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The impact of inward international licensing on absorptive capacity of SMEs

The impact of inward international licensing on absorptive capacity of SMEs Purpose – This study aims to examine the impacts of inward international licensing (IIL) on the absorptive capacity (ACAP) of small and medium enterprises (SMEs) in a developing economy. Design/methodology/approach – The study is explorative, qualitative and elaborative in nature. Therefore, a multiple case study was selected and performed as the research strategy. The data were collected from four pharmaceutical SMEs licensed from European pharmaceutical large‐scale enterprises. Findings – The results confirm that IIL has a strong effect on acquisition, assimilation, transformation and exploitation as absorptive factors. Furthermore, the results have been enhanced by several contextual factors of ACAP human resources, inter‐and intra‐firm relationships, internal knowledge and managerial and strategic aspects. These contextual factors have also been influenced by IIL. Originality/value – From the licensee perspective in a developing context, examining the extant literature on non‐equity strategic alliances shows that very few studies have empirically examined the impact of this kind of alliance, such as IIL, on SMEs’ ACAP. On this basis, the study provides evidence that non‐equity strategic alliances, particularly IIL, enhance SMEs’ capabilities such as ACAP. In other words, to overcome SMEs’ resource limitations and inadequate capabilities, IIL provides opportunities for them to obtain capabilities and critical resources. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png International Journal of Quality and Service Sciences Emerald Publishing

The impact of inward international licensing on absorptive capacity of SMEs

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Publisher
Emerald Publishing
Copyright
Copyright © 2014 Emerald Group Publishing Limited. All rights reserved.
ISSN
1756-669X
DOI
10.1108/IJQSS-02-2014-0011
Publisher site
See Article on Publisher Site

Abstract

Purpose – This study aims to examine the impacts of inward international licensing (IIL) on the absorptive capacity (ACAP) of small and medium enterprises (SMEs) in a developing economy. Design/methodology/approach – The study is explorative, qualitative and elaborative in nature. Therefore, a multiple case study was selected and performed as the research strategy. The data were collected from four pharmaceutical SMEs licensed from European pharmaceutical large‐scale enterprises. Findings – The results confirm that IIL has a strong effect on acquisition, assimilation, transformation and exploitation as absorptive factors. Furthermore, the results have been enhanced by several contextual factors of ACAP human resources, inter‐and intra‐firm relationships, internal knowledge and managerial and strategic aspects. These contextual factors have also been influenced by IIL. Originality/value – From the licensee perspective in a developing context, examining the extant literature on non‐equity strategic alliances shows that very few studies have empirically examined the impact of this kind of alliance, such as IIL, on SMEs’ ACAP. On this basis, the study provides evidence that non‐equity strategic alliances, particularly IIL, enhance SMEs’ capabilities such as ACAP. In other words, to overcome SMEs’ resource limitations and inadequate capabilities, IIL provides opportunities for them to obtain capabilities and critical resources.

Journal

International Journal of Quality and Service Sciences – Emerald Publishing

Published: Jun 10, 2014

Keywords: Iran; Absorptive capacity; SMEs; Learning; Dynamic capabilities; Inward international licensing

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