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Innovation in Business Groups

by S Belenzon, T Berkovitz
Management Science ()

Abstract

Using novel data on European firms, this paper investigates the relationship between business groups and innovation. Controlling for various firm characteristics, we find that group affiliates are more innovative than standalones. We examine several hypotheses to explain this finding, focusing on group internal capital markets and knowledge spillovers. We find that group affiliation is particularly important for innovation in industries that rely more on external funding and in groups with more diversified capital sources, consistent with the internal capital markets hypothesis. Our results suggest that knowledge spillovers are not the main driver of innovation in business groups because firms affiliated with the same group do not have a common research focus and are unlikely to cite each other's patents.

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Innovation in Business Groups -

Innovation in Business Processes Luis Borges Gouveia Feliz Ribeiro Gouveia David Ribeiro Lamas {lmbg, fribeiro, dlamas}@ufp.pt Multimedia Study and Research Center University Fernando Pessoa Pr 9 de Abril, 349 P-4200 Porto Portugal Abstract Business to consumer electronic commerce will need better tools, beyond browsers and gadgets, for the user to take full advantage of the opportunities of the electronic marketplace. On the other side, business needs to rethink their positioning, and to deal with this new customer using new methods and tools. We present in this paper a tool for navigating large information spaces, such as the Web, using what is called here ���rough guides���. The tool uses user preferences to perform adaptive guidance. Rough guides bring new interactions into the electronic commerce arena: how they are produced, sold, and updated using consumer���s feedback can be done in several and different ways than in a classic economic framework. Introduction The way people buy and sell is certainly changing with the advent of electronic marketplaces. Current information technology already has a strong influence both on before-sale and after-sale techniques and systems. These systems take the form of help desks, call centres, logistics and distribution systems, and strong enterprise alliances to outsource important client functions, from development to marketing. With some exceptions, namelly the UPS Tracking System (http://www.ups.com), none of them was developed with the internet in mind. These business support systems can be seen as a visible sign of the more than probable move to full electronic commerce. In effect, protocols like Electronic Data Interchange (EDI) or systems supporting government to citizen relationships (like the Portuguese Infocid platform) are already in place and have been used for several years. Financial institutions and banks have used for several years electronic transactions. This gives a true field to implement electronic commerce both between businesses and between government and citizens. Business to business electronic commerce is already on the move and several authors give figures that show its growing importance in the context of business to business relationships and in the global context of electronic commerce where it represents in a near future 80% of the value of transactions. In this paper, we will concentrate in the business to consumer electronic commerce, where there is still much to be developed and where a lot of research about use and development of new methods, tools and processes is still being devised. It seems that two key factors are essential to leverage business to consumer electronic commerce:
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tools to allow it, and consumer trust. Current tools, such as search engines, information warehouses, electronic mail and bulletin boards, do not scale well in a global market, and do not allow for shopping guidance. The user ends giving up either because of large waiting times, lots of information, lost pointers, or lack of confidence. The proposal Our proposal is based in the following: x simple, anonymous, secure, and reliable payment schemes will find the mainstream, and will eventually be adopted. Electronic wallets and micropayments are the most promising (Choi et al. 1997) x an information-based economy will enable consumers to be also producers (prosumers), and trading of information will take of. Information about what is on the Web, where it is, and how much it is worth, can be a catalyst for micro- payments to take place between prosumers x automated services, such as intelligent agents, webcrawlers, and search engines, will be increasingly disapointing as 1) firewalls and other security features prevent them from entering web sites, 2) unstructured information is and will be difficult to filter and process automatically, and 3) more and more information is stored in server databases and cannot be found in html pages. There are already some partial solutions to the problems outlined above: strong cryptography allows for digital cash to be a reality internet communities exist linked either by interest or by other social factors and internet auctions are a success and directory services, such as Yahoo, although facing the overwhelming task of manually indexing up to 300 million web pages, are the preferred starting point for navigation as they are more reliable (Chakrabarti, 1999). In our proposal, users have at their disposal available information about several themes, consisting of a compilation of internet addresses. These compilations are called ���rough guides���, and they are much pretty the same as their city guides or tourist guides analogs. Rough guides can be used in a standard web browser, in a standard way, as described latter. Depending on the profile of the user, rough guides show different information to the user, allowing thus to adpative navigation and guidance. The implications we see are the following: x rough guides can be produced and sold about a great variety of themes. The authors can be individuals or companies. Good and bad guides will exist, but this is a market problem, and the market will solve it. Guides can be produced on specific themes ��� for example, ���the 10 best places for information on History���, ���buying technical books���, or ���best design pages��� ���, or very general ones, such as ���complete listing of government services on the internet��� x rough guides should allow for easy updating, as internet pointers come and go. They should also allow for comments from different users to be included, opening the

Readership Statistics

52 Readers on Mendeley
by Discipline
 
 
 
by Academic Status
 
38% Ph.D. Student
 
15% Student (Master)
 
13% Assistant Professor
by Country
 
12% United Kingdom
 
12% United States
 
10% Germany

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