Drivers, benefits and the role of experience in global offshore R&D collaboration : Insights of unexpected learning among large multinationals

• Offshoring of production and low-value activities to BRIC region is a widely practiced and well understood phenomenon. Still, the offshoring of advance engineering and R&D oriented activities is unstudied practice. As a growing filed of interest, prior studies now indicate a complexity of understanding drivers and benefits of R&D offshoring. This study provides an interesting perspective on R&D offshoring, based on insights from two large manufacturing firms with offshore collaboration experience. In a focus of drivers and benefits with offshoring, we find a decision to offshore R&D is based upon similar rationales as offshoring of low-value activities such as the increasing need for cost advantages, lack of skilled talent and market closeness. However, the study also suggests offshoring of R&D can create unexpected benefits. In fact, we show over time the benefits from R&D offshoring tends to be much greater then what the companies had initially bargained for. Drawing upon literature on learning and the evolutionary development of capabilities, we provide an alternative view on benefits that confirm the existing view that experienced firms are able to gain greater collaborative benefits and outline a framework about what is specific with those benefits in offshoring. We notice that the development of internal processes and tasks, new processes and work methods, gaining competence from offshore workers, signifying internal competence development, extended resource utilization, and designing of effective relationships constitute fundamentals for developing global collaborative capabilities. What is especially interesting is that this capability development is likely not the primary reasons for large multinationals to enter and engage in offshoring initially. These reasons seem to be based upon conventional motives such as reduced costs, access to competence and being close to customers and end markets. Future studies are encouraged to build on these findings and our framework call for future attention of unexpected challenges associated with R&D offshoring.

Subject headings

TEKNIK OCH TEKNOLOGIER  -- Annan teknik -- Övrig annan teknik (hsv//swe)

ENGINEERING AND TECHNOLOGY  -- Other Engineering and Technologies -- Other Engineering and Technologies not elsewhere specified (hsv//eng)

Keyword

fasteass

offshore collaboration

organizational learning

capability

life cycle perspective

global collaboration capability

Entreprenörskap och innovation

Entrepreneurship and Innovation

Centre - The Faste Laboratory

Centrumbildning - Fastelaboratoriet

Publication and Content Type

ref (subject category)

kon (subject category)