Externalization and Individualism: MNE Laboratories’ R&D Collaborations

Abstract

A key element in the modeling of the MNE as a heterarchy (Hedlund, 1986, 1993; Hedlund and Rolander, 1990; Birkinshaw, 1994) is to discern the presence in these companies of an increasing variety of types of subsidiaries.¹ Within this the most radical perception has been of the emergence of new forms of subsidiaries, which undertake product development based round individualized in-house creative competences.² Another quite decisive perception is that a key factor discriminating between types of subsidiaries, and playing a strong role in defining the characteristics of the creative (product development) subsidiaries, is the degree of in-house commitment to R&D. In this way the subsidiary evolution literature parallels another strongly emerging area of investigation, i.e. that relating to the decentralization of R&D in MNEs.³ Within this literature it is now frequently argued that ‘supply-side’ factors are becoming increasingly relevant, i.e. that the presence and role of MNE labs in a particular country reflects the ability of that country to supply distinctive and high-quality scientific inputs (Florida, 1997; Cantwell, 1991; Cant-well and Janne, 1999; Kuemmerle, 1999a; Granstrand, 1999). Supporting this it is then argued that a vital factor affecting the value of these MNE labs is the extent and richness of their interaction with the host-country science-base and technological community.⁴ This chapter seeks to analyze certain aspects of such scientific collaborative links between foreign MNE labs operating in the UK and institutions external to the company.