by John Bessant and Tim Venables
Chapter 12: How Firms Source Knowledge from Universities: Partnering versus Contracting
12. How ﬁrms source knowledge from universities: partnering versus contracting Markus Perkmann and Kathryn Walsh INTRODUCTION There is an expanding literature stressing the importance of external knowledge sources for ﬁrms. Research alliances and technological collaboration (Freeman 1991; Hagedoorn et al. 2000), open innovation (Chesbrough 2003), networked and distributed innovation (Coombs et al. 2003; Powell et al. 1996) are concepts used for describing and theorizing this phenomenon. Empirically speaking, several trends indicate that external sources of innovation are becoming more important in the overall innovation strategies of ﬁrms (Fey and Birkinshaw 2005): knowledge required for innovating is more dispersed within the economy, particularly in rapidly changing areas such as biotechnology (Chesbrough 2006; Powell et al. 1996); products include a broader range of diﬀerent technologies (Iansiti 1997); some industries are moving towards open standards and modular innovation (Baldwin and Clark 1997), and outsourcing strategies have expanded to include innovation-intensive components and systems (Harabi 1998); and ﬁnally, the type of parties involved in innovation processes appear to become more disparate, as for instance in the case of user-driven innovation (von Hippel 1987). Links between ﬁrms and universities can be seen as part of this general scenario. The generic economic and social beneﬁts of universities,1 such as educating cohorts of graduates, generating scientiﬁc knowledge and instrumentation,2 have long been recognized as an important source of industrial innovation (Pavitt 1991; Salter and Martin 2001). Yet recently, universities have made eﬀorts to engage more directly in industrial innovation processes. Various...
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