Knowledge, Organizational Evolution, and Market Creation
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Knowledge, Organizational Evolution, and Market Creation

The Globalization of Indian Firms from Steel to Software

Gita Sud de Surie

Knowledge, Organizational Evolution, and Market Creation documents the emergence of the Indian multinational by looking at data from firms in the ‘old’ economy, such as those in manufacturing, steel-making, automotive components and heavy machinery and the ‘new economy’ such as software and biotechnology. The author provides insights on knowledge transfer, innovation and capability building processes through in-depth case studies in these industries and suggests that both entrepreneurship and distributed innovation are critical for the growth of firms globally.
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Chapter 6: Industrializing Knowledge Production via Born Global Firms: Biotechnology and Software

Gita Sud de Surie


6. Industrializing knowledge production via born global firms: biotechnology and software The two previous chapters discussed three stages of evolution of firms in the manufacturing sector and their progression from learning via transferring technology from external sources to institutionalizing the knowledge gained, and, finally accelerating knowledge production in the new environment. In contrast, in this chapter I focus on the rise of Indian firms in knowledge-intensive industries such as software and biotechnology. The manufacturing firms differ from software and biotechnology firms in three ways. First, while complex technical knowledge was required for the former (firms producing steel, bearings, earthmoving equipment, automotive components, engines, farm equipment and commercial vehicles), the knowledge underlying these technologies was well understood and diffused. In contrast, the biotechnology and software industries are less mature than steel and automotives, the underlying knowledge more complex, and embedded not just in firms but within an institutional system. Second, manufacturing firms were only able to convert to using information technology for all activities in Stage III. In contrast, software and biotechnology firms, being younger and being IT-based could modularize activities from the start. Third, manufacturing firms were isolated from global markets until the 1990s; consequently, the attainment of Stage I took longer. It was only in the 1990s that managers in these firms realized that it was not necessary to reinvent the wheel. However, the first two stages were accelerated in the software and biotechnology firms, because of their late entry and because they were interacting from the...

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