Within the realm of globalization of R&D, offshoring is a relatively recent and still emerging phenomenon. Rooted in the notion of comparative advantage, offshoring of R&D involves disaggregation and global distribution of the firm’s R&D value chain activities to leverage innovation capacity of low-cost countries. Characteristically different from market- and technology-seeking globalization of R&D, offshoring is motivated by the intertwining competitive needs to gain efficiency and access knowledge resources. This study represents a systematic, grounds-up attempt to explore the terrain of the phenomenon of offshoring of R&D and its influence on the competitive advantage of firms. Specifically, going beyond structural cost savings, the research examines the link between offshoring of R&D and the firm’s innovative capability and organizational flexibility—the two most important organizational capabilities of high technology firms. Employing an interpretive approach, the research includes multiple case studies of intra-firm and inter-firm offshoring of software R&D across a range of industries. The study demonstrates that by strategically organizing and managing offshoring of R&D, firms can significantly enhance their innovative capability and organizational flexibility. The findings suggest that offshoring of R&D is a new global organizational form that not only serves as an adaptive device but also allows firms to achieve ambidexterity.

, , , , , , , , , ,
, , ,
K. Kumar (Kuldeep)
Erasmus University Rotterdam , Erasmus Research Institute of Management
Prof.dr.ir. J.C.M. van den Ende Prof.dr. S.J. Magala Prof.dr. J. van Hillegersberg
ERIM Ph.D. Series Research in Management
Erasmus Research Institute of Management

Moitra, D. (2008, December 5). Globalization of R&D: Leveraging Offshoring for Innovative Capability and Organizational Flexibility (No. EPS-2008-150-LIS). ERIM Ph.D. Series Research in Management. Erasmus Research Institute of Management. Retrieved from http://hdl.handle.net/1765/14081