Externalization and Individualism: MNE Laboratories’ R&D Collaborations

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.