DSpace Collection: Incentives and Boundaries (IB)

Putting Patents in Context:Exploring Knowledge Transfer from MIT

Wed, 08 Aug 2001 22:58:59 GMT

Title: Putting Patents in Context:Exploring Knowledge Transfer from MIT

Authors: Agrawal, Ajay; Henderson, Rebecca

Abstract: In this paper we explore the degree to which patents are representative of the magnitude, direction, and impact of the knowledge spilling out of the university by focusing on MIT, and in particular on the departments of Mechanical and Electrical Engineering. Drawing on both qualitative and quantitative data, we show that patenting is a minority activity: a majority of the faculty in our sample never patent, and publication rates far outstrip patenting rates. Most faculty members estimate that patents account for less than 10% of the knowledge that transfers from their labs. Our results also suggest that in two important ways patenting is not representative of the patterns of knowledge generation and transfer from MIT: patent volume does not predict publication volume, and those firms that cite MIT papers are in general not the same firms as those that cite MIT patents. However, patent volume is positively correlated with paper citations, suggesting that patent counts may be reasonable measures of research impact. We close by speculating on the implications of our results for the difficult but important question of whether, in this setting, patenting acts as a substitute or a complement to the process of fundamental research.

Metrics Thermostat

Thu, 28 Jun 2001 22:58:59 GMT

Title: Metrics Thermostat

Authors: Hauser, John

Abstract: The explosion of information and information technology has led many firms to evolve a dispersed product development process with people and organizations spread throughout the world. To coordinate such dispersed processes managers attempt to establish a culture that implicitly rewards product development teams based on their ability to perform against a set of strategic metrics such as customer satisfaction, time to market, defect reduction, or platform reuse. Many papers have focused on selecting the right metrics and establishing the culture. In this paper we focus on a practical method to fine-tune a firm's relative emphasis on the metrics that they have chosen. In particular, we seek to advise a firm whether to increase or decrease their emphasis on each metric such that the change in emphasis improves profits. Using a thermostat analogy we apply an adaptive control feedback mechanism in which we estimate the incremental improvements in priorities that will increase profits. Iterations of adaptive control seek to maximize profits even if the environment is changing. We demonstrate the metric thermostatâs use in an application to a firm with over $20 billion in revenue. In developing the metric thermostat we recognize that there are hundreds of detailed actions, such as the use of the house of quality and the use of robust design, among which the product development team must choose. We also recognize that they will act in their own best interests to choose the actions that maximize their own implicit rewards as determined by the metrics. Management need not observe or dictate these detailed actions, but rather control the process by establishing the culture that sets the implicit weights on the metrics. The thermostat works by changing those implicit weights. We define the problem, introduce the adaptive control mechanism, modify âagencyâ theory to deal with incremental changes about an operating point, and derive methods that are practical and robust in light of the data that firms have available. Our methods include statistical estimation and internal surveys. The mathematics identify the critical few parameters that need be determined and highlight how to estimate them. Both the measures and the estimation are illustrated in our initial application to a large officeequipment firm. The metrics thermostat suggests that this firm has about the right emphasis on timeto- market, but has overshot on platform reuse and has lost its focus on customer satisfaction. We describe how the firm reacted to the recommendations and changed its organization. We describe additional ongoing applications with the US Air Force, the US Navy, and a major automobile and truck manufacturer.

Untangling the Origins of Competitive Advantage

Sun, 27 Feb 2000 22:58:59 GMT

Title: Untangling the Origins of Competitive Advantage

Authors: Cockburn, Iain; Henderson, Rebecca; Stern, Scott

Abstract: What are the origins of competitive advantage? Although this question is fundamental to strategy research, it is one to which we lack a clear answer. As strategy researchers we believe that some firms consistently outperform others, and we have some evidence consistent with this belief (Rumelt, 1991; McGahan and Porter, 1997). We also have a number of well developed theories as to why, at any given moment, it is possible for some firms (and some industries) to earn supranormal returns. As of yet, however, we have no generally accepted theory C and certainly no systematic evidence C as to the origins or the dynamics of such differences in performance. We know, for example, why high barriers to entry coupled with a differentiated product positioning obtained through unique organizational competencies may provide a firm with competitive advantage. But we know much less about how barriers to entry are built: about why this firm and not that one developed the competencies that underlie advantage, and about the dynamic process out of which competitive advantage first arises and then erodes over time.

Description: A paper prepared for the SMJ Special Issue on The Evolution of Firm Capabilities